Fiat faces Italian challenges image

Fiat Chrysler Automobiles Italian home market recovery is a tough road – with CEO Sergio Marchionne facing an aging line-up, plants that produce nothing and warrior unions.

Actually, according to analysts and industry observers, the situation in Fiat’s core home market looks very close to what the British had back at the start of the 1980s. The question is, will the similarities continue – there are no more locally owned automakers in UK, while for that matter last year the was actually Europe’s second biggest car producer.

Back in January, Marchionne and its company took the time to finish the long delayed reunion with Chrysler, taking full control of the US subsidiary and moving the new group’s location and main share listing outside Italy. Now, the long overdue plans to revive Alfa Romeo and Maserati are in full swing – and both brands put an emphasis on Italian production.

Marchionne even went and said that local plants will make “premium segment, high-quality products with reduced competition, more attentive customers and higher margins”.

“For a premium brand you need a broad offering of cars, but that’s very expensive and takes time,” said Commerzbank analyst Sascha Gommel. “I’m not sure Fiat can deliver that.”

Just like is the case with the British automotive sector, export is the main are of revenue that FCA aims to achieve – 80% of UK’s production goes outside the country. Mini for BMW and especially Jaguar Land Rover for India’s Tata have become big revenue providers and that’s what Fiat wants from Alfa and Maserati.

Via Reuters