Fiat's Serbian unit halts production at plant that makes 500L

Fiat builds the 500L in Kragujevac, Serbia, in a factory that once made Yugos.

BELGRADE (Reuters) -- Fiat's Serbian unit has halted production at its factory in Kragujevac after a supplier was unable to deliver parts, the company said today.

The plant makes the Fiat 500L, which began sales in the United States this summer.

The halt comes as disgruntled workers at a transport company blocked railways and roads in the area over unpaid wages.

Fiat spokeswoman Aleksandra Rankovic was unable to confirm if the halt in production was due to the blockade, which has lasted 10 days. "Production ceased on Wednesday and we still don't know when it will resume," she said.

The factory, a 1-billion-euro ($1.38 billion) joint venture 67 percent owned by Fiat Group and 33 percent by the Serbian state, began production of the 500L family of small cars in July 2012. It produced 30,000 vehicles last year.

The plant, a major exporter in Serbia and driver of its struggling economy, plans to produce about 110,000 to 140,000 cars this year. Some of the cars are expected to the United States.

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