The resurrection of Fiat in India?

Even if it is a small number, only 0.55% market share, it was the first time since May 2012 that the company sees a 4-digit sales number. The Punto keeps its importance in the mix, no matter the Linea's upgrade. Source: Carsitaly.net and Team-BHP Forum

Even if it is a small number, only 0.55% market share, it was the first time since May 2012 that the company sees a 4-digit sales number. The Punto keeps its importance in the mix, no matter the Linea’s upgrade. Photo by: Overide.in. Source: Carsitaly.net and Team-BHP Forum

More than 1.000 units sold in one month. This result wasn’t possible since May 2012, when sales dropped 53% on May 2011 (the last month of strong growth). Since then, Fiat’s share shrunk from 1,25% in 2009 to 0,29% in 2013 YTD, after several product and distribution problems. Competition became tougher with more offer coming from foreign manufacturers, while the agreement with Tata didn’t prove to be the best thing for the success of Fiat cars. The brand kept its range of products without big changes, while VW, Skoda, Renault and Nissan introduced lot of products with big success. One good example is the Renault Duster in the small SUV segment. Indians keep buying small cars (for taxes reasons), but SUV segment has had a big growth in the last months. Fiat offers the Punto and Linea. One more problem is the size of these cars. Indian regulations indicate that the excise duty for cars length under 4 meters is 12% against 24% for larger cars*. Despite that big advantage, Fiat, which is widely known for building efficient small cars, doesn’t sell any car shorter than 4 meters. The Punto and Linea are good cars, and they are built locally, not only to avoid import taxes, but to offer a better car that fits Indian requirements. Nevertheless, it is not enough, and Fiat must enlarge its offer by producing a small city car. The Uno or Panda could be a hit in Indian roads, but for a reason that is still inexplicable to me, Fiat is still one of the few car makers that doesn’t offer any city-car in India.

Despite current macro economic problems with continuously increasing fuel prices, high interest rates and a falling rupee, Fiat has been able to increase its market share from nothing to a marginal 0,55%. Notice that Skoda brand, which is somehow strong thanks to a wider range, sold 1.374 cars in August 2013, with 0,76% market share. In August 2012 it sold 1.789 units, with 1,04% share. Source: Team-BHP Forum

Despite current macro economic problems with continuously increasing fuel prices, high interest rates and a falling rupee, Fiat has been able to increase its market share from nothing to a marginal 0,55%. Notice that Skoda brand, which is somehow strong thanks to a wider range, sold 1.374 cars in August 2013, with 0,76% market share. In August 2012 it sold 1.789 units, with 1,04% share. Source: Carsitaly.net and Team-BHP Forum

But things are getting better. After the end of the distribution agreement with Tata, in which the Italian cars were sold in Tata’s dealerships, Fiat took control of the final sale and opened its own dealers in some important cities. Now the Punto and Linea don’t have to compete with the Tata Indica/Indigo in the same place, and Fiat can differentiate its dealerships with a special touch in its ‘Fiat CaffĂ© stores‘. Besides, they improved the offer by adding a Turbo-Jet engine to the Linea. That’s how in August 2013 the brand sold 1.003 cars, up 113% on August 2012, and even more units than July’s record of 928 cars sold. Even if YTD figures indicate that Fiat sales have fallen a massive 49% (in January and February sales fell more than 80%), after two consecutive months of positive growth, maybe is the time of the resurrection of the brand in that country. It is quite early to determine that this trend will continue in the next months, but at least the effort made has finally had a result. The next step is to introduce a sporty Abarth Punto and Jeep brand, but these products won’t help in terms of volume but in terms of image. I insist on bringing the Uno as the entry car of the brand. That’s how Fiat will be able to gain more market share.

* Source: Business Standard

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8 responses to “The resurrection of Fiat in India?

  1. This is incomprehensible. Fiat sales’ are very great in Brazil, why they dont offer successful popular Brazilian cars in india, like Uno and Palio?

  2. Evn we are also not able to understand why fiat is not offering uno,palio,panda in india???palio was one of the best hatch from fiat and palio stile looks was killer bt due to bad after sales thanx to tata,no tvc abt new palio in tv, dated interior flops the palio bt if nw fiat relaunch the palio stile with 2nd gen palio with lots of tvc surely this time palio going to be a big hit. The main problem here is brand awareness many peopl still doesnt know abt fiat and abt palio stile. Bt i think as awareness about the brand is increasing nw if they launch a small car like palio/uno surely gonna be a hit

  3. I think the names like uno and palio give nightmares to some old fiat customers who had some sleepless nights over spare parts availability a decade ago. so fiat needs to improve their sales and spares network on a larger scale before coming out with a volume product. if the mistakes of the past are repeated that would be last nail on fait’s coffin, with tough competitors all around. but glad to see improvements in those areas and its being reflected in the monthly sales. introducing abarth and jeep products might do a lot of good to the brand awreness.

  4. Fiat produces 75% of Indian diesel engines, 1.3 multijet available on Maruti-Suzuki, Cheverolet, TATA (Read this on same site). But less then 1% of Cars are Fiat, thats strange. Biggest mistake fiat did was, JV with tata for sales and services. That actually worsened the image and sales figure. For better future, and to have more than 2% of market share, I would suggest 4 things in quick succession. 1 Fiat Panda or Sedici in small SUV (7 Seater) Avatar. But, it should not look similar to Mahindra Quonto 2. Fiat viaggio, with 1.6 MJD engine. 3. Better gear box for Linea and Punto. Because, same engined cars, Maruti Suzuki and TATA , are producing better acceleration and mileage. 4. Entry level Fiat with diesel option. Uno or Punto is fine but name should be changed.

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