Friday, April 15, 2016


After writing about Sergio Marchionne’s decision to cultivate massive debt to fund a new range FIAT and Chrysler models, it’s worth looking at the situation FIAT is in, in its home market – and Europe generally.

This is a company in trouble!

Take a look at FIAT’s current homegrown model lineup.

The passenger car range, with the exception of the baby 500

FIAT Panda
FIAT Linea

The Panda, Agea, Linea and Tipo are all derived from the aged (notice I didn’t say ‘ageing’) FIAT Stilo platform, first launched in 2001.

FIAT Fremont
The FIAT Fremont SUV is based on the Dodge Journey, and the FIAT 500 Cross X is based on the Jeep Renegade, as is the company’s first utility vehicle – the Toro.

FIAT 500 Cross X

 Although Marchionne cleverly brought FIAT back to profitability, the financial success he achieved in 2006 is proving difficult to maintain. Borrowing platforms from Chrysler-Jeep has been a brilliant decision and has provided new revenue streams from segments the company never previously participated in. However, the bedrock FIAT car range is OLD, OLD, OLD.

Chrysler 200
In the USA, Marchionne has dumped the Chrysler 200 and Dodge Dart platforms.
Dodge Dart

The Dart was the basis for the new Alfa Romeo Guilia, and he is hoping he can form a joint venture with another carmaker to create new models to replace the 200 and Dart!
Ringing every ounce of value from the 300,
it's even been badged as the Lancia Thema!

(It's also worth remembering that the very successful Chrysler 300 is based on a Mercedes-Benz platform that is at least two generations old!)

So far his attempts to create a joint venture have led nowhere, including his not-so-subtle suggestion that FCA and GM form a joint venture (rapidly rebuffed). This comes on top of Mitsubishi Motors announcing it will not produce a follow-up to the Lancer, unless it is spawned from a JV!

You can imagine the terror on the faces of motor company board members around the world, as they realize that their independence is vulnerable, unless they create workable joint ventures. The cost of developing new cars is becoming overwhelming.

FIAT 124 (nee Mazda MX5)
I think Marchionne definitely did something smart in joining up with Mazda to produce the FIAT 124. That was really clever. So, maybe Mazda might help him create a new line of FIAT passenger cars – on the cheap!

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