Go Back   Team-BHP > BHP India > The Indian Car Scene


Reply
 
Thread Tools Search this Thread
Old 18th August 2011, 03:37   #1
BHPian
 
gshanky's Avatar
 
Join Date: Jun 2008
Location: Coimbatore / Bangalore / New York
Posts: 718
Thanked: 13 Times
Default SCOOP - Is Suzuki looking for a partnership with FIAT?

I came across this piece from Autoblog and have to say is a shocking but not surprising in the indian context since the relationship with TATA has still not brought in the numbers and moolah in car sales .

Quote:
In 2010, Volkswagen purchased 19.9 percent of Suzuki, and the two have been working together in the form of a self-described comprehensive partnership. Apparently, "working together" means different things to the two automakers, however, because neither side is thrilled with the Japanese-German automotive tie-up. So much so, that Suzuki may be looking to take its talents to Italy.

Suzuki currently has a deal with Fiat, in which the Japanese automaker supplies its SX4 crossover for rebadging as the Sedici in Europe. There are reports that Suzuki is looking for ways to expand its relationship with Fiat, yet we've heard no word on whether the Italian automaker is interested in getting any cozier at this point.

Why is Suzuki ready to move on from Volkswagen? The automaker reportedly wants to get its hands dirty on some of VW's North American assembly facilities, but that hasn't happened yet. On the flip side, Volkswagen wants a piece of the Indian car market. Suzuki has strong roots planted in that market thanks to its partnership with Maruti. Both sides have clearly been expecting more out of this relationship, yet neither is happy. Suzuki has a lot more to lose, however, so expect to see it make a move sooner rather than later.
Source here - Suzuki fed up with Volkswagen, may partner with Fiat instead
gshanky is offline   Reply With Quote
Old 18th August 2011, 03:43   #2
Senior - BHPian
 
rajeev k's Avatar
 
Join Date: Jul 2009
Location: Emerging Metro
Posts: 3,306
Thanked: 1,730 Times
Default Re: SCOOP - Is Suzuki looking for a partnership with FIAT?

Post deleted by the Team-BHP Support : Please do NOT post one-liners that add little or no informational value to the thread. We need your co-operation to maintain the overall quality of this forum.

Please read our rules before proceeding any further.

Last edited by GTO : 18th August 2011 at 15:05.
rajeev k is offline   Reply With Quote Received Infraction
Old 18th August 2011, 04:16   #3
Senior - BHPian
 
Join Date: Dec 2007
Location: Bangalore
Posts: 1,062
Thanked: 291 Times
Default Re: SCOOP - Is Suzuki looking for a partnership with FIAT?

But isn't it the same thing as the JV with Tata? A prospective Grande Punto customer walks into a Maruti-Fiat dealership and the sales rep says "saar, buy the Swift. It is a Maruti and sells X times more than the Punto, its resale is Y times better, it is faster and its FE is more etc etc". Its not much difficult in India to convince a prospective Punto buyer to buy a Swift. Hardcore Fiat fans will buy it anyways, whether or not its a JV with Suzuki.
blue_pulsar is offline   (1) Thanks Reply With Quote
Old 18th August 2011, 04:45   #4
MAS
Senior - BHPian
 
MAS's Avatar
 
Join Date: Oct 2007
Location: Chennai
Posts: 1,834
Thanked: 1,205 Times
Default Re: SCOOP - Is Suzuki looking for a partnership with FIAT?

+1

There will not be much of a difference unless Fiat pushes for exclusive sales personnel in these showrooms. The service levels will definitely improve and so will customer confidence. I love the Fiat Linea and in spite of looking to buy a sedan under 12 Lakhs, I'm not even considering it due to TATA a.s.s.

@ FIAT: please wake up from your slumber and just by changing a few things you can be successful in India. The question remains… who will bell the cat?
MAS is offline   Reply With Quote
Old 18th August 2011, 07:04   #5
Senior - BHPian
 
Join Date: Nov 2009
Location: Bhubaneswar
Posts: 1,762
Thanked: 532 Times
Default Re: SCOOP - Is Suzuki looking for a partnership with FIAT?

I really dont see this happening. Its just speculation in my view. Suzuki like mentioned in the article has been working with FIAT before as well. If they had to they would have joined the partnership before.

Though FIAT's ownership of Chrysler, now makes the deal better for Suzuki.

Whatever the case, I doubt that the Tata-FIAT JV will break in anyway. The Tata-partnership is too strong to be broken this easily.
julupani is offline   Reply With Quote
Old 18th August 2011, 07:35   #6
BANNED
 
Join Date: Apr 2007
Location: Bokaro Steel
Posts: 245
Thanked: 36 Times
Default Re: SCOOP - Is Suzuki looking for a partnership with FIAT?

