By on May 9, 2014

FiatBrazil

After all was said and done and the dust settled on FCA’s presentation of future plans to investors a couple of days ago, many of us were still left wondering – what does FCA really have in store for Brazil? We all know what the “F” in FCA stands for and there’s a reason why it comes before the “C”. Part of that is the success Fiat has enjoyed in Brazil – which was heavily emphasized in the Fiat brand presentation. Brazil is a good indicator for Fiat’s plans in the Latin American market, and the rest of the globe.

This year, Fiat is doing well, even though Brazil is in a down market this year (Fiat is down about 5 percent). 2013 saw Fiat sell 785,000 cars – impressive given that its domestic production capacity is 800,000 units. Fiat will add another 400,000 units of capacity over the next few years, betting heavily on Brazil as a major engine of growth.

So what did FCA CEO Sergio Marchionne say about Brazil? No new nothing for brasileiros until 2016, when the new factory will kick off production of the new “City” car directly aimed at Volkswagen’s up!. More than likely, it will sport a 900cc two-cylinder engine that can add forced induction, producing 70 to 130 hp while keeping consumption (and emissions) to a minimum.

Besides that, baby Jeeps and Jeeps labeled as Fiat products will also come out of that new factory (4 new models, initially).These new CUVs will sit directly in the meat of the fastest growing segment in the world. Aside from giving Fiat more product, it’s an important step for the internationalization of the Jeep brand.

At the old factory in Betim, Minas Gerais, Fiat will phase out the venerable 178 series of cars, while the new Palio and Grand Siena line will sit on top a version of the platform underpinning the current Brazilian Punto. The new Uno that sits on the 326 platform, an evolution of the old 178, will move up to hybridized version of  326, and the Punto’s platform. The Strada pickup will survive, but its final form is unknown.

As the new European Punto will sit on the same platform as the future 500, Fiat Brazil is at a loss as to what to do with the Linea and Idea. That means that the Punto is, as we say in Portuguese, subiu no telhado (about to jump of the roof). The Viaggio and Ottimo (Fiat’s version of the Dart) also have unclear futures in Brazil. Both were supposed to arrive, but they have been delayed indefinitely.

Part of the reason is that, Fiat Brazil is now a smaller player in the global FCA realm, and must now compete with Chrysler for money. The slowdown of Fiat’s factory expansions in Brazil is evidence of this. However, the contracting car market does help Fiat. As they are operating at among the highest capacities in Brazil, the no launch of new cars is, at the moment, a welcome and lucky break. The current models are very competitive and are doing well in the market. Any new cars might just push the limits of Fiat’s capacity in South America too far.

The Uno, which is the cheapest car in Brazil has just got some “awesome” decorative fluff-ware, enough to keep interest, in the media and public, and keep the old factory chugging along until 2016. Then,Fiat will be ready for action and hungry to get the 1 million plus sales they need down here in order to prove signore Marchionne is right, and that FCA not only has a future, but a bright one at that

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51 Comments on “Dispatches Do Brasil: FCA’s Plans For Latin America...”


  • avatar

    Just a correction, it’s not the Uno that got some new awesomeness, but the Palio.

    • 0 avatar
      CoreyDL

      Seems like the Punto is the best looking of that group.

      • 0 avatar

        Would have to agree. It’s Italian. The others are Brazilian designs. I love the Uno’s design (white one) and is a very nice car. The Palio (red), well don’t like it that much, but it seems most people like it just fine. Finally, the Grand Siena (the sedan) has grown on me. Though the front is still too Asian, the profile is very nice and the back is very well done.

  • avatar
    Hummer

    I didn’t realize fiat was that big in South America, interesting. The above picture says 2.2m vehicles in 2013, what does that number represent vs. the 785,000 vehicles you mentioned?
    Although I have to wonder even with that many sales, does fiat really generate as much profit as the 4 Chrysler divisions?

    • 0 avatar

      The 2.2 million is the total of the A and B segments in Brazil or maybe Brazil and Argentina and other South American markets.

      As to generating profits, Fiat Brazil has kept Fiat Italy afloat for decades. It generates a lot of money. Just to illustrate, back in the day, Richard Wagoner (who was president of GM Brazil), when he became president of GM worldwide, in an interview to the Brazilian press (the man loved it here and spoke very good Portuguese!) mentioned that GM Brazil, while providing GM with 5% of global sales, also provided 20% of global profits.

