By on September 18, 2012

Fiat CEO Sergio Marchionne vowed he will not close any of Fiat’s six Italian factories, Reuters reports. Actually, he says, he is a victim of circumstance:

“We’re in a dramatic situation here, and I’ve never talked about plant closures, I’ve never said I wanted to leave.”

And what about the awful sales of the new Panda? No, it is not selling because it is a bad car, says Marchionne. “It isn’t selling, because there is no market”.

 Fiat Group’s EU sales have been down 17 percent in the first eight months of the year, its home market Italy is down nearly 20 percent. Marchionne led a campaign for communal capacity shedding in Europe, only to attract the ire of mighty Volkswagen.

Reuters says  the Italian government will meet Fiat executives on Saturday to discuss Fiat’s strategy for Italy, the government said in a note on Tuesday.

Get the latest TTAC e-Newsletter!

17 Comments on “Marchionne Won’t Close Italian Fiat Plants, Overcapacity Be Damned...”


  • avatar
    schmitt trigger

    Let’s see how the CWA responds to that.

  • avatar
    GoFaster58

    The Panda isn’t selling “because there’s no market”? Then why build it? Marchionne is on another planet from all other auto makers.

    • 0 avatar
      el scotto

      Fiat probably had hundreds of millions in development costs. Somewhere along the way they probably hit a “point of no return”; couldn’t write off the hundreds of millions and the Panda was launched.

    • 0 avatar
      NMGOM

      GoFaster58…

      At this point in Europe’s downturn, you may be exactly right: the market has dried up, at least there.
      Ironically, the little Panda was once “Car of the Year” and a hot-selling “peasant’s car” that was cheap to buy, economical to run, and easy to fix. Kind of a modern day’s VW Beetle from the 1950′s.

      But it seems that even “peasants” want more car nowadays, as the VW Golf seems to dominate there, with its higher tech and higher prices, but also its higher performance and more capability.

      Still, Sergio is right: it is not a bad little car. It’s just that times have changed…

      ref: http://en.wikipedia.org/wiki/Fiat_Panda

      ————–

      • 0 avatar
        Bela Barenyi

        @NMGOM

        This is just not true. It’s not about a change of consumption, it’s
        about a sales decline in the Italian market. The most important market for the Fiat Panda was always the Italian market. This market is in decline. Due to the Euro/debt-crisis people don’t have money and they stick to the old car they own. Fiat suffers badly from this, because most of its products main market is the Italian, domestic market.

        To compare the Fiat Panda with the VW Golf is just ridiculous. The Fiat Panda is an A-segment car and the VW Golf is an C-segment car. Nobody cross-shops a VW Golf with a Fiat Panda.
        If you don’t have money to buy a new car and can’t even afford a new Panda, do you think anyone will say: “I lost my job, I have to stick my current old car, but who cares? I just go to my nearest VW dealer and buy a fully equiped VW Golf, with the biggest engine and all extras !”

        It also stupid to even slightly suggest that the Fiat Panda is a bad car. Small cars are what Fiat is good at. You might question the TwinAir engine or the fact that ESP is only an extra, so that you have to pay 300 Euro extra for it when you buy the new Panda, but to claim that it’s a bad car is outright wrong. Telling horror stories about rusting and unrealiable Fiats from the 1970s and 1980s is just a stupid “disease” like the “very original” Fix it again, Tony-jokes. It’s 2012 for christ sake.
        Many people are positively surprised by current Fiats cars, like one of my female colleagues. Normally she drives an old C-Class Mercedes-Benz (W202), but recently she had borrowed a new Fiat Panda for one weak from one of her friends, because her C-Class was in the workshop for service in that weak. She just fell in love with the Panda, because it’s much better for driving in the very dense city than her old C-Class and she drives mainly in the dense city traffic.
        I think many other people would consider a Fiat, but the Fiat brand is still plaqued with its bad reputation which dates back to the 1970s and 1980s. The said female colleague of mine never thought about buying a Fiat, because so many people advised her not to buy a Fiat, mainly by people who encountered a Fiat or other Italian car in the 1970s/1980s. And what do you expect from a fat old man (her father), who probably saw his genitals without the help of a mirror the last time in the 1970s, telling horror stories about rusting and unreliable Italian cars? Someone who never owned or drove a current Fiat/Lancia/Alfa makes judgements about these brands based on experience which dates back to the 1970s/1980s. I’m just fed up with these kind of people. Luckily, I could convince her (my colleague) to go and buy a Panda. She’s very happy with the car so far.