I believe that the tie up might be more technical in nature than being model marketing, it may involve engines and platform sharing
drsnt is offline   Reply With Quote
Old 18th August 2011, 07:47   #7
Senior - BHPian
 
Rahulk76's Avatar
 
Join Date: Sep 2005
Location: PNQ
Posts: 1,133
Thanked: 204 Times
Default Re: SCOOP - Is Suzuki looking for a partnership with FIAT?

Source Italian carmaker Fiat may make diesel engines for Maruti Suzuki's Swift, Ritz, DZiRE and SX4 - The Economic Times

It's already mentioned in today's economic times

Quote:
Italian carmaker Fiat will make diesel engines for Maruti Suzuki's popular line-up of cars at its Ranjangaon plant. With 85% of Swift, Ritz, DZiRE and SX4 sold run on diesel, Maruti is now looking to source diesel engines from outside after its captive capacity has failed to meet rising domestic demand.
Rahulk76 is offline   Reply With Quote
Old 18th August 2011, 09:22   #8
Senior - BHPian
 
Join Date: Nov 2009
Location: Bhubaneswar
Posts: 1,762
Thanked: 532 Times
Default Re: SCOOP - Is Suzuki looking for a partnership with FIAT?

We had been hearing about this for a couple of months now. Overall good news for the profits and revenues for FIPL, and thus for both Fiat SPA and Tata Motors. It will help keep the factory better utilised even during slump months.

But this cannot really be taken from the point of view of FIAT moving from Tata to Suzuki. Remember FIAT India is a 50-50JV between Fiat SPA Italy and Tata Motors. So Tata Motors would have agreed to this sale of engines, happily as it will help cut the losses they are making via FIPL.
julupani is offline   Reply With Quote
Old 18th August 2011, 12:19   #9
Senior - BHPian
 
HammerHead's Avatar
 
Join Date: Oct 2009
Location: Goan in Pune
Posts: 1,093
Thanked: 210 Times
Default Re: SCOOP - Is Suzuki looking for a partnership with FIAT?

To me it looks like Maruti is already on full throttle manufacturing their version of MJD and due to heavy demand for diesel engines they might look at Fiat to make X nos. of diesel engines for them. Apart from this nothing else in their mind!!
HammerHead is offline   Reply With Quote
Old 18th August 2011, 13:11   #10
BHPian
 
vinay_ss's Avatar
 
Join Date: Jan 2006
Location: BANGALORE
Posts: 123
Thanked: 64 Times
Default Re: SCOOP - Is Suzuki looking for a partnership with FIAT?

There is a school of thought that the Tata Fiat JV is more inclined to sell powertrains, rather than the Fiat Cars. This news that MUL is planning to source Multijet diesel engines from the JV only furthers this view.

To my mind, its one thing to use your idle capacity to sell engines and keep the plant running. If i recollect correctly, the JV has a installed capacity to manufacture 2 lac powertrains per annum - which is huge, considering the current number of cars that the company sells. However, this also shows the inherent underlying threat that Fiat faces in India - known for its engines, rather than cars - no matter what they do, which cars they introduce, how many models they introduce or how better their service levels get - all because the Brand is known for engines, rather than cars.

cheers
Vinay
vinay_ss is offline   Reply With Quote
Old 18th August 2011, 13:13   #11
Senior - BHPian
 
Join Date: Nov 2009
Location: Bhubaneswar
Posts: 1,762
Thanked: 532 Times
Default Re: SCOOP - Is Suzuki looking for a partnership with FIAT?

According to the article, this will still be the Suzuki version of the MJD only, but made in the FIPL facility. But as the basic engine is the same it can be made at Ranjangaon, only the Suzuki specific components will be added in a small "dressing line" in the Maruti factories, before it goes into the Maruti cars.

But as the engine manufacturing facilities changes, they will have to re-certify these cars in India before the FIPL built engines can be used.

Its just a business deal between FIPL and MSIL, to utilise FIPL's under-utilised facilities to make engines to be used in MSIL cars.
Of course, a major business area for FIPL is transmissions and engines, but most of it was for consumption of the two JV partners themselves, ie TML and Fiat.

Last edited by julupani : 18th August 2011 at 13:17.
julupani is offline   Reply With Quote
Old 18th August 2011, 17:11   #12
GTO
Team-BHP Support
 
GTO's Avatar
 
Join Date: Feb 2004
Location: Bombay
Posts: 47,735
Thanked: 89,308 Times
Default Re: SCOOP - Is Suzuki looking for a partnership with FIAT?

