FIAT looks to step up exports to US

[bzcat]

Cliffs:

• FIAT plants in Italy are under 60% utilization
• Sergio is going to use excess capacity in Italy to make FIAT models for US market
• Alfa will be sold at US FIAT dealers, which was always the plan, but Alfa models are delayed (is anyone really surprised?)
• At least 1 more FIAT models will come from under utilized plants in Italy in the meanwhile to make peace with US dealers that plunk down money to sell Alfa
  

I'm guessing the next FIAT model after 500L will be the 500X. Or maybe the 500 sedan.

CEO Marchionne Floats Plan to Utilize Excess Capacity and Give Italian Firm's U.S. Dealers More Models, Brands to Sell

Fiat SpA may produce more vehicles in Italy for export to the U.S., helping the auto maker ease its excess domestic production while aiding Fiat dealers struggling with too few models and the brand's rocky return to the U.S. auto market.

Chief Executive Sergio Marchionne said he may use a factory south of Rome to build an undisclosed car for export to the U.S. Existing Fiat plants are to build Maserati sports cars and a Jeep sport-utility vehicle for U.S. export.

Fiat has five Italian auto plants, and "a lot of these plants are going to be producing for the U.S.," he said.

Mr. Marchionne, who also is CEO of Chrysler Group LLC, declined to identify the model that would be sold in the U.S. The Cassino, Italy, plant that he hopes will become a third U.S.-export facility already assembles the Alfa Romeo Giulietta using a platform adaptable to U.S. requirements, he said.

The proposal suggests Mr. Marchionne is considering a new tack to solve two problems. In the U.S., he would boost volume by giving dealers struggling with their Fiat franchises more models to sell. Currently, the dealers have just three versions of the Fiat 500, a subcompact car. To make matters worse, U.S. demand for the Fiat 500 Abarth sports version has outstripped supply. The U.S. versions of the Fiat 500 are made in Mexico.

In Italy, the move would allow Mr. Marchionne to utilize excess capacity. Most mainstream European car makers are losing money in the region as factories operate well below the between 75% and 85% capacity needed to break even. Fiat is operating below 60% and has already suspended some production and postponed some vehicle launches.

Fiat's return to the U.S. market in late 2010 after a 27-year absence has been a singular disappointment for Mr. Marchionne, who turned Chrysler into a profitable and expanding auto maker. The Fiat 500 has yet to meet its sales targets, and the brand remains well below its goal for U.S. dealerships. Last November, Fiat replaced U.S. brand chief Laura Soave with marketing executive Timothy Kuniskis.

"I'm [angry] about it because I think that what we did is that we launched that car a year or two early," Mr. Marchionne said in an interview with The Wall Street Journal late last year. "We should have launched in 2012 because the dealer network wasn't ready when I launched."

U.S. sales of the Fiat 500 have averaged 3,335 a month this year, or a total of about 16,700 vehicles through the end of May. Mr. Marchionne originally envisioned selling 50,000 Fiat 500s a year. Meanwhile, the Mini Cooper, which he sees as Fiat's biggest competitor, has sold 26,064 vehicles this year through the end of May.

"We are just hanging out here," said a Fiat dealer who asked not to be identified to avoid any backlash from the company. "I have yet to make any money even though I had to sink almost $1 million to build a new showroom," the dealer said. "They keep promising more product but I have yet to see anything. They like to say things are going well but it's really a mess with this brand."

The Fiat 500 tied for last place in an annual quality-ranking survey conducted by auto researcher J.D. Power & Associates. Chrysler officials contend small European cars traditionally score low in the survey, which tracks the number of problems reported by customers per 100 vehicles sold. Fiat had 151 problems, tying with Daimler AG's Smart brand.

Mr. Marchionne acknowledged the lack of dealer profitability but said he is currently working on bringing the Fiat 500L to the U.S. in order to help the dealers. The Fiat 500L is a five-passenger model that will be produced in Serbia. It is slated to arrive in the U.S. sometime in 2013.

Fiat's Alfa Romeo brand, which originally was to be reintroduced to the U.S. in 2012 and sold through the Fiat showrooms, has now been delayed until sometime in 2013, although a date hasn't been set.

"The Alfa was the sweetener for those dealers who took on Fiat," another U.S. Fiat dealer said. "We knew Fiat would be risky but selling Alfa with Fiat made it more palatable."

Still there has been some progress with the Fiat brand. Chrysler executives expect year-to-date sales in the U.S. in June to top 20,000 for the first time. That would exceed the brand's total 2011 U.S. sales.

Dealership ranks have grown to 167 from 137 at the end of 2011, with a target of 200 in the next 12 months.

Bill Golling, who has two Detroit area dealerships selling Fiats, said he is expecting to sell almost 375 Fiats this year, surpassing his internal targets. Fiat showrooms are drawing younger and older customers, which he would have missed without the franchise.

"The brand has been strong," he said. "It just takes time and many dealers knew that when they got into it. As far as new product, I would rather it be delayed and that they get it right."

http://online.wsj.com/article/SB1000...274565512.html

[cryption]

Produced in Serbia? 500L you say.