      • 0 avatar
        NMGOM

        Wow, Bela..

        I didn’t realize my relatively benign comments would trigger such a tirade. Didn’t mean to offend you. But, as I said, the Panda is not a bad little car, Sergio is right, and times, — they are a changin’. All car makers in Europe (not just Italy) have taken a beating in August, except two: VW and Kia. The Golf continues to sell well, so obviously someone is buying them …. probably even “peasants” (the term used in the website I referenced above) (^_^)…

        I believe one car magazine or website (can’t remember) a few months ago did exactly the comparison of a Fiat Panda and an “economy” VW Golf, — and surprisingly, the Panda came out quite well, but in the end, they chose the Golf.

        ————-

      • 0 avatar
        nvdw

        Just like Bela said, the smallest cars on the market actually do very well in Western Europe: compact, light, cheap, good on fuel and depreciation so low you barely save money by buying a three year old example.

        The Panda’s problems are indeed the Italian market, but also its TwinAir engine which did very well with journalists and the ‘EPA’ tests, yet not with the general buying public, who have already observed the old Panda with the venerable 1.2 four cylinder engine was just as quick, even more frugal and cheaper to buy. Extra variants, such as the semi-automatic transmission and the lower powered non-turbo TwinAir engine (the cheaper base model that is) can be ordered although delivery or actual production of the things has been delayed over and over again.

      • 0 avatar
        Felix Hoenikker

        Bela,
        If you visit this site frequently you will see that there are a lot of GM haters who hark back to the 70s/80s for their opinions. Back then, Fiat was only a little worse than GM in durability and reliability. Now GM builds very competitive cars, but still has to endure opinions set in the 70s. In order for Fiat to climb out of this hole and re-establish their brand in North America, they just need to follow Hyundai’s lead and offer the best warranty in the industry at the lowest price commpared to their competition. With Chrysler’s dealer network, they should have little trouble doing this if their product is competitive.

    • 0 avatar
      billfrombuckhead

      Actually Marchionne agrees with you and is holding off on introducing new products such a Brava replacement, Punto replacement, various Alfa Romeos and more. Why spend money to introduce products into a bad market?

      The Panda is an inexpensive car in a hot segment that was due for replacement.

  • avatar
    nickoo

    There’s always a market at the right price. Dump those fiats on US shores at 60s era VW prices (inflation adjusted of course) and you’ll find many a sales and many happy customers.

  • avatar
    Dimwit

    We’re getting into the brass tacks. This is a standoff with the winner being the last man standing. Chryco is allowing Sergio to stand tall. PSA looks weak as does Opel. Renault isn’t doing so well either.

    I think that he thinks that he can outlast those bunch, probably quite easily. A model here or there isn’t going to make that much of a difference.

  • avatar
    belfagor

    what happened to his sweater?

  • avatar
    Speed3

    Look guys, the new Panda is a good car. The most refined? No. Could it have been pushed further in this redesign? Probably. Its also “only” an A segment so its not like it needs to compete with the big boys on terms of equimpent and refinement.

    A huge chunk of Fiat sales come from Latin America and developing countries. This car will do just fine there if priced right.

    Finally, Fiat’s sales in Europe are tanking because 1) most their products are very dated, and 2) their strongest markets (Italy) and other Southern countries are collapsing with the recession in Europe.

  • avatar
    Speed3

    Oh and Sergio has lost weight and is looking GOOD!

  • avatar
    elwesingollo

    is right.
    The new Panda does not sell so well because the market is in decline.
    It ‘s still the best selling car in Italy with 79.324 cars from January to August. (http://www.slideshare.net/autoblog/mercato-auto-italia-agosto-2012)
    The real problem is that it has made ​​a promise to increase the models and the labor force, and is now retracting
    Fiat could export more models in North America and South America, at least they could build the new Punto five-door in Mexico, next to the 500


Back to TopLeave a Reply

You must be logged in to post a comment.

Subscribe without commenting

Recent Comments

New Car Research

Get a Free Dealer Quote

Staff

  • Authors

  • Brendan McAleer, Canada
  • Marcelo De Vasconcellos, Brazil
  • Matthias Gasnier, Australia
  • J & J Sutherland, Canada
  • Tycho de Feyter, China
  • W. Christian 'Mental' Ward, Abu Dhabi
  • Mark Stevenson, Canada
  • Faisal Ali Khan, India