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Old 28th February 2012, 20:48   #1
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Default Why Fiat Has Failed In The Past, Present & Will Continue To Fail In The Future

Ask anybody why Fiat has done so poorly in the past and continues to be invisible in India, and you'll probably hear one or all of the following reasons -

- Wrong choice of local partners
- Poor reliability
- Poor after sales service
- Poor mileage
- Not so powerful heavy cars
- Poor brand image

and so on.

Of course, these might have contributed to the situation to a large extent. But to find the real reason why they are in this mess, you need to look at their recent history in India.

Year 1997 - Launch of Fiat Uno
Year 2000 - Death of Fiat Uno

Year 2000 - Launch of Fiat Siena
Year 2001/02 - Death Of Fiat Siena

Year 2001 - Launch Of Fiat Palio/Petra/Adventure
Year 2010 - Death Of Fiat Palio

Year 2009 - Launch Of Fiat Punto/Linea
Year 2014 - Death Of Fiat Punto/Linea

What can one deduce here? Fiat, in 15 years, has launched a grand total of 4 models in the past 15 years. All these years, if you go to a Fiat showroom, you don't get to choose a car. Fiat basically launches a model (and its booted variant) and waits for it to die a slow painful death. And then they launch another one after 5 years. In my opinion, this is the biggest cause for Fiat's failure as a manufacturer in India.

Fiat now rakes in decent amount of profits every year thanks to the success of Punto & Panda in Europe. It's not like they don't have the money to invest in emerging markets. You will NOT see the following models launched in India, eventhough they make perfect sense -

Fiat Panda:

Why Fiat Has Failed In The Past, Present & Will Continue To Fail In The Future-fiat_panda_100hp.jpg


Fiat Bravo - in a booted form, to take on Civic/Laura/Corolla/Jetta


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Fiat Croma - to take on Accord/Superb/Passat. Michael Schumacher's daily drive is Fiat Croma, by the way.

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Fiat Doblo - to compete with Xylo or the Innova

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Fiat Multipla - 6 seater MPV

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Fiat Idea - Niche mini-MPV car

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Fiat Sedici - SX4 without boot but with 4WD!

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And we are not even talking about Alfa Romeo.

If an ex-Maruti or ex-Hyundai senior executive becomes the CEO of Fiat India, only then you can expect improvement in the performance of Fiat as a manufacturer. These guys know the market well, and know that one of the keys to success is to give lots of choice to the customer. When a customer walks in to a Fiat showroom, the chances of making a sale are higher if you have 10 models, instead of 1 - it is as simple as that.
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Old 28th February 2012, 21:00   #2
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Default Re: Why Fiat Has Failed In The Past, Present & Will Continue To Fail In The Future

Except for the fiat bravo, I am happy that they didnot launch the other models in India, such ugly looking cars. You dont want to end up with a fiat with all its inherent problems + which is ugly looking as well. Atleast the current crop of fiat cars in India are pleasing to the eye
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Old 28th February 2012, 21:18   #3
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Default Re: Why Fiat Has Failed In The Past, Present & Will Continue To Fail In The Future

Quote:
Originally Posted by smartcat View Post
Year 2014 - Death Of Fiat Punto/Linea
Just curious how you arrived at this year. Did you do any calculations?
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Old 28th February 2012, 21:20   #4
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Default Re: Why Fiat Has Failed In The Past, Present & Will Continue To Fail In The Future

Some of your points are correct. However, for FIAT currently has chicken and egg story to overcome.

They have to get their act together in opening independent dealerships (which is slowing happening) and independent service centers and maintain proper inventory levels of parts.

But for people to invest in a new dealership, with just 2 models which are not fast moving it would be very difficult investment decision for most.

FIAT should at least get the FIAT Panda which somehow makes me feels that it can rake in numbers of 2K per month. With a combines sales of 3.5k-4K, the equation looks a bit more lucrative for the investor (read as dealership owners).

All the forum members/the car buying public can do is wait to see how things turn out for FIAT.

Last edited by nkrishnap : 28th February 2012 at 21:27.
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Old 28th February 2012, 21:42   #5
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Default Re: Why Fiat Has Failed In The Past, Present & Will Continue To Fail In The Future

Quote:
Originally Posted by kodivasanth View Post
Just curious how you arrived at this year. Did you do any calculations?
Because, history repeats itself! I guess its a tongue-in-cheek remark by the TC to drive the point that Fiat has neither been able to nurture and sustain their existing cars nor been able to launch newer models consistently.

Quote:
Originally Posted by smartcat View Post
Ask anybody why Fiat has done so poorly in the past and continues to be invisible in India, and you'll probably hear one or all of the following reasons -

- Wrong choice of local partners
- Poor reliability
- Poor after sales service
- Poor mileage
- Not so powerful heavy cars
- Poor brand image

and so on.
Why do we worry so much about Fiat's failure and not about Premier or hindustan motors? Simply because Fiat still makes great cars that look great and are built like a tank (teething issues like falling plastics aside, of course!).

