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Thursday, December 18, 2008

FIAT: A New Start Once Again

We all know that Italian automaker company, FIAT(Fabbrica Italiana Automobili Torino) is one the oldest automobile companies that started its operation and business in India. Its really shocking to hear that the present leaders of car makers in India like Maruti Suzuki and Honda Siel are celebrating there 25th and 10th anniverssary respectively in India but FIAT has already completed its 100 years anniverssary a long time back only.
And even there was a time when the Car of the Indian President use to be FIAT, then what went wrong that this company is struggling now to grab its market share rather we can say its trying for its survival in India. I tried to look on some of the factors and also tried to give some lights on the future plannings that are now been taken by FIAT to grab its market share in India in coming years with a bang.

No doubt that FIAT still had a good market share worldwide and its one of the car makers which is known worldwide for its design and ride quality that it offers to the consumer.But when we talk about India where it started its operation long back around in the year 1905, the story is totally different. FIAT has loosen its market share to its new competitors which entered in late 90s like Maruti Suzuki, Hyundai and Honda Siel. After that time its playing a loosing game in India and even after its various strategies and new launches to grab the market nothing seems to be going in favour of FIAT.

It introduces Palio and it was the first hatchback car for Indians but it also didnt able to create any impact since very sooner its competitors also launched there products which were more economical in terms of mileage and maintainence as compare to FIAT's offering Palio.And even from long time back to till that date FIAT was suffering with its after sale service since it doesnt have good number of service centres across India.However if we see from FIAT's point of view than Palio has done very well job as compare to its predecessors like FIAT Uno, FIAT Sienna and etc. But everything failed from FIAT's side and none of the new model launches able to create any impact in Indian market. The models which FIAT offered to Indian Consumers are: FIAT Palio( in different variants); FIAT Adventure 1.6; FIAT Sienna; FIAT Petra; FIAT Uno and so on.

Now whats the wrong decisions that FIAT has taken that made its current position like a looser in India. The some the factors which if FIAT has taken into account in its early days and worked on this factors then it might have changed the scenario. The factors which i felt responsibel for setback of this company are as follows:
  • Costlier cars in every terms that includes purchase price and its maintainence as compare to its competitors offerings;
  • Non-availibility of service centres in good numbers in India;
  • Very poor after sale services by FIAT dealers;
  • Above factors leads to a low resale value for FIAT cars.
Now i think FIAT has understood its mistakes and thats why we saw a Joint Venture between Tata Motors and Fiat last year and after that it has improved its after sale service since with this deal now the FIAT cars will be given after sale services by TATA motors, which had a second number of service centres in India after Maruti Suzuki.So no doubt FIAT solved its one major problem of after sale services in India with this Joint Venture.

And even FIAT knows the Indian market and it doesnt wants to quit from this market, thats why only it started revival of its strategies once again for India and announced a number of new launches for Indian market. With this FIAT has also stopped production of its all old car models in India.

FIAT Palio Stile
It launched Palio Stile petrol variant last year with new exterior looks and with a new fuel efficient F.I.R.E engine of 1.1 litre and also one more variant of 1.6 litre engine which it called as Palio Sports 1.6 so that it can also attract those consumers who loves earlier FIAT Palio for its power.It was the first model launch from FIAT's upcoming launches. With this launch it has attracted consumers since it has solved two problems of mileage and after sale service for FIAT cars.Its pricing has been kept between 3 lacs to 4 lacs ( On Road in Delhi) for Palio Stile 1.1 variants where as Palio Sports comes at a price of 4.5 lacs (On-road in Delhi).But this year we saw a new launch of Palio Stile in diesel segment which comes up with 1.3 litre Multi-Jet Diesel engine and with a new red FIAT logo. With this launch, FIAT has tried to attract daily commuters who needs diesel vehicles at cheaper cost and also offers a good mileage. In this case Diesel Palio offers 26 kmpl ( as per company and its in ideal conditions) and its comes up in between 4 lacs to 5 lacs (On -road price in Delhi).

So now at present FIAT is offering only three models to Indian consumers one is Palio Stile( petrol variant) and another is Palio Stile Multi-Jet (Diesel Variant) but along this two cars FIAT is also offering FIAT 500 to the Indian Consumers which comes up with a hefty price tag of 15 lacs (On-Road in Delhi). However this car is not been manufactured in Indian FIAT factories but it has to be imported from Italy after you book this car. Even according to company FIAT 500 is only launched in India for a special segment of peoples rather than for masses and thats why its not been manufactured in India.FIAT 500
Fiat India has launched the FIAT 500, a two-door lifestyle car come in April 2008 and which will carry a price tag of, hold your breath, Rs 13 lakh (Rs 1.3 million) plus.It is being launched as an image building exercise for FIAT in India after years of struggle in the highly competitive Indian market.

FIAT is riding the New 500 wave across Europe since its July 2007 launch and has also collected the coveted European Car of the Year 2008 award.The car competes with the BMW built Mini, yet another retro designed lifestyle car in Europe. The fight will continue in India as well as BMW is planning to bring the Mini to India too.

Though only 3.55 metres long, the New FIAT 500 is safer than some of the bigger cars and has already received a five star rating in EuroNCAP tests. The car features seven airbags (an industry first for a car in its class) including a knee-bag. All cars feature electronic stability programme - yet another luxury car feature.

The Fiat 500 as well as the Mini will come through the CBU (completely built unit) route, hence the stupendous price tags. The FIAT 500 is currently available in two variants- Lounge and Sports.This car also got a tage name of " BABY FIAT".The FIAT 500 expects celebrities, youth and auto enthusiasts as its target customers. The 500 sports comes with a 4-cylinder, in line engine that delivers 75bhp@4000rpm. The 1248cc Multijet engine is capable of peak torque of 145Nm@1500rpm.

