[Steeroid]

Okay we have the result of ONE rumour today - the talk about Hindujas getting involved in Fiat...

Apparantly the talks between the two that we discussed to death was about Fiat PULLING OUT of Leyland International and Ashok Leyland, not of the Hindujas coming INTO Fiat.

Read on:

http://www.business-standard.com/com...&autono=201459

[cnu]

Originally Posted by sandeepmdas

Perhaps Fiat's top bosses are not interested in India-based TV channels. Perhaps they will be watching only RAI. Or perhaps MTV and FTV are their fav TV channels.

Or perhaps it was the weekend.

Or perhaps they are busy packing their bags and want to open their mouths to say the final bye....

[GTO]

Is Fiat shutting down the Kurla plant for sure ?

The production out there is a small fraction of its capacity. For sure, Fiat does not and will not need it. Period. At the same time, they CANNOT keep it running the way that it is because the plant is doing nothing but burning hard cash for them.

Whos going to buy it? Or go the HM way and use excess capacity to feed other manufacturers' wants.

How exactly are the Tatas fitting into the equation with respect to FIAT's Indian operations ?

I dont see any win-win side to this situation. Fiat probably has a lot to gain. But I cant single out one key advantage for Tata except for the fact that they can get whatever they want at a throw-away price (literally)

Will the Tatas just be sourcing the palio petrol engines or will they be building the cars also ?

I do hope that Tata does NOT build any Palios. The best thing about the Palio is its build quality.

Will the Tatas be only concerned with the petrol based technoligies FIAT has to offer or will they also be dabbling in FIAT's diesel technologies ?

Theres nothing revolutionary about Fiat petrols, so I dont thing Tata would be interested in that. The Fiat diesels - Yes. New generation Fiat diesels are awesome. Buttttttttttttt Tata has already developed its own Common Rail powerplants. And Fiat is supplying fresh technology to Maruti.

Where will the Tatas be building the Palios, if at all ?

I dont see the sense in Tata building Palios. Its the Fiat plant that has excess capacity, while Tata had to delay the Marina launch due to production capacity constraints. Why on earth would you overburden something running at 100%, when you have a sister concern running at 1% capacity?

What are the implications of the above for FIAT's indian customers ?

Thats a HUGE question mark, and I have a very negative feeling about this. Tata and Fiat have just signed an MOU to "analyse" areas where they can work together. That means, its a feasibility study. If Tata does not like what they see, they are free to walk away.

Tata has NOT committed to anything. Its got an incredibly smart management and is merely having a closer look.

GTO

P.S. Its an irony that there is talk about Tata building the Palio. Simply because the Palio and Indica were both penned by the Idea design studio. And it was the Palio that was designed first (the original of two similar designs).

[Steeroid]

They're probably going to hock one of their plants to Tata who need more capacity, by the looks of it. Dont see why Fiat would move production from the Kurla plant to the much bigger Ranjangaon plant when even the Kurla plant is running at a fraction of its capacity.

Perhaps they want to continue in Kurla and sell the Ranjangaon plant? They've been wondering what to do with that new plant for quite some time now.

[Mpower]

IMO the following should happen.

Close down Kurla plant and sell the real estate at market price.
Dosent make sense to have an auto plant in the middle of a big city
High labor costs, militant labor unions and generally high operating costs.
Sell Ranjangaon to TATA who will make Palio and Indica side by side.
TATA will supply parts for Palio thru its TACO subsidary.
Drop TATA's common rail program and use FIATs multijet engines.
Joint development of all new petrol to beat Honda's fuel sipping 1.5

Long term -----> joint development of Indica and Palio.....will be twins sort of like toyota Aygo and Peugeot 107.

In today's M&A frenzy, there is no auto major without some sort of an alliance with another major. Ratan Tata knows this and already tried talking with PSA, Rover and Renault with no success. He has to make it work with FIAT. Time is running out and soon maruti will have a small car diesel that will break TATA's dominance and USP.

