There's light at the end of the tunnel - and a new spring in Fiat's step. Mary Minihan reports from Turin.
For the citizens of Turin at least, working for Fiat is still the quintessential Italian job. They say one in every five, perhaps even one in four, of the northern city's one million or so residents work for Fiat and its subsidaries or in a job that depends on the firm.
A close-to infallible conversational opener here is: Lavori per la Fiat? (Do you work for Fiat?). The response is almost sure to be a long drawn-out si, followed by an elaborate rant about the current state of the car-maker established by the glamorous Agnelli family, which has inspired devotion and dependancy in generations of Italians.
The Fiat communications office, long wearily resigned to having journalists automatically describe the business as "beleagured", recently got to issue the kind of press release of which most of their kind can only dream.
It was heavy on the bold type last Thursday as they trumpeted the second quarter results for 2005. Trading profit was doubled to €360 million from €181 million a year ago. The partnership-dissolving payment from General Motors pushed net income to €217 million, a huge improvement on a €246 million loss in the same quarter for 2004.
There was more good news from Fiat Auto, which had dragged the group to a record loss. Now losses at the unit have been slashed to €88 million from €238 million this time last year. Added to this, the first official photos of the striking new Punto were released to a very positive reaction.
After years of bleeding cash - not to mention serious boardroom bloodletting - was the apparently-crumbling Turin-based empire finally getting a break?
Well, yes and no. Granted, analysts were using words such as "astonishing" and "absolutely mind-boggling" to describe the results, which naturally hiked up shares in the company. But they were also pointing out that the impressive figures were achieved by cutting costs rather than increasing sales.
One Fiat employee who has been feeling the financial pinch would certainly agree with the latter assessment. Maria, who speaks on condition that her real name is not used, is typical of many Turinese.
The late and very charismatic Giovanni Agnelli drew workers from the poor south to the prosperous, industrial north in the 1950s and 1960s to work for the company his grandfather established.
The children of those immigrant Fiat workers are frequently today's employees, which has given the firm something of a civil service-type feel over the years. But the company's culture has shifted dramatically in an attempt to resolve a series of grave crises.
Maria's father brought his family to Turin from far-away Taranto back in the 1960s and enjoyed a satisfying 30-year career at Fiat. She followed in his footsteps but says she was sent on what amounted to an enforced three-months holiday for May, June and July on two-thirds of her normal pay.
Last Friday, a day after the firm published its impressive results, a communication arrived from Fiat to her home saying another three months (September, October, November - August is an obligatory vacation) on the same rate was needed. She says it was a complete shock.
"Fiat must take me back but I'm afraid - we are afraid - about the future in Fiat. They're not selling many cars. Fiat is in crisis."
Maria describes the current relationship between the company and its employees as "very bad" as families with children, sometimes with both partners depending on Fiat, struggle to make ends meet.
It's a far cry from the heyday of Giovanni Agnelli, who died in 2004. In fact, Italians still feel the loss of the much-loved playboy, closely associated with Juventus, who became Turin's patriarch.
The search for a figurehead of similar stature continues. The family has invested heavily in Giovanni's grandson John Elkann, now vice chairman. Although clearly more than just a handsome face, he is at present seen as introverted and too young - not yet 30 - to have developed his grandfather's charm.
His younger brother, Lapo, is head of marketing for Fiat's car division. He can certainly talk the talk, if the populist tone of his comments about the new Fiat Punto are anything to go by.
"I have to make a product that people want to drive because it is sexy," he was reported as saying last week. "Italians are seen as having good taste and that's something we must take advantage of."
Where now for Fiat? On Saturday the company said it would sell unused areas of the massive Mirafiori plant in Turin and elsewhere in a €70 million deal with local authorities.
CEO Sergio Marchionne is due to meet the Italian Government and unions today to discuss his plans. He is clearly pinning his hopes for reversing the sales slump on the new Punto, forecasting 80,000 sales this year, rising to 360,000 in 12 months. But he has also delivered the ominous warning that temporary lay-offs will continue"as long as necessary".