      Yeah, a long time ago and sort of apples to oranges, but it sort of illustrates the point.

    • 0 avatar
      Viquitor

      Fiat is so firmly established here that in the early 2000s, before the GM pile of cash, Fiat considered for a while moving HQs to Brazil. Also, the idea of floating brazilian Fiat as a separate entity has been considered more than once, pretty much every time the italians found themselves into financial trouble.

  • avatar
    bobman

    Marcelo, it seems that the Jeep brand will also play a big role in increasing volume down there. I believe I read that it will be sold through the current Fiat distribution network. Is there a projected volume for the Jeep brand? How does that compare with the current volumes? Would you know? Are there other Chrysler products that currently sell in significant number in SA?

    Thanks for the focused SA report.

    • 0 avatar

      Hey bobman, you’re welcome.

      In 2013 Jeep was ranked 22nd with 3500 sales.
      Dodge 24 with 2800
      Chrysler 35 with 500

      According to the numbers I dug up Jeep sold 4.9% more in 13 than 12, while the Chrylser group as a whole grew 10.8% last year here in Brazil.

      The market for Chrysler vehicles in Brazil is very limited as they all sell for more than 150 000 reais, being their average price over 200 000.

      From what I heard the plan is to launch the Renegade and the Fiat version in 2016 (possibly very late in 2015) with local production. that means the Renegade would still be over 100 000 reais while the Fiat would be under. There will also be another smaller Jeep-Fiat duet, quite possibly off of the 500L platform. That should be cheaper.

      So they expect growth this year but pretty small. The Cherokee and Grand Cherokee will make their debut. The Renegade will probably only be imported as of 2015, but due to the prices, you can imagine the volumes will continue miniscule.

      For the foreseeable future, Chrysler brands will remain very small in Brazil.

      For now they have their own dealers. In very small numbers. As their presence grows, you might see some of their cars at Fiat dealers which have a very capillarized network here.

      EDIT: Just remembered Bobman, there are those here who want to sell the Dart as a Chrysler or Dodge and not as a Fiat. This struggle is far from over, but I still routinely see the car being tested near the factory and streets in my city. If Chrysler gets this car, their numbers will skyrocket. We will just have to wait and see.

      • 0 avatar
        dtremit

        Would the Dart fit nicely as a replacement for the Linea, or am I misunderstanding that market?

        • 0 avatar

          The Dart would substitute the Linea with a lot of advantages. It’s bigger, roomier. The Linea’s problem is that it’s larger than the Versa for example, but smaller than a Corolla or Civic (specifically, it’s narrower). So, in spite of it being better finished and more full of content than a Corolla or Focus sedan, it could never command the same prices due to its size. Then, it was pinched from below since cars like Versa, Cobalt even Fiat’s own Grand Siena are as big or bigger, though they also have less equipment, smaller engines, but are less pricey.

          Fiat tried to “force” the Linea into a role it couldn’t fill. Actually, like in Turkey and other places, there is a market for a relatively sophisticated car, lost somewhere between B and C segment sedans. If the Linea goes on, the Dart comes, and it starts being sold in its real segment, it could be a hit.

      • 0 avatar
        bobman

        Thanks Marcelo. I’m looking forward to seeing how this plan plays out. I’m sure there will be changes, however, without a plan, what does one change if things don’t go quite as expected? For that matter, without a plan, how can one tell that things are not going well.

        “want to sell the Dart as a Chrysler or Dodge”
        So there is a perception that the Chrysler (or Dodge) name would have market appeal over Fiat in various segments. Why would that be, considering neither brand sells in great numbers. Were they sold there in the past or just because they represent the American image like Levis and that sort of thing?

        • 0 avatar

          You’re absolutely right as to the plan. It’s a rough guideline going forward, the details are still being worked out.

          As to Chrysler’s image here, well the company has abandoned Brazil three times. Once when Iacoca negotiated the guarantees with the US government (which forced Chrysler to shutter plants abroad) and then when Daimler took over, shut down production of the Dakota pickup and later of the Tritec engine plant (that supplied Chrysler and BMW-Mini). BTW, the Brazilian government is still suing Daimler to get the subsidies that made that deal possible back. Ironically, Fiat now owns the engine factory and builds it e.torq engines there.

