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Old 26th July 2010, 06:56   #76
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Can someone explain the intricacy of a 50:50 joint venture. For a layman it sounds like an equal share, which means they both share equal profit and loss for every vehicle produced.
In that case, punto, manza, vista, linea are all from the same stable and hence the logic of having a common sales point. Then why is it that many of you suggest that the fiat sells engines to Tata? My impression was that all vehicles from the joint venture are jointly produced and sold. Its the complete vehicle profit that both will share. Did I miss anything?
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Old 26th July 2010, 10:01   #77
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Originally Posted by chittybang View Post
Can someone explain the intricacy of a 50:50 joint venture. For a layman it sounds like an equal share, which means they both share equal profit and loss for every vehicle produced.
In that case, punto, manza, vista, linea are all from the same stable and hence the logic of having a common sales point. Then why is it that many of you suggest that the fiat sells engines to Tata? My impression was that all vehicles from the joint venture are jointly produced and sold. Its the complete vehicle profit that both will share. Did I miss anything?
FIAT INDIA is a 50-50 joint venture. The Ranjangaon plant belongs to the joint venture but the land itself seems to belong to FIAT alone. The facility is managed jointly by TATA and FIAT

The current capacity is to produce 1 Lakh cars ad 2 Lakh engines every year. But the capacity could be increased to double the volumes in the future based on needs. The agreement is to produce Paloi, Grande Punto, Linea, Indica vista, Indigo Manza and probably future cars that share the FIAT multijet and fire engines. To manufacture new cars I assume a new agreement needs to be signed. This makes sense since the next FIAT model is not expected until 2012 and by which time a new agreement could be signed.

In the meantime TATA and FIAT could form another joint venture to sell NANO in latin america. Seems like this partnership is here to stay.
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Old 26th July 2010, 10:28   #78
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Originally Posted by gshanky View Post
FIAT INDIA is a 50-50 joint venture. The Ranjangaon plant belongs to the joint venture but the land itself seems to belong to FIAT alone. The facility is managed jointly by TATA and FIAT
I have a little doubt here. Does the 50:50 JV mean whatever vehicle is manufactured out of Ranjangaon plant, Tata & Fiat shares equal profit? Does that mean even if Fiat doesnt sell any car, it will still get 50% of what Tata earns?
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Old 26th July 2010, 14:49   #79
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I have a little doubt here. Does the 50:50 JV mean whatever vehicle is manufactured out of Ranjangaon plant, Tata & Fiat shares equal profit? Does that mean even if Fiat doesnt sell any car, it will still get 50% of what Tata earns?
I think it could be the case but atleast some % will go for Tata or Fiat on the specific models being sold solely because of design royalties. So a More Manza sales over Linea would mean a little bit more % to Tata, but not the entire profit.
The JV is to manufacture only specific Tata models and Fiat models, so Tata can still make money selling say Nano or Safari from other Factories and treat it separately in their books.
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Old 26th July 2010, 18:58   #80
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I was recently in a Tata-Fiat showroom, and I disagree that Tata is taking sales away from Fiat. Someone who wants to buy a Linea or a GP has clear reasons for picking it. Sure, they might decide to look at a Manza/Vista instead if their finances do not permit a Linea/GP, but then they could just as easily have gone to some other brand. I never felt that the dealership was steering a prospective Fiat customer towards a Tata. IMO, a Fiat customer has a wholly different set of priorities than a Tata customer.

I think that on the whole, the setup is beneficial. There is a chance of a Tata-buyer deciding to break the bank an go for the Fiat, and a chance of a Fiat customer deciding to downgrade his dream to a more affordable Tata. Either way, the buyer will look at either Tata or Fiat, keeping it within the family, before considering something else. In the long term, that works out better for both companies, especially with component sharing. I'm assuming that Fiat gets paid something for Tata using it's drivetrains.
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Old 26th July 2010, 21:47   #81
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People still have doubts over the Fiat's commitment to Indian market. Many people, even as they prefer Linea/Punto, buy some other brand and model as they are still apprehensive of the longevity of Tata - Fiat JV.
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Old 27th July 2010, 12:45   #82
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I am not an expert but I visited fortune cars Nerul to test drive a 1.2 Punto. I was treated well by a Fiat sales guy by the name of Anoop Shinde. He was well informed and showed me around the service centre as well. I wanted to try the 1.4 as well and so returned another day. This time another Fiat sales guy by the name of Amit handled the process and he too was pretty good. There was no attempt by any Tata sales guys trying to woo me away. Infact they had clearly seperate counters and both were adequately staffed. I havent heard a lot off good about Fortune cars within the forum but from my experience so far it seemed pretty acceptable. I was attended within a minute and they were very keen to get feedback from my test drive. May be things go bad after the sales but for someone going to make a purchase they did a good job selling the car.
May be things have improved. We at team bhp accept that A** has been Fiat's major issue but if there is an improvement it has to be acknowledged. I do not know how things were back in the days of the Palio. Can someone make an inference from my experience?
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Old 28th July 2010, 06:59   #83
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The sales executive at Concorde Motors, Dairy Circle, Bangalore, had informed me at the time of my buying Fiat Linea that he was dealing with Fiat Linea only and there were separate personnel for other models. He was a well-informed gentleman. I gave an excellent rating for him during feed-back surveys.
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Old 28th July 2010, 07:21   #84
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Originally Posted by chittybang View Post
There was no attempt by any Tata sales guys trying to woo me away. Infact they had clearly seperate counters and both were adequately staffed.
I, too, read about TATA-FIAT dealers being more interested in selling TATA cars in many threads. My experience was exactly the opposite. While checking out Fiat Linea and Punto, I showed Manza(though I wasn't interested in it) to my father as TATA and FIAT cars were on display together. The sales executive was not interested in TATA cars at all. He started to question the long term issues with non FIAT cars(rattling issues etc).