But to me, it looks like they are simply not serious about the indian market. While the indian arm seems to be making some effort, I am not sure if the parent company is really interested in India as a market. Going by the thread starter's well articulated point of view, you can't be launching 4 models in 13 years with not more than 2 cars to choose from at any point in time, and still hope to win.

Fiat needs a complete re-think. It needs to re-think everything - product launches, marketing, operations, Dealerships/supply chain. Except manufacturing, every other function within Fiat India has failed.

Last edited by veyron_head : 28th February 2012 at 21:50.
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Old 28th February 2012, 22:04   #6
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Default Re: Why Fiat Has Failed In The Past, Present & Will Continue To Fail In The Future

Sales and Service is the back bone for any car manufacturer.
There should be enough(atleast adequate) touch points for a customer to service his car. Service in the sense not just bring in and put in with some garage. It should be a dedicated one for the Fiat brand and should no in and out of a Fiat car.

Independent sales and service outlets is highly required for Fiat to start its innings. Let Tata be its 50% investment partner but it should avoid it in sales/service front.

As a brand, Fiat has better loyalists and familiarity than newly launched Brands and products. But without developing service, Fiat can earn nothing.
Here I mean service as a proper service station with adequate parts storage and support and most importantly the spare parts price should be rightly priced and should not be a makeover for its lost sales.

As told here,until there are some visibility for brand, we maynot see a good financially healthy investor to come with dealership.Until then as a part of investment for brand let fiat open its own brand outlets in Metros. Why should a company spend only for product development let it spend a equal amount for developing a proper network to bring the confidence in brand Fiat. When there is enough demand Fiat products and when the dealer outlet is financially manageable, it can transfer its network slowly to third party dealerships.

Without doing such things if Fiat brings all the above listed models in one shot and price it between 5lks to 10lks, there will not be much improvement.
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Old 28th February 2012, 22:05   #7
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Default Re: Why Fiat Has Failed In The Past, Present & Will Continue To Fail In The Future

Save for the Punto and Linea, all the rest of the cars in your original list have been mostly abominations on wheels. Specially when compared to their immediate competitors of that time. Naturally market had given them thumbs down.

Many people say even the first gen Santro was an abomination, but then it was a great car to own and drive. Same cannot be said about Fiats models from late 90s till Palio.

I know many people are passionate about the 1.6 petrol and 1.9D Palio. But just look at drive comfort and the interiors of these cars. I have driven them enough to know what to avoid.

I feel that it is not just poor marketing and execution, but also the quality of cars. Punto and Linea has been a major improvement but then the execution is downer. Unless the company rolls up its sleeves and does something remarkable, it will be best known for its amazing 1.3 diesel engine.
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Old 28th February 2012, 22:30   #8
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Default Re: Why Fiat Has Failed In The Past, Present & Will Continue To Fail In The Future

Wasnt Rajeev Kapoor (their recent CEO) ex-Hero honda? What better caliber leadership do you need to turn it around, btw?

Last edited by GTO : 29th February 2012 at 14:12. Reason: No SMS language please. u = you. Thanks
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Old 28th February 2012, 22:51   #9
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Default Re: Why Fiat Has Failed In The Past, Present & Will Continue To Fail In The Future

Quote:
Originally Posted by smartcat View Post

- Poor mileage
- Not so powerful heavy cars

Year 2009 - Launch Of Fiat Punto/Linea
Year 2014 - Death Of Fiat Punto/Linea
I totally disagree with 2 points mentioned by you on the mileage and power front.

I pray that your prediction come true regarding the death of Punto/Linea . Let us get Evo/Croma/Freemont and so on. Every time when a car is discontinued from Fiat, it has always presented the market with a much more modern car.

We have all discussed about the A.S.S, Reliability, Brand image, etc, etc, to death. Again, what is the purpose of this thread?

Note:- Most of the pictures you have shown are not the current versions of the respective models.

Last edited by rameshnanda : 28th February 2012 at 22:55.
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Old 28th February 2012, 23:30   #10
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Default Re: Why Fiat Has Failed In The Past, Present & Will Continue To Fail In The Future

After getting the management control of Chrysler/Dodge, Fiats focus now is on Chrysler/Dodge. They are in the process of revamping the Chrysler/Dodge cars, especially the small cars with Fiat platforms and technologies. A lot depends on the upcoming Dodge Dart that is based on Fiat platform. Unlike Toyota and VW, Fiat is not after the numbers right now, but to make it operations, especially the US operations profitable. So a no-profit, no-loss operation in India is good enough for Fiat. Their current roadmap for the recovery of Chysler/Dodge is 5 years and they may turn to India after that. For now, we cannot expect any major investment from Fiat in India.
Even Tata is losing money on the joint venture, irrespective of what the TBHPians think, Financially, Tata as a company might have been better of if they have not invested in Fiat. They could have easily sourced the same technologies at much lesser initial investment from other vendors. So TM do not want to pour any more money in to Fiat India, right now. With out any capital infusion from any of the partners in the near future, we cannot expect any new models. In the near term all they try to do is reduce the loss, by improving service, facelifts, selling engines etc. Nothing drastic..
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Old 28th February 2012, 23:46   #11
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Default Re: Why Fiat Has Failed In The Past, Present & Will Continue To Fail In The Future