          On those value of brands rankings in Brazil, Fiat and VW alternate first place. They have a huge following and disputes between them and, specially, VW and GM fanboys are fun to watch. In the past Fiat had a lot of success with the Tempra as a step up from the base cars, and later relative success with the Marea (great car). Even with all the blunders Tempras are fast gaining collector status while Mareas are still bought by enthusiasts. So there is a market for larger Fiat cars in Brazil.

          However, like in other places there are those who turn their noses at Fiat. Most are of the “only Germans can make cars” school, but there are also “my car never breaks” Japanese-Korean car fans (they pretty much overlap, here). If the Dart were launched here as a Fiat, it would get very good numbers. If those numbers would be kept after a while, remains to be seen.

          I think the people who want the Dart as a Dodge or Chrysler, are those who believe that by doing so, the brand would be less polarizing and have the added advantage of being an “import” (even if built here) that always has a good drawing here and could thus command a higher initial pricing. However, there would be extra costs involved because “imports” also scare off a lot of potential buyers (wary of higher costs). If the Dart were launched as a Fiat, the good and bad of the Fiat baggage would come with it and it wouldn’t cost as much to launch as the name Fiat is an immediate draw.

          Anyway, since there is no production capacity, this is largely academic. I think that if the market really shrinks, they could launch it next year using up the extra capacity at the Betim plant. If the market is just a bit off (like right now) or stable, they won’t launch it. To be honest many were surprised there was no news about it, but I wasn’t due to the conditions they enjoy in our market right now.

          The car itself is “ready”. It can be launched pretty quickly. It makes no sense to launch it as an import now (and the accompanying higher prices) and nationalize it later and drop prices. That would be a sure way to anger early adopters.

          Fiat is content for now. Nothing new is needed. For now.

          • 0 avatar
            bobman

            Marcelo, thanks very much for taking the time for the indepth reply. Brazil’s auto auto history seems like it has developed from a rich and varied mix of different brands from all over the world. I’m imagining there exists more brands there than here in NA. I guess that reflects the cosmopolitan nature of the population.

          • 0 avatar
            djn

            Oi Marcelo
            All this talk about Dodge, Chrysler and Jeep is cause for a historical reminder.
            Jeep was produced in Brasil from the mid 1950’s by Aero Willy’s until they were bought out by Ford, and then produced well into the 70’s at least. At least 3 models, a Jeepster, a pickup and the classic jeep.

            Chrysler took over the Simca factory in the mid 1960’s and produced a version of the classic Dart called the Magnum, and a small car called the Polara, which was borrowed from the Hillman Avenger (think Plymouth Cricket)

            While Chrysler and Dodge aren’t producing locally, they are not strangers from Brasil.

            Also, maybe you can come up with a new title. Whenever I read the words “Dispatches do Brasil”, my mind says “Despachantes do Brasil” ;-)

          • 0 avatar

            hey djn! That’s why I said Chrysler left Brazil 3 times! Jeep like you said was built here first by Willys Overland and then Ford though Ford never “owned” it as Jeep became synonymous with Willys because people called the car “jipe Willys”. What was meant by that is that any car similar to the original Jeep is called jipe (which would just the Portuguese spelling of how we pronounce Jeep). So here, a Suzuki Samurai is a jipe. A Wrangler is a jipe. A Vitara is a jipe. A Chevy Captiva, a Ford EcoSport (or in the past a Rural or Veraneio). A Renault Duster, a Cayenne, a Tiguan are all jipes.

            So what sometimes happens people see a Cherokee and ask what is that. You answer, it’s a Jeep. People respond, I know it’s a jipe, but what kind?

            So Jeep was so successful that it became a word that names a class of cars. That is good and bad for Jeep, :)!

            As to Dodge, people remember them as big, powerful, ill-handling cars that did about 2km/l, something better to admire from afar. Dodge should be grateful people forgot the Polara…

            Anyway, we used to call one of our friends Dojão (Big Dodge). Why? Because he used to be good looking, he used to always show a lot of girls a good time, now the only thing he does is drink. Rightly or not, except for enthusiast, that’s the image (if any) non-enthusiasts have of Dodge. Chrysler is known cause lots of people have always called the cars Chrysler. Sort of like people relatively don’t call their cars Chevy, but rather say GM.

