BRAZIL-ASIA PUSH FIAT UP
THE GLOBAL AXIS WITH SUZUKI LEARNS
Dilma's samba brings joy to the Lingotto, struggling with the depression of the European four-wheeler market. Even this morning, in fact, Fiat + 4% represents the top of the purchases of Piazza Affari. The reason lies in the news, widely reported by the Financial Times, coming from Brazil, where President Dilma Roussef is about to present a package of measures to boost consumption focused on the auto sector, to counter the slowdown of 3% of registrations in the period January-April 2012. The plan puts measures in place such as the reduction of taxes and of security deposits, as well as easier access to credit. Great news for the group, given that Brazil represents around 20% of Fiat's revenues.
But behind the boom of the Turin house in Piazza Affari there could also be a leap in quality in the relations between the Lingotto and Suzuki. This is the thesis endorsed by the analysts of IHS Automotive and Cyrrus and taken up by both Reuters and Automotive News. At the origin there is the imminent end ofdistribution agreement in India for Fiat cars through the Tata Motors dealer network, a marriage soon interrupted after Ratan Tata, a member of the Fiat board of directors, chose to entrust the leadership of the automotive activities to Carl-Peter Foster, the former CEO of Opel, who has had bad relations with Sergio Marchionne since the time of the deal mandate between Turin and the German house registered GM. Fiat, as is known, thus decided to handle the marketing of the Fiat/Chrylser group brands on its own in the Indian subcontinent. But here the axis with Suzuki could be very useful, in turn engaged in a thunderous divorce from Volkswagen, which holds about 20% of the Japanese company, market leader in India with the house brand and the Maruti one. Fiat and Suzuki boast a decades-long relationship: the Fiat 16 is produced by the Japanese company in the Hungarian plant and the Lingotto has burned out the competition from Wolfsburg in supplying engines to the group. The expansion of the JV, according to analysts, would open up further opportunities for the Japanese manufacturer to access the Fiat engine range and – specifies Automotive News – could in turn open up the promising market of Brazil to Suzuki, where the leadership is held by Fiat. “A marriage between Suzuki and Fiat – said Deepesh Rathore, director of IHS Automotive for India – would be a win-win for both manufacturers, with infinite development possibilities”.
For Fiat, the advantage is even more evident. While the Chrysler operation has strengthened Fiat in the United States - Automotive News reiterates - Asia is still marginal for the Turin-based group with just 3% of sales in 2011. Neither Suzuki, which in turn is separating definitively from the former Volkswagen partner, nor Fiat have commented on the statements of Indian analysts and insiders. Maruti Suzuki sold 31 cars in India in the fiscal year that ended on March 855.730st. In the same period, Fiat sold 16.073 vehicles in India through Tata, a drop of 24%, against an average increase of 2,2% in the car market. “It is clear – said Ashvin Chotai, director of Intelligence Automotive Asia – that the cooperation with Tata has not worked. Especially after acquiring Jaguar Land Rover, Tata has other things to take care of." For Jiri Simara, an analyst at Cyrrus in Prague: “For Fiat Suzuki it could represent for Asia what Chrysler was in the United States, an easy approach to a rich market. And Fiat has many things to offer Suzuki – concluded Simara – because it still has an important name and many technologies in which Suzuki is interested”.
