The end of Yugo, the last Yugoslavian car

[Other News - Roberto Savio / IPS <soros at topica.email-publisher.com>]

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After Yugoslavia, the Yugo Goes

 By Vesna Peric Zimonjic

KRAGUJEVACK, Serbia, Feb (IPS) û After 20 busy years in former
Yugoslavia and the Balkans, the little "Yugo" car has come to the end of the
road.

   It is more than a car that is now coming to a halt. The end of production
marks
the symbolic end of an ethos of self-sufficient industrial production.

   Production of the Yugo, or the Zastava to give it its proper name, is due to
end
this year.

   Some 180,000 Yugos, an offspring of two Fiat models of the late 1970s, were
manufactured in the central Serbian town Kragujevac. At peak production it was
one of the biggest car manufacturing plants in the Balkans.

   Yugos were priced at a modest 3,900 dollars. Tens of thousands were
exported to 74 countries, including India, Egypt, Sudan, Colombia and even the
United States.

   Now they are among few visible signs of former Yugoslavia in the new
republics. Thousands still roam the roads of Croatia, Bosnia-Herzegovina and
Macedonia 13 years after the common homeland fell apart.

   Production should have been switched off long back, financial analyst Milan
Kovacevic told IPS. "It is clinically dead and no sentiments should prevail
now.
This should have been done 12 years ago. There is no way but to claim
bankruptcy."

   Miki Savicevic, chairman of the board of directors and a veteran of Serbian
entrepreneurship took the job in 2001. He looked for a foreign partner to help
revive the car complex that produced only 13,000 cars in 2002.

   Toyota and Peugeot spent several million dollars on feasibility studies but
finally said no. The original parent Fiat was not interested either.

   "We have to give up the illusion that Serbia can produce a car of its own,"
Savicevic now says. "Negotiations with foreign investors failed when they saw
all the accumulated problems."

   The decline began in 1992 when international sanctions were imposed
against Serbia for its role in the wars of former Yugoslavia. Disintegration of
the
common Yugoslav market that absorbed 60 percent of the cars brought
production to near standstill. Many of the new republics were also production
centres for parts.

   The regime of former president Slobodan Milosevic kept the car factory
running somehow until 2000 when it fell from power. More than 18,000 workers
remained formally employed, with their meagre income paid out of the state
coffers.

   The Zastava complex in Kragujevac included also a trucks assembly unit and
an arms factory. Milosevic's regime feared social unrest if the plant were
to be
closed down.

   The new authorities took a different approach. Generous bonuses were paid
to more than 25,000 workers with the help of international aid. Only a fraction
of
the workforce remained, in the hope that the plant would attract new investors.
Others turned to farming or to private small business.

   Trade union leaders proposed a 230 million dollar project to design and
produce a new family car. "Serbia has the knowledge and technology for that,"
union leader Zoran Mihajlovic told visiting media representatives in
Kragujevac.
"Our project is almost ready, but we need support from the state budget to
start
production."

   Few think this can work. "Such a project is completely senseless," financial
analyst Misa Brkic told IPS. "That would be romantic gambling with the
budget of
a poor nation. There is no bank that would credit this. The approach is a
hangover of the era of self-sufficiency."

   Self-sufficiency was the trademark of communist Yugoslavia for decades. It
meant that workers took active part in strategic decision-making in factories,
offices, hospitals and universities through "workers councils". Many still
think
that was a good way.

   And many think the Yugo was a good car. Workers and executives say a
survey by the U.S. magazine Forbes that ranked  the Yugo as the worst foreign
car ever to enter the U.S. market was an insult.

   The magazine said the look, the performance and road safety of the car were
all questionable. More than 150,000 Yugos were exported to the United States
in 1988-91.

   "Yugo is not a tin can as some people describe it," says Miljko Kokic at the
development department of the car factory. "It was among the cheapest cars
produced in Europe and proved to be a lasting product."

   Many Serbs agree, but point out also that years of isolation and poverty
meant
they could not try anything else.

   "I've been driving my Yugo for the past 13 years," says Borivoje Spasojevic
from the northern Serbian town Novi Sad. "Only twice I have had to see the
mechanic since then. I spent only about 700 dollars in maintenance in these
years."

   Local television cameraman Zoran Ljubojevic says it helps that you can buy
spares for the car at local kiosks. "It's not comfortable, but it's great for
short rides
and the bumpy and curvy roads of Serbia," he says. "And for nothing else."
(END/IPS/


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"Other News" is a personal initiative seeking to provide information that
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"Other News" motto is a phrase which appeared on the wall of
Barcelona’s old Customs Office, at the beginning of 2003:”What
walls utter, media keeps silent”. Roberto Savio

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