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Fiat India - Future Plans

Discussion in 'Fiat India News' started by Ravi, Dec 6, 2012.

  1. Ravi

    Ravi Staff Member Janitor

    Grande Punto 1.3
    Fiat wakes up. Now with Chrysler

    Yesterday Fiat announced its new roadmap for India. At the press conference, Enrico Atanasio, Fiat’s India managing director said, “We are optimistic about our prospect for growth in the Indian car market, which grew 12 percent in 2011 and is rapidly becoming one of the major markets in the world. With the launch of the Jeep brand, new Fiat products, an expanding dealer network and upcoming marketing initiatives, we will be in a strong position to capitalize on this growth.”
    Except that for people following this sector, this announcement comes as no surprise. In the last decade alone, Fiat has said it twice that it is going to get its act together in India. But none of those announcements have borne fruit.
    Let’s look at where Fiat India stands today. The company sells just under 600 cars every month. That’s a very low number for the 7th largest car company in the world in the 5th largest automobile market in the world. To put things in perspective, other multinational companies which have seen far less of India, like Volkswagen and Renault-Nissan among others are doing more than 5 times Fiat’s volumes. So yes, things are bad at Fiat.
    A quick recap: so it has happened after Fiat bungled its partnership with Premier Automobile group back in the 1990s. It happened after they came in all alone in the late 1990s and soon exited the market. It happened after Fiat found a new partner in Tata Motors way back in 2005. And now it is happening all over again in 2012 when Fiat wants you to believe that Chrysler, the US auto maker that Fiat Group bought a couple of years back will play the rescue act in India. At the press conference today, Enrico Atanasio, managing director of Fiat India said, “We are at a much lower level today. But we know that we have a long way to go.”
    Let us get to the most important points of this new roadmap.

    1. Fiat says it is a company in a transition phase. They will spend a good amount of time in setting up their own distribution channel in terms of dealerships and service outlets. Which means you won’t see any more of Tata Motors. To quote Atanasio, Fiat will offer you a real Italian experience into the car world. Their target is to set up 120 independent dealers by 2013.
    2. Fiat wants to increase its market share from a paltry 0.7 percent today to 5 percent in 2016. Tarandeep Singh, principal at Boston Consultancy Group says this number looks ambitious. “To reach there, Fiat will have to fight multiple competitors looking at 5 to 10 percent share,” he adds.
    3. Fiat will be launching two new brands from the group; Chrysler and Abarth.
    4. As a part of this growth strategy Chrysler will launch the Wrangler and the Grand Cherokee sports utility vehicles in 2013. Two other SUVs will be launched from the Jeep stable in 2015 and 2016. Most likely they will have very little localization levels and will be sold through Fiat’s distribution network.
    5. Fiat will launch a car called Linea Classic in 2013. A new Grande Punto and a new Linea in 2014.


    The Jeep Wrangler
    My sense is this roadmap doesn’t have much to offer. Here’s why.
    Fiat’s current crop of cars, the Grande Punto and the Linea are not selling. In 2012, Fiat should have sold about 9, 000 cars in a market of 2.6 million vehicles. Now if they have to increase their market share to 5 percent by 2016, here’s the number of vehicles they will need to sell. The Indian automobile market in 2016 is expected to be about 3.7 million vehicles. 5 percent of that number is 1, 80, 000 vehicles. Yes. From 9, 000 to 1, 80, 000 in 4 years is a very big climb. Let’s understand why.
    In India, more than 50 percent of the market is still made up of small cars. That’s where Maruti Suzuki and Hyundai are strong players. Fiat doesn’t have a single small car in its product pipeline till 2016. “The only way Fiat can make a comeback is by offering a car below the Grande Punto. Because if you look at it then they have already lowered the price of the Linea to a great extent and perhaps are losing money on it,” says Deepesh Rathore, managing director of IHS, an automotive consultancy firm.
    The Jeep is not a mass market vehicle. There is no doubt that it is the world’s most well regarded SUV. Mike Manley, the COO for Asia and the president and COO of the Jeep brand had all the right words for the Jeep; styling, functionality, capability and extreme off road. What it will get Fiat is the halo brand effect. “From a strategy point of view, this is the right message. Some bit of the Chrysler image will rub on to Fiat,” adds Ghai.
    But it will not get you the numbers. That’s because it will be launched in a segment and at a price range where it will compete with the premium car makers – like BMW, Audi, Mercedes and Land Rover. Despite the fact that the SUV market in India grew at a rate of 17 percent last year, in actual volume terms the segment is small. As of today, not more than 3, 000 cars per year. Experts believe that there is not much that Fiat can do in the localization department either. There is little chance that the 3 liter diesel engine (for the Jeep) will be made out of Fiat’s current facility in Ranjangaon, Pune.
    So this is where the new roadmap falls flat. Fiat needs mass market cars from the Fiat brand. And it needs them quick. That’s because other multinational companies have upped their game here. Right from Ford to Honda. Rathore says that is the last chance for Fiat. “If they don’t make it this time, then they will find it extremely difficult to come back,” he adds. Unless of course there is a partnership with a major car maker in India in the future.

