By on October 18, 2010

China isn’t the only big economy coming to play (sorry to burst your bubble, Herr Schmitt). [ED:No bubble. India is 10-15 years behind China, but they will definitely be next. China and India added will be a monster.] Just across the border, India is rising up and quickly, too. Car makers are desperately scrambling to get a foothold in the Indian market. And like the Chinese market, everyone is enjoying record growth in India. Well, almost everybody.

The Hindustan Times reports that Fiat is having a bit of a woeful time in Mother India. Using the Punto and the Linea, it was expected that Fiat would post its first profitable quarter in four years, during April to June. It didn’t. And that wasn’t the only thing that disappointed. According to the article, of all the car makers in India, Fiat was the only one whose sales dropped. During April to September this year, Fiat’s sales dropped by 8 percent. Last year, during the same period, Fiat sold 12,893 units. This year? 11,863. However, don’t be fooled. Some experts say it wasn’t the cars’ fault.

“It’s a classic case of how you falter with a winning product,” said an auto analyst, who, according to the article, gave the interview on the condition that they would have anonymity, “This is a celebrated car maker that has been in India for ages. They also have very good products but somehow manage to make a mess of it. First, it was the Uno and Siena then came the Palio and now the Linea and Punto.” So are they suggesting that someone in marketing is to blame?

The Hindustan Times has its own theory. The paper posits that there is a big gap in after-sales service, which went from being its own entity, to working with the Doshi group, to working with Tata. The Hindustan Times also suggests that maybe quality problems are to blame. They state the case of KV Subrahmanyam who bought a Fiat Linea and found that the air conditioning wasn’t working properly. He took it to Tata Motors, the people who now help run the Fiat dealerships, who said that the air conditioner’s problem stem from design problems, which Tata has no control over. Don’t you hate that when it happens?

Fiat India is more than aware of the slumping sales because on the 11/10/2010, The Economic Times of India reported that Fiat India and Tata Motors were meeting to discuss how to boost sales in India. Oh dear. I hope none of those quality problems permeate into Fiat’s dealings with Chrysler. That could be a cluster-you-know-what of epic proportions.

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4 Comments on “Fiat’s Poor Indian Summer...”

  • avatar

    who said that the air conditioner’s problem stem from design problems, which Tata has no control over
    ¡Que manera de lavarse las manos!

  • avatar

    One should also mention a couple of other factors. Since Fiat is using Tata dealers to push its product, apparently many of the dealers are pushing Tata products over Fiats. Another reason could be that India is a strong diesel market (thanks to diesel being subsidized/less taxed than gas). Now, Fiat has some excellent diesels in India. However, Fiat supplies the very same diesels to Suzuki/Maruti and Tata. Given Suzuki’s excellent service reputation, many potential diesel buyers go for a Suzuki instead of a Fiat.
    Lately, Fiat has become reluctant sharing its latest diesel upgrades and larger diesel engines with Suzuki, leaving Suzuki wanting. However, with with VW’s alliance with Suzuki, the utility of Fiat to Suzuki will be less critical moving forward.
    VW’s entry in India may be another reason for Fiat’s problems. They are now offering locally built, competitively priced models that match Fiat’s (relatively) solid feel as compared to its Asian competitors, with the added bonus of advanced diesel technology. Just 2 months after opening its Indian factory, VW has virtually gone from zero to outstripping Fiat by a factor of 2. It is possible that VW which currently is 9th in overall sales, could leapfrog Toyota and possibly Honda by early next year to take the 7th spot.

  • avatar
    Sammy B

    A Fiat in India that is not a Premier Padmini is destined to fail!
    Note: Premier Padmini is the model name for the Fiat 1100 rebadge sold from 1967-1997.

  • avatar

    I hate to point out TATA has its own vested interest, so they can be not all that eager to help out W issues on a Fix It Again Tony.
    FIAT should have her own repair network.
    When your after sales is so so, your sales will be reflected.
    Chinese saying ” If your effort is not there, money is not going to be there”

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