            Jeep is different. Fiat knows that.

  • avatar
    gtrslngr

    Marcelo de V

    So it seems Marchionne’s Madness is in full swing in Brazil . You have my sympathies . Stronzettos delusions will no doubt destroy what few profits * FCA could ever make down your way as well . Especially in light of y’alls tenuous at best economic situation [ and the rest of SAs as well ]

    * For the record de V … despite the published sales … ” numbers ” [ which Marchionne has a history of severely exaggerating ] the actual profits FCA and every other car manufacture doing business in Brazil ranges from abject minimal to abysmal loss

    Also for the record … neither FIAT Spa nor FCA has posted a single legitimate and verifiable profit since the 1980s . For the record neither FIAT Spa .. any of its divisions … nor FCA is wiling to make their books available for scrutiny . Which is why no legitimate financial/investment institution is willing to lend FCA a solitary dime or allow an IPA .. in any market

    BTW – Yes … most of us do know what the F stands for [Hint ; its not FIAT ] as well as the C [ Hint ; its not Chrysler either ] Not to mention according to Stronzettos long term vision [ yeah right ] as he talked about it to the Italian press …. the Chrysler moniker will slowly dissolve into the void … to be replaced with FIAT only .

    • 0 avatar

      Sort of my friend. The profits were gone last year because of the downspiraling trend of the real vs the dollar. That will be consolidated though and numbers will look up. It does serve a whole lot for whining and gnashing of teeth as they seek out more government assistance! Anyway the market is largely self contained, with high local content in cars. So we have that.

      What is threatening the whole country is the energy crisis. We’ve grown so much that we are feeling the energy crunch and prices will be pushed up accordingly. However, there is the fact that our election is this year so the vitriol is in full swing as pols jostle for position as does the press which has gotten suspiciously anti guv the last couple of months.

      I think we’ll survive.

      • 0 avatar
        gtrslngr

        Marcelo de V – You’d better ! Survive that is ! Between the music – food – people and culture theres too much to lose down there despite long term economic and political problems

        As far as why no one makes much if any profit doing business in Brazil though . Much of that has to do with the cost of doing business in Brazil … even for Brazilian businesses .. not to mention a government that manages to stick its hand in the till more often than not when they shouldn’t be .

        What that economic climate in Brazil has done to your music industry alone and especially your musicians should be considered criminal in my probably not so humble opinion .

        Ciao

        • 0 avatar

          Won’t dispute that either, but do to our historical legacy and its social consequences, plus the burden of the avarice of much of our better classes, I really can’t see the government not interfering.

          Tchau, cara. Abraço!

          • 0 avatar
            CoreyDL

            I’m going to read more about the Brazilian caste system. The company I work for is in the process of getting heavily involved in the Brazilian insurance industry.

          • 0 avatar

            It’s not THAT rigid, Corey! There has been a lot of upwards mobility lately. A little due to market realities, but also due to the government’s work.

            Be careful though, a famous Brazilian once said that Brazil is not for amateurs. With that he meant that nothing here is quite what it seems. Take it all with a grain of salt. :)

          • 0 avatar
            CoreyDL

            Well luckily, it’s not me doing all the work down there. We did send someone to live in Chile though, to do the Brazil and Chilean work.

            I’ve always seen the social system there categorized as “caste,” so that’s why I use that word! I wonder if I could find a documentary, in English.

          • 0 avatar

            Well, I have seen the word used too, but it’s just too much hyperbole.

            Chile and Brazil are very different. Chile is much more open economically, the population is much better educated and society as a whole is much more equitable. The only thing we have over them is size. Their whole economy is about the size of my state’s economy (the second largest or third, depends how you look, again nothing is as it seems).

          • 0 avatar
            CoreyDL

            Yes, he’s in Chile because we’ve been there since 2000 or 2001. We’re making lots of money apparently in our seguros de vida.

