Harald Wester, head of engineering at Magna Steyr, will be responsible for advanced engineering at Fiat's new matrix organization starting November 1.
Demel, who had been Magna Steyr CEO before joining Fiat Auto, and Magna boss Siegfried Wolf personally negotiated the details of the contract.
When he began at Fiat in November 2003 Demel promised not to headhunt any of his former VW Group employer's personnel.
Wester and Demel have known each other for years. They worked together at Audi. Later Wester worked in product engineering at Ferrari for two years.
In April Demel lured Stefan Ketter, then a VW manager, to Fiat Auto as quality director. Shortly thereafter he hired VW's new marketing and sales boss Johann Wohlfahrter.