    Source: Fiat wakes up. Now with Chrysler | Forbes India Blog
    Last edited: Dec 7, 2012
    11 people like this.
  2. jayadev

    jayadev Esperto

    Kannur, India
    Grande Punto 1.3 90 HP
  3. Vikrant Joshi

    Vikrant Joshi Regolare

    I sincerely wish that the above news is true. Was wondering the absence of Fiat 500L from the updates. Mid 2013 launch would be great !
  4. gurus

    gurus Amatore

  5. amit

    amit Superiore

    Navi Mumbai
    All posts below are quoted from Autocar India.

    On Abarth:

    On Fiat's new model line up:

    6 people like this.
  6. gurus

    gurus Amatore

    I really wish to know the reaction of dealers who applied for dealership after hearing about this product lineup. I'm sure they would have heard this before.
  7. shams

    shams Esperto

    Fiat-Chrysler’s Chennai tech centre gets into reverse innovation

    The Fiat-Chrysler alliance, on Thursday, had announced aggressive plans for the Indian market, with a suite of nine vehicles to be launched over the next four years. But the company’s little-known engineering and technology centre, Chrysler India Automotive, has been doing significant work for the group over the last five years by focusing on innovation.

    Set up in 2007, the Chennai-based centre is the global services arm for Fiat-Chrysler, its engineering hub for the Asia-Pacific region, and is the largest outside Turin and Detroit (Fiat-Chrysler headquarters). Initially it catered to needs of the North American market and the Chrysler Global platform.

    “We started out with computer aided engineering, electrical, vehicle interior, chassis and exteriors,” Nagesh Basavanhalli, Managing Director, Chrysler India Automotive Pvt. Ltd, told The Hindu .

    “Our idea is to add value and the measure of our success is the value addition we provide,” he said.

    As one of the Group’s four global centres, the Chennai centre also focuses on innovation. “Among several projects, we designed seats for Chrysler’s C segment Dodge and designed the interiors for the Viaggio in China. We are now also doing ‘reverse’ innovation, providing innovative solutions from existing products,” said Mr. Basavanhalli. “We developed a ‘fuel-filler door’ through this and now hold a patent for it. We own several other patents and several are pending approval.”

    Brazil, APAC

    While the customers for the engineering hubs are essentially Fiat-Chrysler units in Detroit, Brazil, Shanghai and Turin, the Chennai centre is now focused on Brazil and the Asia Pacific.

    The centre’s other activities involve sourcing components through vendors out of Southeast Asia and supplying to North America.

    Source: The Hindu : Today's Paper / BUSINESS : Fiat-Chrysler
    2 people like this.
  8. nk4FIAT

    nk4FIAT Superiore

    Aapne to meri muh ki baat cheen li.
    See my follwing posts with photos.......
  9. raj29

    raj29 Superiore

    All news is very exiting and positive, but FIAT really needs to get it right this time not just in the sales department but the highly questioned Service/Spares department too.
    FIAT will need a small car below the Punto to be able to generate the numbers its trying to project for the near future. The much talked about FIAT small car to comete the likes of Alto needs to be introduced first IMO. OR may be FIAT is waiting for the entire Sales and Service setup to be completed before they sell the small car for which they might be expecting high volumes !!
    Last edited: Dec 8, 2012
    1 person likes this.
  10. Sree3070

    Sree3070 Amatore

    Its good to know that fiat has aggressive plan for india and they are coming up with new models.. but when are they coming up with service center chain. thats the first thing they need to sort it out. sice long we are hearing that new showrooms abd service centers are coming up however noting meterialised.


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