          • 0 avatar
            th009

            With regard to the upwards mobility, it appears that Brazil has some work to do yet. Both the gini coefficient and the intergenerational mobility score are at the “wrong end” of the chart …

            en.wikipedia.org/wiki/Great_Gatsby_curve

          • 0 avatar

            But that’s exactly it. Inequality has come down somewhat and mobility has improved and quickened the pace. I think mobility has existed in this country for many and in certain regions for decades, though slower. The last decade and a half I have seen it personally. Much, much more has to be done and I will tell you that there are certain sectors of society bothered by it (“how can a maid have a car? Increase gasoline, increase car prices, reduce parking, how can poor people eat meat everyday? the amazon is dying because of it” – just some of the things I’ve heard in recent years), but comparing to even 20 yrs ago, there are more people i better conditions than ever.

          • 0 avatar
            th009

            Yes, I agree, it looks like there has been a lot of improvement (looking from the outside … I have only made a single short trip to Sao Paulo, so no personal insight there).

            My point was that the situation is still pretty grim, roughly the same as China. But if people recognize the issue, maybe there is hope for more change in the future.

        • 0 avatar
          ect

          gtrslngr, “no one makes much if any profit doing business in Brazil”? It just ain’t so. I’ve worked fr companies that had very profitable businesses in Brazil, and other markets in Latin America – generating significantly higher margins than in Europe or North America.

          The business environment is different, and not easy to learn. But if you take the time and effort to learn it, you face less competition than in other markets (that everyone’s keen to be in).

          • 0 avatar
            gtrslngr

            ect – ” Worked for ” … not owned or on the Board of . Therefore you are only aware of that which your minders chose to tell you and not the actual financial facts at hand .

            Simply stated . The facts are .. though many a company are chalking up the numbers in Brazil as well as the rest of South America .. they all to a number are barely if at all making anything even resembling a Profit .. once the Pipers have all been Paid .

            Discuss this with someone deep within the financial world not the corporate to get an accurate appraisal of what is actually going on . Its pretty bleak .

          • 0 avatar
            ect

            gtrslngr,your reply demonstrates that, despite your bluster, you have no real world corporate experience.

            As a VP in these companies, I of course had access to – and an important role in achieving – the financial results I spoke of.

            My point stands. Yes, it’s not easy to do business in Latin America. But if you figure it out, it can be a very profitable market, at least in part because a lot of your competitors will succumb to the same prejudice you exhibit.

    • 0 avatar
      jimbob457

      @gtrslngr
      “the actual profits FCA and every other car manufacture doing business in Brazil ranges from abject minimal to abysmal loss”

      Generally speaking, Brazil has traditionally been one of the worst places in the world for any multi-national corporation to book net income. Good to see things have not changed. I would hate to think all the goofy expertise involved has become obsolete.

      Your use of the word ‘actual’ in the quote shown above is totally naïve and fundamentally incorrect. Book profits are simply being shifted outside of Brazil usually to avoid taxes and possible currency repatriation restrictions as well as a few other potential bad things.

      • 0 avatar
        gtrslngr

        jimbob457 – Actual Profits … as in actual monies left over after all the bills – expenses – taxes – fees – pay offs – graft – bribes etc are paid in full which then can actually BE counted as P-R-O-F-I-T . Not On Paper and /or claimed profits that have no relationship what so ever to reality .

        As far as my use of the word … in light of my ‘ business ‘ background ‘ … e.g. I actually own/owned / had/have part ownership in … not to mention the ‘ business ‘ a side of the family is deeply embedded in [ e,g, own … since 1905 ] and of which I am an active part of [ hint .. its in CH ] … not to mention who I consult for on a regular basis . I hardly think my use of the word is naive . Oh … and btw … did I forget to mention the business degree that went along with the conservatory training ?

        Hint ; One should not make such hasty judgements/assumptions about someone they know nothing about nor have any clue as to what his connections may be : nor should they assume that the specific
        definition of a word that they personally have in mind has any relationship what so ever to the overall context of the comment unless they know and understand fully from whom the comment came from .

        God I love a pedantic . Especially one in error . Always good for keeping one on ones toes .

        • 0 avatar

          Bribes? I thought French and German companies could write that off as a business expense? Talking of, though not car related, but still in transportation, there will be a lot of stink emanating from parliamentary investigative commissions and some very well-known Eurozone companies. Not everything goes away scotch free all the time.

        • 0 avatar
          jimbob457

          @gtrslngr
          Ever hear of “transfer pricing”? I thought not. You might want to Google it.

          “A little learning is a dang’rous thing;
          Drink deep, or taste not the Pierian spring”

          What fun to troll a troll. They are soooo easy.

