Tuesday, July 8, 2008

Automotive News - Industry Leader of 2008



Fiat S.p.A's CEO Sergio Marchionne was named Industry Leader of the Year 2008 by Automotive News.

In year 2004, when he took up the position, Fiat was losing $3.7 Million a day, there are talks of merging with General Motors, the Detroit giant which is now also in peril due to USA's horrendous automotive markets.

Today Fiat is back on the black, with most of their subsidiaries Alfa Romeo, Ferrari, Maserati, Lancia looks set to have strong product portfolio for the next few upcoming years.

From our looks of it, Fiat would still need to work very hard on a few areas:

1. Automotive sales are rising steeply in Asia, stagnant in Europe and dropping in North American markets, thou US is still the largest market in the world.

2. Asia is dominated by Japanese, Korean makes; traditionally well known for their reliability, a trait that doesn't ring a bell in consumer's minds for any of Fiat Group's offerings. Fiat need not only have to prove this otherwise, but to offer pricing advantages as well.

3. USA is now seeing a strong demand in smaller cars, something that Fiat did exceptionally well traditionally, but still would need to fend off the marching Japanese and Korean makes.

4. Alfa Romeo's 'comeback' into the USA market was strongly hampered by the recent fuel hike and strong demand for cheaper to run, cheaper to fuel, cheaper to maintain vehicles. The 159's good, but still a decade behind their intended competitors of Audi, BMW, Lexus and Mercedes.

5. Lancia thou sells more cars than Alfa Romeo as for time being, is very restricted in their product portfolio - and extremely ugly (WW would like to apologize for being harsh and sincere)

The summary? Well we all love Italian cars, and Fiat is as Italian as they are, but no one can run away from the harsh reality of cars being more and more costly to maintain, to run and to own. Hence they would need to prove this, they would really need some good marketing campaign, and create the same strong results in the 90s when Punto, Bravo, Bravia, 156 stormed the world, giving them a ranking of the world's 4th largest manufacturer.

Fiat currently ranks 10th largest manufacturer.

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