[bzcat]

Produced in Serbia? 500L you say.

500L is not the additional model the article is referring to... but it is coming.

[manol2]

They can't come soon enough - Alfa and more FIAT models. Everything out there is so boring

[geza]

Produced in Serbia? 500L you say.

Yeap, Serbia

[MK5golf]

Can we get like, other fiat models please? This doesnt need to be a carbon copy of MINI, where all the models sold are basically variations of your bread and butter. (Mini's case is obviously the coopers, 500 with fiat).
Maybe we can have a decent alternative to Toyota or VW across the pond here, not just some "gimick" Fiats sell well in the rest of the world, lets see some more of em here !

[geza]

I don't think Fiat will offer a lot of European made cars for the US market. 500, 500C, 500L and 500X is probably everything you will see with the Fiat logo. Chrysler's new lineup will include some of Fiat's heavily modified cars.
But Alfa Romeo is coming, so stay tuned

[DJMRDARK]

Can we get like, other fiat models please? This doesnt need to be a carbon copy of MINI, where all the models sold are basically variations of your bread and butter. (Mini's case is obviously the coopers, 500 with fiat).
Maybe we can have a decent alternative to Toyota or VW across the pond here, not just some "gimick" Fiats sell well in the rest of the world, lets see some more of em here !

Thats not going to happen here. Did you see the 500X?



Which diverges significantly from the 500L.



And the Viaggio is a possibility at some point, though it is starting off in China.







And none of these cribs too much from the initial model anywhere near as severely as the Mini has done.

[Marcao]

pick and choose.. this is what we get here in Brazil



http://www.fiat.com.br/monte-seu-carro/

that viaggio it will be our new Linea..

[MikkiJayne]

It seems a bit shortsighted to limit production of the Abarth so it sells out, then complain that they haven't met sales targets

[DJMRDARK]

pick and choose.. this is what we get here in Brazil

http://www.fiat.com.br/monte-seu-carro/

that viaggio it will be our new Linea..

Yeah has an awesome lineup of Fiats. The Citroen, Pugs, and Renault lines are deep and good as well. That's one of the things I miss about Brasil.

[mac dre]

Hmm, I wonder how the Grande Punto would do as a competitor to the Golf, Focus, and Forte hatchback. I thought they always looked sharp when I visited Ireland.

Or would the 500L/CUV fill that niche better?

[Lwize]

Metallic green Doblo, please.

[Turbio!]

Fiat is playing its cards shrewdly. Most of the other European-only manufacturers are essentially stuck in Europe with their excess capacity, while Fiat has the escape hatch of its new American subsidiary and its dealer network. They won't make much money on Italan-built cars sold in the US, but they'll throw their plants and unions a bone in the form of full utilization.

I've heard rumors that the balance of power is shifting- that Chrysler folks are assuming dominant roles in the company, and that the focus of attention is shifting from the struggling Euro market to the more robust ones in China and the Americas.

[Turbio!]

Hmm, I wonder how the Grande Punto would do as a competitor to the Golf, Focus, and Forte hatchback. I thought they always looked sharp when I visited Ireland.

Or would the 500L/CUV fill that niche better?

The Punto is more of a Fiesta/Sonic/Fit competitor, as it's B-segment. My feeling is that the 500L is more in line with US tastes, but it's a pretty great little hatch.

[Aonarch]

Damn I didn't know Fiat had that many currently produced models!!!

[Turbio!]

Damn I didn't know Fiat had that many currently produced models!!!

It's a wide variety but it's not very deep, if that makes any sense. Anything called Strada, Siena, or Palio is the same car with different stuff going on behind the B-pillar. The Linea is a Punto sedan. And so forth. Most of them are built in Brasil for the domestic market.

[classicjetta]

Damn I didn't know Fiat had that many currently produced models!!!

Quite a few are unique to South America I believe.

[absoluteczech]

i only like the 500 from their line up, everything else they can keep. now alfa on the other hand..........

[Marcao]

almost all of them to south america...

but argentina and chile has some different ones..

[Wanganrunner]

They need to bring the Punto over, IMO it'd be a very servicable focus/elantra competitor, and it'd be far and away the sexiest thing in that class.

[Turbio!]

They need to bring the Punto over, IMO it'd be a very servicable focus/elantra competitor, and it'd be far and away the sexiest thing in that class.

Like I said above, it's not in that class. It's the size of a Yaris, Fiesta, or Rio - B-segment all the way. The Focus is much bigger.

[MidnightSpecial]

The Bravo would be a good choice for bread and butter.

Or the 5 door Punto with the T-Jet and Abarth trims.

[MK5golf]

Just taking a quick glance at their offerings, I think that they can make good in certain niches (Strada! how cool is that? mind you the baja failed...)
Maybe chrysler/dodge can continue to be mainstream, and fiat can start as more "niche" and build up form there?...
Alfas need to be priced right. They can look as beautiful as ever but if their being built fwd then they shouldnt be bimmer priced. (Which is what im worrying about)

[whitejeep1989]

pick and choose.. this is what we get here in Brazil



http://www.fiat.com.br/monte-seu-carro/

that viaggio it will be our new Linea..

