Confirmed: Fiat Setting Up Separate Sales & Service Network


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There are some rumors or say breaking news, that Fiat may start its own dedicated showrooms and service centers.

However it is going to happen in a phase wise manner.

I understand that Fiat is coming up with its own dedicated showroom in Bengaluru soon.

EDIT (2nd May 2012): Please visit this link for official confirmation and press release.
 
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Akash

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Good move. I think FIAT must have been worrying due to its falling sales. And frankly most of the people wish to remain away from FIAT because of TATA. Though FIAT services are quite good even though its a part of TATA, not many believe this. Only ones who have experienced it have faith in FIAT.
 

AMG

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People still dont believe in Fiat A.S.S

Breakaway from Tata will make matters worse.
 
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Yes its a good move, but make no mistake Fiat in India is nothing but half Tata. So Tata and Fiat must have taken the decision together. Afterall, more fiat sales means more profit to Tata as well.
If its true, its good that Tata accepted the issues with their service centers and finding some alternatives together.

People still dont believe in Fiat A.S.S

Breakaway from Tata will make matters worse.
I think thats why they are planning in phase manner to see how people take this move.
 
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Fiat reworking strategy to spur sales in India

Source - Fiat reworking strategy to spur sales in India - NDTV Profit
Dissatisfied with monthly sales for its car line in India, Italian car maker Fiat SpA is doing a serious rethink on its India strategy. While the company had initially aimed at sales of over 4000 units combined of its Linea and Grande Punto, it is barely reaching even half that number.

So now, Fiat has hired an independent consultant to rework its sales strategy in the Indian market. The point of contention is the shared dealer network between Fiat and Tata that is not delivering on targets.

Fiat’s short term objective is to increase sales of its existing car lines and also incorporate future variants and new models that are planned over the next 12-18 month period.

This also means a series of discussions with its joint venture partner Tata Motors. Tata is also involved in the new model rollout and positioning strategy.

So at this stage – it would be impractical for Fiat to think of going it alone in India.

"Creating distribution network from a scratch will entail huge investments. The company will also lose a lot of time in building the required infrastructure," said Kapil Arora, partner- advisory services at Ernst & Young.

It would also mean reversing the grand merger of the two retail networks that was carried out in 2007 when Fiat's 40 dealers and Tata's dealer network of over 100 were gradually combined. Today the total joint-dealership strength stands at 175 which will hit 200 dealers by the end of 2010.

Splitting dealer network may create complications for Fiat, which will have to make huge investments in re building distribution network. On the other hand, Tata's Indica Vista and Indigo Manza use Fiat powertrains.

Fiat has a joint venture with Tata Motors through which they share production facility at Ranjangaon in Maharashtra and distribution network as well.

Over Rs. 4000 crore have been invested in Ranjangaon – on land already with Tata Motors. Ranjangaon has the capacity to make 200,000 cars and 300,000 engines, some of which are also exported to Fiat plants overseas.

Tata also has a supply contract for its Xenon pickup to Fiat in the Latin American market.

Both companies strongly deny any friction between them but analysts believe that eventually the two will have to explore separate retail networks while maintaining a joint sourcing and manufacturing operation.

Any decision by the two companies will also have to keep global implications in mind. After all Tata Motors is still keen on exploring synergies with Fiat group CV-maker Iveco in the commercial vehicle segment.
 

AMG

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Here is what happened, IMO

Fiat offers better margins than Tata.

Dealers tend to push Fiat over Tata.

Tata gets put off at this betrayal by their own dealers.

They decide to part ways.


Disclaimer: The above views are a figment of my imagination and in no way represent the views of any official.
 

vijay

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what ever may be the real scenario, but not a good sign for fiat india, as it had taken quite a big dig inside to gain confidence from people for their brand value, yes tata services are not as good as other companies, but then thats also the reason people started buying fiat products as well cause a major automobile company was there to repair fiat cars, wont be easy to part away with their JV i believe.
 
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No i would not call it wise from Fiat. If they part ways now , Fiat will have to invest huge amounts in setting up service stations and dealerships. They will not be able to cover up many places. Then they would become a brand like Skoda , Nissan etc and move further away from the volume segment!
 
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I much awaited move, I would say. FIAT should establish their own. I was not able to understand why they underestimated themselves in India. Moving out of Doshi group was a wise decision, but made very late after seriously burning the their fingers. The same holds true with TATA. TATA knows what they want. I have not found any sales man in TATA showroom, eager to sell FIAT. But I have met couple of sales persons telling that Linea has a very bad GC thus pushing Manza.

Even though they will have to face some hick ups in the initial period, I think this is the best decision for long term. If Hyundai and other can do that in India, why not a global player like FIAT?
 
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FIAT should learn from nissan and VW.
VW with less than 50 dealerships across India and practically only one model that is a volume seller, is selling more cars in India compared to FIAT with over 150 dealerships!
Even nissan is nearing 1.5k sales mark!

FIAT should rather than moving away, open its dedicated dealers while being in the JV. In Jaipur a dedicated TATA showroom opened a few months back. If TATA can do this even FIAT should.
I also heard that a dedicated FIAT showroom is opening soon in bengaluru.
I hope this is true.
 
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good move to work independentely but am very fearful that how will they manage? those 100+ dealerships they were doing ga-ga about were only becoz of TATA and now they need to start from scratch again??!!
 
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