        • 0 avatar
          Viquitor

          I’ve been auditing brazilian branches of international companies for the past eight years or so, with special focus on Income Tax. And I can tell you, without a shadow of a doubt, you’re wrong.

          The not-so-rare thing is a given company trying to lower its tax payments by writing of expenses that shouldn’t be there, or by cooking up some transfer pricing numbers. Sometimes there are thin capitalization issues. But mostly the profits are either there, or there’s investment for future profits.

          Brazil and its States have what maybe is the most sophisticated taxation system in the world, and there’s always someone trying to escape it. This is getting more and more difficult each year.

          • 0 avatar
            jimbob457

            @Viquitor

            Maybe I am wrong. It has happened more than once before.

            I do know from personal experience that in certain cases a big percentage of local business profits can end up in tax havens – places like Liechtenstein, the Isle of Man or the Cayman Islands.

            No doubt, an income tax on business profits seems to make good sense in a lot of ways – “Please relocate here. You don’t have to pay unless you do well”. The problem is that over time it is a hard tax to legislate and then collect.

            In the USA at the federal level corporate income tax collections declined from about 4.5% of GDP in the 1950’s to about 1.5% by the mid-to-late 2000’s. Within the USA attempts to levy a state or local corporate profits tax are moribund. Internationally, Germany (of all places) has the lowest effective tax rate on business profits of any major country. In short, any tax on business profits seems to me to be a dying system.

            The idea of multinational corporations trying to tax business profits strikes me as even less viable. An Italian company with a Brazilian subsidiary? Get serious. Neither country has what you might call a high reputation for their internal tax collection system, particularly as regards their rich and the powerful.

            Good luck in your efforts to regulate and monitor international business. I just don’t see that chasing accounting profits from one taxing jurisdiction to another is the best way to go.

          • 0 avatar
            Viquitor

            @jimbob no country taxes the way we do. Trust me on that. Yes, there’ll always be money flowing to tax heavens, and yes, it is difficult to tax multinational corporations. But no country taxes the way we do. One of the reasons is that we don’t always tax profits, but actual gross income.

  • avatar
    gtrslngr

    Marcelo de V – Totally off topic question I’ve been meaning to ask . I know that the de [ or De ] prefix generally implies gentry and/or upper class in Brazilian/Portuguese .. and you do have an extra l in your name …. but by any chance are you at all related to percussionist Nana Vasconcelos ?

    If so our 6 degrees of separation just shrunk by a factor of 2 .

    • 0 avatar

      Don’t think so gtrslngr. Our extra “l” is also an affectation and serves to differentiate us from other Vasconcelos. With one l that family was more prevalent in the north of Brazil. However, if you know any Vasconcellos with 2 Ls and they come from the country in Rio de Janeiro state or Minas Gerais, then you know a relative.

      My grandmother used to like this kind of thing and it seems the King of Portugal sent the family off to Brazil on the second boat with settlers. What she wouldn’t mention, but I do know, is that the King of Portugal used that tactic to deal with large numbers of the small, rural, broken nobility that tenaciously clung to the court in Lisbon at the time.

      If monarchy ever makes a come back in Portugal, it’d seem the fmily would have a legitimate claim, LOL!

      Though Naná was close to Milton and Milton was close to my mother’s family. Another story for another time.

  • avatar
    th009

    Marcelo, is there any news on the currently-zombie automotive free trade agreement (ACE 55) with Mexico? Is there any likelihood of change if Rousseff is re-elected? Would Campos or Neves be any different?

    It might not be great for Brazilian manufacturing profits, but the increased competition would be good for the consumers.

    • 0 avatar

      It still exists in the sense that Mexico accepted the quota system that Brazil wanted. So it’s now a sort of quota based free trade.

      Sincerely th009, I see little difference between the candidates. Some focus more on one aspect, the other wants to pay more attention to that. None will throw the doors open.

      In more than one sense the PT government was a continuation of the previous PSDB government that Neves now intends to represent. The former governments were more focused on austerity, monetary measures to control inflation. The current one believes more in spending. Neither are too radical.

      All candidates believe it’s necessary to protect and foment national industry.