And as per company reports, FIAT has already sold 41 new FIAT 500 after its launch in April 2008.

Upcoming Models
In upcoming models FIAT was planning to launch its mid-sized FIAT Linea by December but after Mumbai Terror attack, company has shifted its launch to January next year.FIAT Linea will compete with Hyundai Verna, TATA Indigo, Maruti Suzuki SX4 and with FORD Fiesta. After Linea, FIAT will launch FIAT Grande Punto in between 2009 which will compete with Maruti Suzuki Swift, Hyundai Getz and latest Skoda Fabia. Followed by Grande Punto launch, company is also planning to launch FIAT Bravo in India by next year 2009 only. And if all this models get good response in market then sooner you will see a number of launches from FIAT since the company has almost 30 models in its bag but just waiting for a appropriate time to launch them in India. Now lets have a brief look on the upcoming three models from FIAT: Linea, Grande Punto and Bravo.

FIAT Linea
A lot has been talked about this car internationally as well. The Fiat Linea has been designed from dot by Fiat Style Center. The main objective was to design a sedan which would appeal to all. So the car had to look uncluttered yet elegant. Sporty even, if possible! Which the Linea manages to look, with aplomb.The Fiat Linea is not just a Grande Punto with a boot. It is a far cry from that! Linea sports smooth lines and there is a perfect harmony between the sharply raked windscreen, A, B and C pillars and it gives the car a uniform look from nose to tail. The front is characterized by large projector type headlamps which have a ‘Bravo-inspired’ look to them. The grille gives a stubbly look and helps the car look intimidating. The neatly integrated fog-lamps also add to the look. The rear is dominated by a simple yet attractive boot and those tail-lamps endows the behind with a luxury-car look. Standing at over 4.5m in length and 1.7m in width, the Linea is 1.5m tall and carries a wheelbase of 2600mm. It looks stunning, specially in profile. A gorgeous machine this.

Fiat has always been known for good ride and handling compromise, so it will be business as usual for Linea as well. Expect comfy ride quality and dynamic handling with accurate steering response and a delightful gearbox. Hope Fiat has gained knowledge from its past experience and will offer the Linea with all the safety and luxury options like ABS, airbags, climate control, leather upholstery etc.The car will also come up with a BLUE & ME Device.An array of engines are there in Fiat’s kitty that it could offer the Linea with. A 1.3-litre multi-jet diesel that already powers the Swift could come in as an entry-level diesel option which will be complemented by a 1.4L diesel and petrol option too. It is our personal wish that the Linea be powered with a 1.6L petrol motor in addition to the 1.9L diesel. Giving another petrol option might be a 1.4-litre, 78bhp engine.

Expected Price: 6 lacs - 8 lacs
Expected Launch: January 2009

FIAT Grande Punto
A car that would appeal to the masses and bring in good numbers. The Grande Punto was just that.It turned around Fiat’s fortune in a way that could be possible only in dreams. The Grande Punto is the third generation of the Punto and was launched globally in 2005. Styled by Giorgetto Giugiaro, the Grande Punto has a beautiful body to exhibit with sloped back headlamps and muscular wheel arches which lends it a mean yet attractive look. The rear section integrates well into the bumper and the large tail lamps give added character to the overall stance of the Grande Punto.The car is likely to offer a choice of three engines. A 1.2L and a 1.4L petrol that pump out 65 and 77 horses respectively will be joined in by a 1.3L multi-jet diesel engine that Fiat is now famed for. This engine is known for its tractable nature and delivers 88PS of power to the front wheels. My speculation speaks that since a 1.6L motor is already on offer in the Palio Stile, something similar might be presented with the Grande Punto as well. The car will be packed with safety features like ABS and EBD, though the same cannot be said about the airbags as of now.

Entering the action-packed B segment, this car will be at war against names like the Maruti Suzuki Swift, Hyundai Getz and Chevrolet UV-A. Skoda will do its bit by making things interesting with the launch of the Fabia in this segment. The Grande Punto will roll out from the Ranjangaon facility of Fiat near Pune. The company revealed that it will have high levels of localization for the car and this should help as far as the pricing is concerned.Expected Price: 4.5 lacs to 6 lacs
Expected Launch: May-June 2009

FIAT Bravo
Fiat Bravo is Fiat's new small family car introduced to the press in January 2007 in Rome, and later at the Geneva Motor Show in 2007. It is the second generation car of the earlier sold FIAT Brava which FIAT sold in International markets. The car was designed by Fiat Style Centre.CAD engineering and computer simulations were used on a very large scale with this model and the design was finished to a very tight schedule.

However much information is not available about Bravo's techinical specification as per as India is concerned because yet no official information is given by FIAT authority regarding this cars engine and pricing.In international market, FIAT is selling this car with 1.4 litre petrol engine and 1.6 Litre , 1.9 Litre and 2 Litre Multi-Jet Diesel Engine. In Australia, the Fiat Bravo will be sold as the Fiat Ritmo, as Mazda Australia owns rights to the "Bravo" name. The Bravo will also be built in Brazil from late 2009 or early 2010, and will be sold there and throughout South America. This cars also come up with FIAT and Microsoft tie up invention device, BLUE & ME.

Expected Price: above 5 lacs
Expected Launch: last quarter of 2009

So with coming years we will know whether FIAT would be able to create any impact in Indian market and build a new position for itself with its new models of Palio Stile and with its upcoming models like FIAT Linea, FIAT Grande Punto and FIAT Bravo.And except the new launches whether its Joint Venture with TATA Motors will help its after sale service and attract customers to buy FIAT cars in coming years in that quantity that it can give a tough fight to its competitors in India as its doing in International Markets.

Compiled By: Saurav Chakraborty

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