So, I guess this "step mother treatment to FIAT" might with be with a few dealers but overall FIAT has improved a lot.

TATA does not carry the responsibility of pushing FIAT sales. They have provided FIAT with established dealerships and service centres. FIAT shall aggressively come forward with consistent after sales service with more dedicated staff and adequate stocks of spares.
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Old 31st July 2010, 08:14   #85
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Originally Posted by chittybang View Post
I am not an expert but I visited fortune cars Nerul to test drive a 1.2 Punto. I was treated well by a Fiat sales guy by the name of Anoop Shinde. He was well informed and showed me around the service centre as well. I wanted to try the 1.4 as well and so returned another day. This time another Fiat sales guy by the name of Amit handled the process and he too was pretty good.
+1 to this. I test drove twice @ Fortune Cars and must say, the experience was great, well informed sales person, good finance folks etc (after a horrendous experience at Wasan). I finally it brought it from Concorde due to proximity from home but again, Fortune cars gave me a decent sales experience.
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Old 31st July 2010, 23:38   #86
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Goodwill and trust is something that will take years to build. Fiat was lacking on that and logically no matter how bad the Tata service may be we in India have a lot of trust in Tata and hence the tie up makes sense. Agreed that Fiat still has a long way to go and are not helping their cause with poor interiors, fit and finish but there is an improvement in the perception. I till a year ago wouldnt have considered a Fiat but the Linea/Punto launch changed everything for me. I am certain there are many others like me who are willing to reconsider a brand we once loved. It is unreasonable to expect a massive sales output. Lets wait and watch before we make a verdict.
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Old 31st July 2010, 23:44   #87
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Originally Posted by chittybang View Post
Goodwill and trust is something that will take years to build. Fiat was lacking on that and logically no matter how bad the Tata service may be we in India have a lot of trust in Tata and hence the tie up makes sense. Agreed that Fiat still has a long way to go and are not helping their cause with poor interiors, fit and finish but there is an improvement in the perception. I till a year ago wouldnt have considered a Fiat but the Linea/Punto launch changed everything for me. I am certain there are many others like me who are willing to reconsider a brand we once loved. It is unreasonable to expect a massive sales output. Lets wait and watch before we make a verdict.
Very well said in not so many words. Appreciate it.
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Old 31st July 2010, 23:48   #88
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I too was surprised to see a good reception by Tata dealers when I visited a dealer for booking a Palio. I am really proud to own a Fiat car. If all goes well, Fiats will be the car for all my life!
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Old 4th August 2010, 01:26   #89
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Further bad news for FIAPL the Tata-Fiat 50:50 JV. The company has posted a net loss of 970 Crore for the last fiscal which is up by 40% from the previous year. Tata Motors is cutting back its lending to the subsidiary which cannot even utilize 15% of its current installed capacity of 16500 cars a month. In fact now the spare capacity is being lent to the Tata Manza and Vista

High input costs and lower than expected Fiat sales are the key reasons for such high losses for the JV. Infact, while fiats sales have largely stabilized at 2500 units each month - the buzz is that in the past few months, the numbers have remained stable only thanks to large discounts.
Even so there has been a dip of 14% in the last 2 months. The company has als discontinued the Palio model recently.

No idea where Fiat goes from here. The only serious move to counter the situation is that, Fiat India is developing a small car that would be priced below the Punto

Article for your interest:
Tata-Fiat JV faces mounting losses

Last edited by acidkill : 4th August 2010 at 01:36.
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Old 4th August 2010, 01:47   #90
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This has been, as pointed out earlier, discussed before.
IMHO, fundamental reasons for low sales:

Fiat's reputation of poor A.S.S.
+
Linea: Performance, lack of anything special (other than dynamics which most people don't care about, and looks).
+Punto: Where do I even start? Slower than competition. Priced like a premium hatch, but quality of plastic, finish etc leaves much to desire.

They got things wrong right from the beginning;
(1) I strongly believe that Blue&Me should have been a standard on ALL models.
(2) What was the point of downtuning the engine in Punto?
(3) The Linea, simply put, needed a better engine.
(4) The Punto needed better plastic. It was supposed to be a premium product.
(5) Reduce that darn turning radius. I have had so many people tell me "abe punto/linea try kiya tha. mazaa nahi aaya. steering kharab hai, gaadi u-turn hi nahi leti".

Sadly, once a product fails.. you can do little to redeem yourself. Launch a new car Fiat! Go big. Get one in the Palio segment. Get an absolute winner. Go for revenues, not margins.
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