      • 0 avatar
        th009

        Unfortunate, I think. In the long term, Brazil needs to be internationally competitive. Expensive real, heavy bureacracy, difficult labour market and protectionist policies mean that local industries have little need to work harder and become competitive.

        And for the same reason the outlook for Brazilian auto exports is not good, either.

        • 0 avatar

          Long-term, sure, we will need to open up. For the moment, based on our educational levels, inefficiencies and other things, I do believe the course is by and large correct, though by no means perfect. Educate these people, then let them loose. It’s all I hope for.

  • avatar
    Magnusmaster

    Don’t the Palio and Grand Siena ride on the 326 platform? Or you mean their replacements? Idea will get replaced by a new crossover model. That crossover model will NOT be the 500X, but a new model for emerging markets, which will be based on the new larger compact pickup which will coexist with the Strada for a while. Hopefully they bring the SUSW platform…

    • 0 avatar
      Viquitor

      New Palio rides on the 326. The Uno rides on the slightly narrower and lighter 327. The Grand Siena rides on the 326 but with the Punto’s rear axle. Their replacements are likely to be more Punto than 326. Whatever that means.

      On a side note, the new Fiorino is half 326, half 178-based Strada. But looks like a Uno.

      • 0 avatar

        Viquitor, Magnusmaster, that’s it. Like Viquitor pointed out on another post, a lot of these platforms are worked on, re-worked on, developed, mashed together, so much so that even Fiat people don’t know (just kidding of course, but for effect). Trying to summarize:
        – the Uno will be re-worked, staying on their current platform, but this platform will receive elements from the hybrid already under the Brazilian Punto;
        – the Palio/Grand Siena will “leave” the 326 and become closer to the Punto. What that means is still under contention. Will it be a re-worked version of the current hybrid under the Punto, or a mixture of that and some future 500 bits?

        That is the contention, both are being studied as there is no definition if Punto will even survive. If it does, will it be a re-worked Brazilian Punto (even closer to the Palio) or will it be more similar or even the same as the European one (very close to the new 500)? Same holds true for Idea. There will be one, but linked to Uno or Palio line? Strada the same, right now they are working on a pickup that technically has been described to me as similar to the US Honda Element. It uses the same underpinnings as the Fiorino, but reworked yet again, making the 178 part just part of the “strength” and for the length.

        Heck everything is in the open. I have even heard people asking that when the current Freemont/Journey moves on, the old tooling come here for them to do what they think they need.

        Let’s see.

        • 0 avatar
          Magnusmaster

          Why can’t they just use the European platforms instead of all this improvisation? I get Mini is too small, but why not SCSS/Gamma? GM is already using it. Is it probably due to a license issue with GM or just Fiat being cheap?

          • 0 avatar
            djn

            My guess is the cost of “Tropicalizando”. Brasilian chassis are strengthened and well as beefing up the suspension bits so the crappy roads won’t shake the car to pieces in a few months.

          • 0 avatar

            You say improv, they say “high level engineering”, ha!
            Can’t really say, Magnusmaster, but it does have to do with costs. They want to strecth all they can out of the peso you give them or the real I give them? Sure,

            That is not to say that some high level engineering is not going on here. The whole raison d’ être of the 178 and 326 lines was the robustness. That has nit gone away.

            I’m closer to Fiat than other makes down here, I see some things here that I don’t at other places. If it means that Fiat does it while others don’t I don’t know.

            All of this to say that they have a pretty hefty engineering commitment going on here (Córdoba too). If what they’re doing is good or bad, depends on what you value.

            In other words, they take the tine to develop and bring on (cheaply) what works here. It’s either that or One World. I have the feeling some local knowhow is important. Do you?

          • 0 avatar
            Viquitor

            It’s Fiat being profitable. Hugely profitable. In the early 90’s we used to talk about how GM was more profitable than Autolatina, even when the Gol was selling like hotcakes and all GM had was the Kadett and the Monza. It was mainly due to added value.

            Fiat found a way to make cheap cars more profitable by extending the life cycle of platforms, while keeping people interested via updates that are not quite skin-deep. Amortization of project costs is long finished for the 178. And just think about what they did to the original Uno.

            Bringing European hardware would be a lot less profitable. They make cars the exact way Brazilians love – they look new, they tell the neighbors who’s who at the condo. They drive like crap, but depreciation is fine, maintenance is easy. And that’s it.

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