China Car Times

When Nanjing Fiat first went into operation together in 1999, their cars were selling quite well. Although the models they offered were not terribly exciting, they did offer value for money with a reasonable options package. The models, Fiat Palio, Fiat Palio Weekend (Wagon version), and the Fiat Siena (sedan) were new and exciting when first launched, but their competitors, both foreign and domestic soon caught up with Fiat, and easily surpassed them.

Fiat entered into partnership with NAC in 1999, and sold over 24,000 cars in the first year of production, a sales number that is not at all bad for a company with previously no presance in China. Fiat introduced the Perla into China in 2006, with the hope of boosting Fiats yearly sales figures to the 40,000 marker. The Perla did not reach expectations, as the 2006 yearly sales were just over 37,000 over the combined Fiat range, although it was a year on year sales improvement of over 37%.

Fiat eventually broke off its joint venture with Nanjing Automobile for lack of sales, figure pointing from both sides blamed each other for the JV breakdown. Fiat said that Nanjing were taking away the brightest of Nanjing to work on the MG projects, Nanjing said that Fiat werent giving out any new models, and it was their own fault for falling sales.  Fiat has been shopping around in China since, and has signed deals with various automakers in the PRC. Zotye was on the receiving end of a deal to receive the rights to the Fiat Multipla, as well as various Lancia models, Chery were targetted to build the Alfra Range, and Guangzhou Autos were targetted recently for a technological exchange.

Fiats top man, Sergio Marchionne, has said that he wants to raise Fiats annual sales in China to 300,000 vehicles per year by 2010. Considering that in 2008, Fiat has only sold a handfull of vehicles, probably the last of the lines from the Nanjing Fiat JV, Fiat-China now has a massive task on its hand. But can they do it? The estimate from China Car Times is an optimistic one, Fiat can do it, but they need to bring the excitement of their Euro models into the PRC, otherwise the 300,000 cars per year figure is nothing but fantasy.

China has long been an automotive penal colony for Western car manufacturers, any model that was past its sell by date in Euroland ended up in production in China, although many models were embraced by the Chinese (Like the Santana, and the Jetta) other models were cast out like lepers, the Pegeuot 504 being one example. For Fiat to gain such a turn around by 2010, they need to introduce their full range of autos into China, with the same specification packages that are offered to European customers. Once full production is up and running in China, the Fiat range may not cost as much as the Euro range, but products specs should be left alone.

Fiats commitment to the Chinese market is commendable, although perhaps their re-entry into the Chinese market is more about offsetting sluggish Euro sales with a boost from the Chinese side. Hopefully with a true range of cars, rather than the ‘developing market’ cars that they were offering earlier on this decade, Fiat can truly suceed in China. By the time that domestic production of the recently introduced Fiat import line up, many of the original Fiat buyers may well be in the market for another Fiat, could brand loyalty still be big for Fiat after an absense from the market?