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FIAT India Sales

Discussion in 'Fiat India News' started by amogh, Feb 5, 2015.

  1. prabhjot

    prabhjot Esperto

    Messages:
    2,455
    delhi ncr
    @Raj_pol

    Even say a 100 Abarth punto-s and Avventura-s a month, selling undiscounted, mean a lot: not to FCA India's balance sheet, which is overall healthy regardless, but to dealers.

    FCA under Marchionne will NEVER even attempt the sorts of thousands of crores worth of loss-making gambles that Carlos ghosn has been attempting for years in india, all with the fixation that India is third-est-world of third-world markets. They must be regretting the sales-bookings success of the KWID: they will spend forever making a single rupee from the KWID project in India. And will likely end up entrenching a long-term contempt and mistrust for the Renault brand and its dealers here, just as they've un-achieved with Nissan and with Datsun, just as FIAT suffered at the time of the Uno and the Palio (initial years) though those were vastly superior vehicles to the likes of the Duster or the Kwid. Sales numbers have little-to-no correlation with profitability in india, as Renault-Nissan's own example or VW-Skoda's or Ford's (relative FIAT or TATA) in the past 3-4 years reveals.

    FCA's business model in india is sounder than anyone else's in the indian marketplace, given their under-priveleged brand-trust-positioning: a jv plant, engine etc sales to outside firms, lots of exports of r&d services as well as components+powertrain exports, etc: highly capital-efficient and capital-efficacious, with THE real lesson from Carlos Ghosn and Renault-Nissan in India already being learnt and the learnings being applied to the JEEP c-suv and/or the all new 2017+ FIATs: export, export, export first, 'make in india' but do not (mostly or primarily) 'sell in india'.

    It is just that they have to underwrite the dealers and keep-up the brand-reflation going through to 2017, when the all-new models come, with of course JEEP launching in early-mid 2016.

    IMO they should do the opposite of the Kwid/Duster strategy: go premium, keep up the euro-spec engineering and build/drive quality, 10-lakh plus, even upto say 15-16 lakhs, with the siblings of the JEEP c-suv they'll be making and localizing: the 500X and/or 500L and/or Aegea sedan+crossover-hatch and/or the Renegade, with a Punto-replacement too of course. An entirely viable strategy IMO since many or all of these models could be very export-biased, not necessarily only to rhd markets, including the Punto (Italian Punto production will be over by 2016 and there are no italian or serbian or polish or turkish FCA manufacturing plans for a new affordable non-500-type punto for any part of europe). BUT: sharing the same platform dimensions, powertrains and most sub-assemblies and modules.

    PS: Treat the Indian market like Europe or at least turkey FCA, even if it does not deserve to be! ;-) Well we'll forgive the odd cheaper chassis member, the odd torsional rigidity and crash-standard lowering, the odd torsion-beam rear suspension, maybe even the odd epsteering by way of adapting to Indian (non)tastes. What say, Kevin my 'bloke' or should i say 'yaar'? Could you have this financial/investment-strategy-product word with Mike Manley? You should 'mate'! ;-)
    Turbothinghy, cassini, limraj and 5 others like this.
  2. limraj

    limraj Superiore

    Messages:
    915
    Trivandrum
    Linea 1.3
    Turbothinghy and Ravi like this.
  3. Turbothinghy

    Turbothinghy Superiore

    Messages:
    833
    Pune
    Punto Evo 1.3 90 HP
  4. Raj_pol

    Raj_pol Regolare

    Messages:
    497
    Bangalore
    Punto Evo 1.3
    @prabhjot Unless I see something concrete like balance sheets I will refuse to believe that a company will invest in a product like Kwid, advertise like hell and then sell so many so that they can be loss making till the product life cycle ends. Carlos is smarter than that and smarter than us considering he runs a global car company. In a similar vein, you are saying Maruti has been making a loss on every Alto sold for like what the last 30 years. Absolutely no - they are making profits and hence they continue to sell those products.