That photo pretty much makes me wonder why people here in the USA are so desperate for more Euro Fiats to come to the States. Very little there seems to be well suited for the N.American market. Very weird looking and small vehicles that are conceived of for tight European communities are probably not what the American masses are pining for. I'm not sure how the Fiat brand becomes the "other" mass-market European brand in the States, without completely stomping all over Dodge/Chrysler.

[DTMTrini]

IMO, their Doblo and Strada would do good as fleet vehicles [colleges, parks, etc]. Finally saw my first Abarth 500 a few weeks ago...got to drive it too, not bad at all!

[aethelwulf]

That photo pretty much makes me wonder why people here in the USA are so desperate for more Euro Fiats to come to the States. Very little there seems to be well suited for the N.American market. Very weird looking and small vehicles that are conceived of for tight European communities are probably not what the American masses are pining for. I'm not sure how the Fiat brand becomes the "other" mass-market European brand in the States, without completely stomping all over Dodge/Chrysler.

Yeah, how many small hatchbacks do you need to sell? I mean, I love hatchbacks, but I don't need 11 different versions to choose from in one brand.

[manol2]

Only the Panda, 500 and their light commercial vehciles are competitive from current line up. Everything else is outdated and and outclassed, at least in Europe. Bravo is pretty poor, based off the Stilo platform, with some nice engines, the Punto is getting old as well they know that they have to be careful what to bring to the States.

[Turbio!]

That photo pretty much makes me wonder why people here in the USA are so desperate for more Euro Fiats to come to the States. Very little there seems to be well suited for the N.American market. Very weird looking and small vehicles that are conceived of for tight European communities are probably not what the American masses are pining for. I'm not sure how the Fiat brand becomes the "other" mass-market European brand in the States, without completely stomping all over Dodge/Chrysler.

Well, that's the Brazilian lineup, not the European one, and most of those cars are produced exclusively for the Latin American market. And the Brazilian lineup has to have a lot of options, because it's got a rapidly expanding middle class, a lot of people moving up from poverty to working class, and a healthy existing middle class. So they've got the Mille and Palio Fire that are dirt-cheap, the Uno that's a little more chic and just above entry level, the Palio (and its platformmates) that's one of the most common cars on the road, and the more European Punto, Bravo, and 500 topping the lineup of options.

I don't personally think most of those vehicles, or Fiat's European line, is especially well-suited to the American market, but it demonstrates that Fiat takes its local markets very seriously. I think we're seeing the results of that with the Dart.

For the US, Fiat shouldn't sell much more than the 500, 500L, 500X, and maybe the next-gen Punto.

[200HP4dr]

The Viaggio is is the Dart, right?

It will fun to see how Fiat continues to ease its way into the waters of the American market. Right now, its attempting to compete with Mini with a similar strategy. If it wants to move more units, it will be much more difficult to compete with the incredible raft of new small cars in the U.S.

Chris

[MidnightSpecial]

Well, that's the Brazilian lineup, not the European one, and most of those cars are produced exclusively for the Latin American market. And the Brazilian lineup has to have a lot of options, because it's got a rapidly expanding middle class, a lot of people moving up from poverty to working class, and a healthy existing middle class. So they've got the Mille and Palio Fire that are dirt-cheap, the Uno that's a little more chic and just above entry level, the Palio (and its platformmates) that's one of the most common cars on the road, and the more European Punto, Bravo, and 500 topping the lineup of options.

I don't personally think most of those vehicles, or Fiat's European line, is especially well-suited to the American market, but it demonstrates that Fiat takes its local markets very seriously. I think we're seeing the results of that with the Dart.

For the US, Fiat shouldn't sell much more than the 500, 500L, 500X, and maybe the next-gen Punto.

Actually, I forgot about the Uno. I've only seen one (3 door), but I think that if they took the 5 door and increased the size about 10-15%, it would do well in North America. The problem is that it rides on the Palio platform and there's no way in hell that it will ever pass N/A crash testing. Just put it on the Panda (as long as it doesn't have the awkward proportions of the Panda) platform, and sell it as competition for the Beat and Versa.

[WhistlerYOW]

Produced in Serbia? 500L you say.

I wonder if this would be the same factory that used to build the Yugo, I believe that is a Fiat facility now.

http://content.usatoday.com/communit...d-yugo-plant/1

[Swallow Doretti]

I wonder if this would be the same factory that used to build the Yugo, I believe that is a Fiat facility now.

http://content.usatoday.com/communit...d-yugo-plant/1

It is--Automotive News confirmed that yesterday.

[bzcat]

Quite a few are unique to South America I believe.

Only the new Uno is unique to South America. And it's basically a restyled Euroepan FIAT Panda so not that unique really.

Mille is the original mk1 Uno.
Palio is sold everywhere outside Western Europe.
Punto and Linea are sold everywhere.
All the commercial vans are identical to the European version too.

[MidnightSpecial]

Only the new Uno is unique to South America. And it's basically a restyled Euroepan FIAT Panda so not that unique really.

The new Uno is on the Palio platform.