Iveco, the 9.6 billion euro commercial vehicle business of the Fiat Group, is looking at joining hands with a local partner to enter India. Speaking to Autocar Professional at the sidelines of the 2012 IAA Show in Hannover, Alfredo Altavilla, CEO, Iveco, said: “The only way to be successful in India is to be with a partner.”
It is learnt that Iveco is already in talks with companies exploring a possible partnership. Altavilla indicated that the partner could also be a company which is currently not present in the commercial vehicle industry.
The growth opportunity in India has attracted key global players like Daimler, MAN, Scania, and Volvo to design strategies to gain foothold in the market which sold nearly 350,000 medium and heavy commercial vehicles during 2011-12. “India as a market is difficult to penetrate without a strong local partner. It is one of the important markets in the world. It is on the topmost priority list of mine,” says Altavilla. He declined to comment on Daimler’s strategy of an independent business entry into India. Daimler is set to commercially launch its first set of products under its newest BharatBenz brand on September 26 in Mumbai.
Altavilla, who has worked closely with Fiat boss Sergio Marchionne, had earlier played a key role in Fiat’s alliance with Tata Motors in 2005. A separate memorandum of understanding (MoU) was signed between Iveco and Tata Motors in 2007. The MoU encompassed a number of potential developments in engineering, manufacturing, sourcing and distribution of products, aggregates and components, but that hasn’t taken off yet. However, Altavilla indicated that the market entry may not be in partnership with Tata Motors. “Tata already has an extensive line of products. They will keep on playing by themselves,” says Altavilla.
Iveco’s peers have either entered or close to entering the Indian truck and bus market. In a market that is dominated by homegrown companies Tata Motors and Ashok Leyland, it will get increasingly more challenging for any newcomer to enter and make a mark. Iveco will have to decide fast to better its chances for success in India. Autocar Professional