    Fiat neither has a brand recall nor a good image in India. They cannot hope to do that by selling 100 cars a month. As I have mentioned the each of the German trio sells more than 10 times that every month. So, somewhere along the way they have to reach volumes of at the minimum say 3k to 5k a month to sustain in India.

    The profitability you keep talking about is only by selling engines - it has nothing to do with selling cars and you should not be merging both. If they go your way, then they will change from a car manufacturer to an only engine manufacturer in India. That will make them profitable but then their will no longer be any Fiat brand in India.

    I also stand by my view - that they have done absolutely zero investment so far in India. They took 6 years to get the T-jet in the Punto. (Note: The Abarth has generated mostly very positive reviews with some mention of the gearbox which probably is not as smooth as say a segment benchmark like the TSI or even the Swift. This shows that people do appreciate a good product and are not entirely biased against a FIAT).

    What Fiat needs probably is maybe the Punto in a different avatar with all the bling included and with an automatic. Considering the chaos in our cities what most of my average friends are looking forward is an automatic above all else.
  5. Tornado

    Tornado Superiore

    Messages:
    682
    Driver's seat.
    Western Maharashtra
    Avventura 1.3 90 HP
    Common Indian buyers need to understand that fiats make heavy built cars for the safety of life & limb of the buyer and not for reducing FE. And if at all buyers are concerned with FE they should put pressure on government to sell the fuel at a price equivalent to prises in international market.
  6. prabhjot

    prabhjot Esperto

    Messages:
    2,455
    delhi ncr
    @Raj_pol

    The KWID in not Caros ghosn's first attempt at this 'third world car with some lipstick/looks' approach. Renault-Nissan have made not hundreds but thousands of crores of losses so far in india. Google their financial news: and this is despite the first-mover 'success' of the Duster.

    It is exports, and state-government subsidies, alone, that keeps them on in india, with profits a very distant prospect, KWID or not.

    FCA under Marchionne and Manley will never attempt such a 'roll the cut-price Indian dice' approach, that much is clear. Under Marchionne FIAT does not do ANY such 'loss leader' models, models that make no money or even accumulate losses but are made and sold in the hope of longer-term brand improvement and upgradation sales of the loyal customers, which the Carlos Ghosn strategy. That is a company/brand policy for FIAT under Marchionne, has been for years now, EVEN in emerging-market Brazil, where too the strategy currently in implementation there is to 'premiumize' the offering, NOT take it lower.

    As I've posted many times before: FIAT is too honest and true to its brand history and values, too ethical a firm to attempt such strategies. Besides, the strategy you advocate is self-refuting: if the brand image and trust is low (other than among cognoscenti) how are FIAT tin cans with touchscreens and bling going to sell in the first place?

    Renaut can do this sort 'third-world crap' approach since it has NO brand identity and history/legacy/burden at all in india.

    For better and not only for worse, FIAT as well as JEEP have such an Indian history/legacy/identity/burden/problems, uniquely so among all the come lately MNCs like Renault, Nissan, Chevy, VW, Skoda, even Ford.

    What they've begun with Abarth (although it will not yield that many additional sales) is the ONLY and right way to go: compete on USPs, which must necessarily be either of the sporty (Abarth-s) or the premium-Euro-styling+design+engineering but at-great prices (e.g., Aegea sedan or say the 500L or even if possible costing wise, some avatar of the 500X and Renegade) variety

    OR both.

    After all one undiscounted Abarth Punto or say undiscounted JEEP or say for eg 500X or Aegea sedan would have margins for dealers and for FCA, who knows but what: 5 or even 10+ times as much as cut price, cut-throat-discounted model that makes money ONLY if volumes are in the tens of thousands every year.

    Volumes are poorly corelated with profits and even dealer-viability in the Indian marketplace (other than for Maruti, Hyundai and Mahindra). Better to strive for enough volumes with enough non-discounting and margins to keep your mere 100-120 odd dealers viable and happy-enough, than to bet hundreds of crores on a miniscule margin, low-quality model like the KWID.