[RX135]

Originally Posted by Steeroid

They're probably going to hock one of their plants to Tata who need more capacity, by the looks of it. Dont see why Fiat would move production from the Kurla plant to the much bigger Ranjangaon plant when even the Kurla plant is running at a fraction of its capacity.

1) They have only land and buildings in Ranjangaon. So even if it is bigger space, it is not at all extra cost.
2) They have all vendors operating in Pune and nearby areas, which makes it cheaper for Fiat to procure items quickly and at lesser expenses.
3) There is no Octroi for this plant (don't know how and why, but there is none) which can cut their additional expenses.

[GTO]

In reply to some suggestions : Costing is not the real problem with Fiat India. For sure, it would help in cutting loses but the real problem is with the management, image and support (Dealer, customer and media).

GTO

[BUSA]

Is the fiat site still up or not or its still in the making! What the f*** is Fiat doing, just changing MDs!

[satish_appasani]

Finally my worst fear became true. Economic time stated today that Fiat is writing it's exit plan.

The current MD Mr. Paulo Castagna who joined the company just 3 months ago has been called back to Italy.

ET indicated that Fiat will sell away it's land in Kurla and the manufacturing operations will be shifted to Tata's Pune plant.

I noticed two contradicting items in the news. First it is said that operations will be moved to Tata's plant. And then in the next paragraph, it is written Mr. Castagna was upset because Fiat India was not part of Fiat - Tata discussions.

So far I was optimistic that Fiat will stay here and will enjoy better market. If the above news is true, who will take care of spares and service?

[satish_appasani]

Let us stop predicting whether Fiat will stay or leave. Let' start predicting what is the fate of existing customers, people like me....

[ajmat]

Fiat make good cars but cannot run its plants efficiently- things get screwed up going downstream hence Fiat will focus on doing what it does best and outsource the rest to someone else, or tap into someone elses economies of scale. Tata can provdie a lot on this front. Good luck to them !

[typeOnegative]

I think the complication here might be because FIL is still with PAL? Is that true? So cooperation with the Tatas in India might require a little manoeuvring, which is why all these speculations are coming up.

Regarding sales and service, Satish, I dont think we should be worried right now. The news is still speculation. But yeah, Fiat is a bit stupid not to have come out in the open strongly.

[RX135]

Originally Posted by typeOnegative

Regarding sales and service, Satish, I dont think we should be worried right now. The news is still speculation. But yeah, Fiat is a bit stupid not to have come out in the open strongly.

Is this in print media today? I could not get anything on the web about this exit plan and recall of MD :(

TypeO, there may be good things hidden in it (such as Tata marketing/supporting Fiat cars) or it can be worst (Fiat users left to their fate), but looks like it has crossed the phase of being speculation. If media-savvy Fiat India MD has not made any speech so far, then it probably means something. Good or bad, only time will tell.

[AvinashKeezh]

do we have any means of getting the real picture here!!!
mods could you help us out here???
the news channels have been doing all sort of mongering with whatever they can lay their hands on!!! so, we can only assume the things that they would say about a company that has FIAT as it's name..
but could we just ask the PR in FIAT (there's gotta be someone there right??)... so we can have the facts!!!

ak

[hasopi]

This is the ToI article:
Castagna quits Fiat India

By Mansi Kapur/TNN
Mumbai: Fiat India's recently appointed managing director, Paolo
Castagna, is headed back home after facilitating the global alliance
between Fiat SpA and Tata Motors. Castagna took over as MD from
Alberto Montanari on June 1, even before the latter's term ended.
Castagna stepped down from the post and will be replaced by
Giovanni De Filippis beginning October 1. Fiat India board in the
mean while has accepted Castagna's resignation.
He, however, continues to remain the managing director of Fiat
India Automobiles, the holding company of the Fiat India. According
to sources, "Although Castagna has stepped down from the post of
Fiat India, he would continue to be the MD of Fiat India Automobiles
so as to ensure the smooth transition of the positions.''