Considering that Maruti is a 100 times bigger in India, the power of negotiation is in their court. Thus, we have to think : What would Maruti gain from such a partnership? Heck, they're getting the engines already!

Small car development synergies? I find that hard to believe as well. Maruti (and Japanese cars) are light & cheap, unlike Fiat (and European cars) that are typically heavier & more expensive. Plus, platform sharing can be accomplished even without a partnership on the lines of joint ownership.

In the longer term, I firmly believe that Maruti will develop its own diesel engines (unless they use an in-house partner's engines...like VW). It's unfathomable that a manufacturer selling 20,000+ diesel engine cars a month (and 80,000+ overall) has "outsourced diesels" in it's long-term strategy.
GTO is offline   Reply With Quote
Old 18th August 2011, 17:22   #13
BHPian
 
Join Date: Oct 2009
Location: Chennai
Posts: 58
Thanked: 24 Times
Default Re: SCOOP - Is Suzuki looking for a partnership with FIAT?

Quote:
Originally Posted by GTO View Post

In the longer term, I firmly believe that Maruti will develop its own diesel engines (unless they use an in-house partner's engines...like VW). It's unfathomable that a manufacturer selling 20,000+ diesel engine cars a month (and 80,000+ overall) has "outsourced diesels" in it's long-term strategy.
Maybe because Maruti is waiting for some clarity on the Govt's policy towards diesel pricing? Right now the sales mix might be skewed towards diesel cars due to the fuel pricing, IF and when the Govt acts this might change isn't it?.
partha379 is offline   Reply With Quote
Old 18th August 2011, 22:18   #14
Senior - BHPian
 
Join Date: Jun 2009
Location: Kottayam
Posts: 1,081
Thanked: 153 Times
Default Re: SCOOP - Is Suzuki looking for a partnership with FIAT?

Quote:
Originally Posted by GTO View Post
Small car development synergies?.
For the Indian market it could be Engine. But consider Suzukis US strategy. They are not able to sell their small cars in US, do not have a plant in US. [The news paper report mentions Suzuki wanted to assemble cars in the new VW plant in US]. Now Chrysler under Fiat, do need small cars, that too quickly, which Suzuki got. Chrysler got idle plants that can be shared with Suzuki. Fiat also started independent dealerships that just sells one car 500 (in addition to the existing Chrysler dealerships, which do not sell Fiat), how long Fiat can survive with just one model? . Suzuki needs money. They have small cars certified for US. So association with Fiat will be a win win for both Suzuki and Fiat in US and Japan. Fiat could eventually buyout VWs investment in Suzuki, if VW willing (which i doubt).
teamveevee is offline   Reply With Quote
Old 18th August 2011, 22:49   #15
BHPian
 
vipul_singh's Avatar
 
Join Date: Sep 2005
Location: BLR / Lucknow
Posts: 406
Thanked: 230 Times
Default Re: SCOOP - Is Suzuki looking for a partnership with FIAT?

I have been following FIAT's fortunes in the US for sometime now. I do not believe FIAT would badge engineer Suzukis in that market. They seem quite internally focused for now and have a long list of things to do (integration between Chrysler / Dodge and FIAT model line ups, for instance). Besides, they would not like to do anything which reduces FIAT's brand value in the US (something they are trying to build bit-by-bit)

While I am happy about the possibility of the new sourcing deal, I feel it is time for FIAT to come up with new engine families, ideally to introduce in their own cars, or if not, to sell as a supplier. Else, the advantage of the MultiJet and its status as India's 'National Engine' could get eroded as competitors come up with with equally capable or better offerings (think VW and Ford).
vipul_singh is offline   Reply With Quote
Reply


Thread Tools Search this Thread
Search this Thread:

Advanced Search


Similar Threads
Thread Thread Starter Forum Replies Last Post
Suzuki & Toyota considering a partnership? EDIT: Confirmed volkman10 The Indian Car Scene 57 13th December 2017 16:00
Malaysia: Proton & Suzuki partnership volkman10 The International Automotive Scene 10 18th November 2016 11:28
Fiat and Uber in talks over driverless car partnership dZired The International Automotive Scene 3 10th June 2016 11:17
Fiat & Chrysler in partnership talks! EDIT: Fiat completes Chrysler buyout madan80 The International Automotive Scene 61 30th January 2014 15:43


All times are GMT +5.5. The time now is 02:55.

Copyright ©2000 - 2017, Team-BHP.com
Proudly powered by E2E Networks