    Besides, Renault, Dacia and Nissan operate in so many low-cost 'third-world' markets, especially in Asia-Pacific and Africa that FIAT or indeed JEEP do not exist in: they can, if volumes do not meet expectations export out of India such vehicles, that is what makes Carlos Ghosn keep investing in India: his downside risk is limited.

    FCA India has no markets to export a low-cost+quality vehicle out of India to. And so it is most unlikely to take such a route. Instead, they will likely and hopefully take the route for the all-new FIATs that they are with the to-be-made-in Ranjangaon JEEP C-suv: India as export base for vehicles of a 'certain' class, quality of design and engineering, and that fits its brand-identity and character abroad (e.g., in rhd Japan or rhd Australia or even rhd UK?) If not for whole-vehicles then for r&d, powertrains, sub-assemblies etc. That way the Indian retail operations benefit too.

    FIAT can succeed here (in terms not only of profits but even of sales turnover) ONLY by being export-centric, one feels. Meanwhile the 'low end' profits accrue via Tata and Maruti. So, in fact, FCA covers both the low, 'kwid' end of the marketplace (albeit vicariously) and so THE obvious thing to do is to position the brand and its export-quality new offerings for 2017 onwards in the c2-d1 segments only.
    Last edited: Nov 10, 2015
  7. acechip

    acechip Superiore

    Fiat would have been on top of their game had they not been lazy during the 2009-2012 period, and had worked out their relationship with Tata. The level of sales/marketing was the absolute pits at that time. Renault came from absolutely nowhere and worked up a brand (for whatever its worth). So the comparison itself is not correct. And last I checked, I did not see a mad rush for the Avventura when it was launched with a regular 90 Bhp diesel and a somewhat anaemic 1.4 petrol, inspite of competitive prices. I can see the same mad rush for cars like the Baleno and the Creta. Ultimately, there are real concrete (and not perceived) reasons behind the success and failure of products. Renault rested easy on the Duster's success and did not come up with different interior/transmission and got hammered by the Creta in last 2 months, only to redeem themselves somewhat in October. So whatever they are doing to establish themselves in the Indian market via Kwid , all credit to them. I speak not as an auto enthusiast, but as an observer of the market. What is Fiat doing? Not even one single TV advt for the Abarth twins. No sponsorship of major events. No brand ambassador after Sachin Tendulkar. He is still good enough ! And likes fast cars. Why not approach him again ?
    Last edited: Nov 15, 2015
    Raj_pol likes this.
  8. Raj_pol

    Raj_pol Regolare

    Messages:
    497
    Bangalore
    Punto Evo 1.3
    @prabhjot Fiat with it's current lazy effort at both sales and marketing will not even sell what they are doing right now if they come at c2-d1 segments. You really think people will buy a no name brand (jeep is not widely known in India) for the price of a Pajero. No they will not. The low sales is due to systemic weakness and not understanding the market. Give it to Hyundai and in a smaller way to Renault man - they are making progress. Even Ford is releasing car's with obviously less heavy structures but they are going the way the market wants them to.
  9. acechip

    acechip Superiore

    Look at it this way- an utterly hideous mishmash of a design (my 3-year old niece can sketch better) in the form of TUV300 has been launched with some degree of success (atleast going by dispatches). When Fiat launches the B-CUV or Jeep CUV, people will say it is a copycat of Mahindra, when it really should be the other way round ! What prevents Fiat from taking more urgent steps is precisely what makes others successful.
    Revv, Raj_pol, prabhjot and 1 other person like this.
  10. asimpleson

    asimpleson Esperto

    Messages:
    3,000
    Heptanesia
    Linea 1.3
    @acechip, diesel SUVish mini thingum anything with automatic will sell !!

    EDIT: Meanwhile Baleno has received 21000 bookings as per one report.
    Suzuki Ignis too India bound..
    Last edited: Nov 15, 2015
    prabhjot likes this.

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