Quote:
Originally Posted by teamveevee View Post
After getting the management control of Chrysler/Dodge, Fiats focus now is on Chrysler/Dodge. They are in the process of revamping the Chrysler/Dodge cars, especially the small cars with Fiat platforms and technologies. A lot depends on the upcoming Dodge Dart that is based on Fiat platform. Unlike Toyota and VW, Fiat is not after the numbers right now, but to make it operations, especially the US operations profitable.
Is there Fiat in the USA? I don't recall ever seeing a Fiat car there? Have they recently started operations there?
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Old 29th February 2012, 00:14   #12
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Quote:
Originally Posted by carboy

Is there Fiat in the USA? I don't recall ever seeing a Fiat car there? Have they recently started operations there?
Fiat re-entered the USA market last year. They had withdrawn from the USA market in 1984, IIRC.

They sell Fiat 500 in US currently.

Last edited by Klub Class : 29th February 2012 at 00:16.
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Old 29th February 2012, 00:32   #13
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Default Re: Why Fiat Has Failed In The Past, Present & Will Continue To Fail In The Future

I really believe that its not the Fiat India at fault. Had that been the case Fiat would not even survive with so few models for such a long time in India.

Its totally dependent on the Parent company. If there isn't any serious interest shown by Parent what the Indian arm can do at best.

Just look at how Fiat is giving out the National Engine of India the 1.3 MJD to Maruti, Tata etc. and now Premier too. Is this even thinkable without a genuine interest from the Parent company? Hence I feel the same theory applies had the Parent company shown genuine interest and action towards launching India specific cars from their stable, Fiat would be atleast what Ford, Cheverolet is today in India.
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Old 29th February 2012, 00:34   #14
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Default Re: Why Fiat Has Failed In The Past, Present & Will Continue To Fail In The Future

One of the fav topic on team bhp. Why FIAT failed.

They really had early entry to India advantage on their side but look how horribly screwed up the world class cars like Palio. Really sad to recall that such a nice car, offered with so much option and color combinations decade back is now a thing of past. Some times i seriously dont understand what is really wrong with these auto majors. Look at Hyundai how they came and wisely captured market and now enjoying premium by over pricing the cars. While FIAT were busy doing dont know what! Even look at Ford. Small car started with VFM value for Figo and now silently have increased prices. I seriously dont understand why Fiat cant do that. Worst of all is tie up with Tata where service exec says "Sir why Fiat sir. We have manza for same price"

I was in market to buy a car last week. My heart, mind every thing said Fiat Punto but precisely for same reasons mentioned here i gave FIAT a miss. I would rather live wit changed mind and broken heart than broken car waiting for weeks for part arrival so went and booked figo. its not just my story i know lots and lots of people who do similar thing of giving FIAT a miss due to "Service problem"

Quote:
Originally Posted by smartcat View Post
If an ex-Maruti or ex-Hyundai senior executive becomes the CEO of Fiat India, only then you can expect improvement in the performance of Fiat as a manufacturer. These guys know the market well, and know that one of the keys to success is to give lots of choice to the customer. When a customer walks in to a Fiat showroom, the chances of making a sale are higher if you have 10 models, instead of 1 - it is as simple as that.


Now forget about ex-Maruti or ex-Hyundai senior executive becoming a CEO of FIAT india, i bet, any one of us passionate BHP-ians becomes the CEO of FIAT, the sales will definitely improve. Simple things which can surely improve FIAT image in India.

1. make nice interiors and than cheap looking plastics and lose parcel try etc.
2.make parts available immediately to gain customer confidence
3. to start with, price a car little cheaper till you see decent sales happening across dealership. Since FIAT is auto major in the world I am sure they can absorb the initial costs and possible low revenues/profits by making cars cheaper.
4. Set up own showroom ASAP.

and like smart cat said, give some options to customer by introducing more variants of cars, MPV etc

PS: congrats smartcat on completing 1000 posts on team bhp.

Last edited by recshenoy : 29th February 2012 at 00:37.
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Old 29th February 2012, 00:36   #15
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Default Re: Why Fiat Has Failed In The Past, Present & Will Continue To Fail In The Future

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Originally Posted by phamilyman View Post
Wasnt Rajeev Kapoor (their recent CEO) ex-Hero honda? What better caliber leadership do u need to turn it around, btw?
This is one point which I strongly disagree.

Please tell me how many really good competitors were there when Hero Honda introduced their 4 stroke engines. I believe only Kawasaki Bajaj. Hero Honda scored on reliability aspect that helped that brand to grow. If he was a good CEO he might have forseen the entry of Honda directly to Indian market and equipped Hero Honda with their own R & D and they are still struggling to get a good technological partner.

As per my opinion, this one also needs to be added to the list - FIAT needs a good visionary CEO too.
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