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Fiat Undergoing a Tough Transition Amidst India's Auto Slowdown

Nagesh Basavanhalli, president and MD, Fiat Chrysler India, says the company is pulling all punches to revive customer confidence back. But it takes long to change perceptions. And the economic slowdown isn’t helping

Published: Feb 7, 2014 09:40:21 AM IST
Updated: Feb 7, 2014 09:42:00 AM IST
Fiat Undergoing a Tough Transition Amidst India's Auto Slowdown
Image: Amit Verma

Q: Last year was tough?
Last year was our year of transition post our arrangement with Tata Motors. On April 1, the new company was born and we formed a three-pillar strategy: Network expansion, product strategy and brand building. So, where did we end up? We said [we’d have] 100 exclusive dealerships by 2013 and we did 100 by December. We have another 20 points-of-sale from people who have signed up and are in the phase of construction. We will go to 150 soon and then see how it goes. But, why did we do this exclusive sales outlet? We wanted to be closer to the customer and give them international standard sales and service. We learnt lessons from the past. One of the [things] was to make spares available and affordable. We did both. How did we do that? We told every dealer coming in that the top 100 used spare parts have to be in stock. So, light bulbs, wipers, brake pads, whatever the case may be, have to be in stock.

The other thing we have done is starting a Fiat Amigo programme. ‘Amigo’ means friend in Italian. And if you buy a Fiat car, within 15 days a senior dealer representative will come to your place to explain the car; it is almost like a relationship manger. That has brought us closer to the customer. And we have done a lot of brand building. As a result we have seen quite a few ex-Fiat customers come back. Also, now we are five products. Fiat is no longer a two-product company. Now you’ve got the Linea Classic, the Punto, the new Linea, new Punto, Aventura and the Abarth 500. This will only help us bring in more customers in the Fiat fold.

Q: What is the capacity utilisation?
Just like everybody else, we are running below capacity.

Q: What happened to the Jeep Chrysler plans?
We had said that we will bring the Jeep to India and I made the announcement last month. Clearly we are committed to bringing Jeep to India. We have done a lot of market research and believe there is a lot of resonance. But then we looked at the economy in the last two quarters... and the auto industry and foreign exchange fluctuations. When you are introducing an iconic brand like Jeep, you want to ensure that you are looking at the long-term picture and introduce it when the timing is right. So, it has been deferred. We are just waiting and watching the environment but it will come. It is just a matter of time.

Q: Any time frame?
Well, we can’t predict the future but our goal is to bring it as soon as possible. As soon as the [economic] conditions improve, we will.

Q: Has Fiat been able to fix the perception problem it had with customers resulting from a loss of confidence?
The answer is as we all know, perception lacks reality. We are making improvements month-on-month and I believe the answer is yes. When we are doing customer camps, we have a data of 100,000 customers and the car park is about 200,000 cars. So we are calling all those customers back. And then when they are experiencing it, they can see the difference. As we all know perception takes a little longer to change. Month-on-month we are making a significant difference.

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  • Vikas Sharma

    Dear Forbes India, Please correct, the word AMIGO in your first question\'s answer. Its AMICO not AMIGO. AMIGO is a Spanish word. AMICO is a Italian word. Though meaning of both word is same but its FIAT AMICO Programme.

    on Mar 27, 2014
  • Vishal

    Hi want to know when is the aventura going to be launched

    on Feb 19, 2014
  • Sagar Deshmukh

    just want to know when fiat going to launch the new segment ??? aventura or linea???? this year in which month ??

    on Feb 9, 2014
  • Dr Sumit Deshpande

    We\'ll here I would like to question fiat, what is the problem that u r not bothers to respond to the demands and requirements of your customers, as of now I own a fiat linea 2009 since 5 years and due to upgrade. Frankly I was expecting a 1.6 litre multijet in linea 2014 but it\'s really sad to not to see it. Now I am really sorry unable to find the alternative to my linea and I am blind. I wish fiat does something by march. As I will have to leave my fiat club and get into some other equally stable and sturdy car for me like Octavia or so.

    on Feb 9, 2014
  • Dr K Shakthesh

    I do agree with what Mr Rengarajan has stated in a very light manner , its high time FIAT listen to its DIE HARD FANS.. No other brand has such a passionate fan following and its time to ponder what you have given back.. Its said\"OFFENSE is the best form of DEFENSE\". the best way to come out of low sales is to attract and retain customers by launching attractive brands and making them feel that you take care of their customers. Other makers are boasting of your technology on their cars( automated manual transmission) , while you re mum about whether it ll feature in any of your cars.. An I for one am crazy about the AVVY but id love to see it run on a more powerful engine say 1.6 MJD.. why cant you come out with it??? A DIEHARD FIAT FAN..

    on Feb 7, 2014
  • Rengarajan

    Thank you for making such wonderful cars, Mr. Nagesh. I owned a Palio before and now own a Linea T-Jet. Perceptions are formed based on actions and in this time and age, spread like wild fire. Hope you are aware that there is word out in the social media that the Avventura showcased in the Auto Expo 2014, does not have an engine. This perception stems from the fact, that your people are refusing to open the bonnet and there has been no official announcement about engine options. I am sure you are also aware of the responses your team provides on your FB page. I once posted an appreciative message and your team immediately responded with \"We apologize for the inconvenience caused. Please share your car and the issue details and we will do the needful at the earliest\". Now, if I perceive that your team does not read the feedback, would I be wrong? Set the actions right and perceptions will automatically change. Conduct a mystery shopper kind of programme and you will get the feedback on the real actions of the dealerships and can very well understand why the perceptions are so negative. All the best to FIAT.

    on Feb 7, 2014