Why Fiat is failing

[spidernut]

Ever wonder why Fiat is failing financially? Have you looked at their full 2014 lineup of models? BORING!!! Even the choice in photos is poor - almost every car is white. Talk about lack-luster!

http://www.fiat.com/com/cars

[Jimb]

I find it hard to believe they are failing, they are everywhere up here.
Extremely popular.
Jim

[So Cal Mark]

I don't believe they're failing, they're poised to buy the rest of the Chrysler stock from the UAW. The 500 sales numbers were in the 40000+ range last year. Some dealers are unhappy with their sales numbers, but most of the dealers I've interacted with are piss-poor examples. I'd say the dealer network is the only real failure

[djape1977]

i do agree with you that their cars are ugly. none of the models make me wish to buy them, but that said, it's the case with 99% of modern cars IMHO.
if they asked me,
fiat would still be making 124, 125, 131, 132
mercedes would be making w123 and w126
citroen would be making DS and CX
renault would be making r5 and r17
ford would be making 17m...

[vandor]

I'd be quite happy with a Panda. Basically a 500 station wagon.

[TX82FIAT]

I don't think a failing company could generate the cash (4.35 billion) to buy out the rest of Chrysler Group LLC. Sergio Marchionne is a bright guy. Not sure I trust him, but I trust he will manage better than the union. Think about the expanded global footprint to compete with GM, Toyota and others. "Cash is king", Economies of scale reduce production costs. Italian Unions have even less leverage to misdirect the company. There is a segment of the American public that will buy some of these models. I see two or three 500's on the roads in Texas every day. If you can sell 500's in quantity in Texas your off to a good start. If you are selling a good product you will succeed. The question I can't answer yet: Is FIAT building a quality product? If the answer is yes, then we do not have a failing business. They have been in business since 1899 and I would suspect they understand you need a quality product to survive. Therefore, I think it is premature to say they are failing.

[spidernut]

Here's why I said Fiat is failing:

QUOTE:

Chrysler already made more than half the group's first-half revenue, turning what would have been a 501 million euro ($690 million) loss for Fiat alone into a 435 million euro profit, while Fiat plants in Italy tick along at just 41 percent capacity, according to 2013 estimates from IHS Automotive.

A listing move would help Marchionne distance himself from troubles in Europe, where thousands of Fiat's Italian workers are on state-backed temporary lay-off schemes, highlight its gains in the United States and convince a larger pool of investors that the merged company can take the fight to rivals General Motors and Ford Motor Co.

"With a U.S. listing, the whole investment story and the way in which people think about this company may change," said International Strategy and Investment analyst George Galliers.

"Today people think of Fiat as a weak European player with a good exposure to South America and exposure to North America through Chrysler," he added. "Once you have a U.S. listing, people are more likely to think of the entity in the same context as they do Ford and GM."

END QUOTE

Fiat is not a mover or shaker in the automotive industry. Their models are lack-luster and sales in Europe prove it. The 500 has had some success here as it has in Europe. However, that's not enough to carry them long term in any market. The Doblo, Idea and Qubo are examples of cars that have very little appeal in the US Market.

They need something with more visual appeal and mechanical prowess. Fiat/Chrysler is a success due to Marchionne...hopefully he can get the Italian designers to design something as awesome as our Spiders but with modern reliability and features.

[So Cal Mark]

well, that's the writers' opinion. I just love it when "people don't like" is used without facts to back up the statement. "Some people say" is used when the writer is trying to convince the reader that it's not just his/her opinion. So the writer doesn't like the new Fiats. Big deal. My 500s are a total blast to drive

[RRoller123]

[spidernut]

I don't doubt the 500 is a fun car to drive. However, one model cannot carry a car company and most of the other models from Europe are lackluster or downright ugly (the Doblo for instance).

Fiat's market share in Europe is a joke and they are not profitable in Europe. America is just a small part of the world market for Fiat. It is the Chrysler brand that is carrying the Fiat brand now. Here's the link and an excerpt from the Boston Globe if you don't like the other source:

Quote from the Boston Globe:

"While Chrysler is doing well in the United States, with sales rising 9.3 percent last year, Fiat is faltering in Europe. Its European sales — which include its own brand, as well as Lancia, Chrysler, Alfa Romeo, and Jeep — fell 7.8 percent in the 11 months through November from the same period in 2012. That was far worse than the 2.7 percent decline in the overall European market.

In that time, the company’s market share slipped to 5.8 percent from 6.2 percent. But the picture is worse than it appears, said Harald Hendrikse, an analyst at Nomura. The company is overly reliant on Italy, which accounts for about a third of Fiat’s sales. Excluding Italy, he said, Fiat’s European market share is only about 2 percent.

“I don’t see how Chrysler is going to help them much in Europe,” he said.

In 2009, Fiat played white knight to Chrysler, providing the US company with leadership and technology at a moment of crisis. Chrysler’s Dodge Dart, for example, is built on a modified Alfa Romeo platform.

But now the roles are reversed. Chrysler has been providing virtually all of Fiat’s profit for the last three quarters, and with Europe’s car market expected to grow only about 3 percent this year, that is unlikely to change soon."

Full article: http://www.bostonglobe.com/business/201 ... story.html

[RRoller123]

I agree in the sense that they need more model variety in the US. I can't understand why they haven't taken any action on this? You can't tiptoe into the US market in just about anything, we US consumers generally require that you make a commit and dive in head first.

[djape1977]

dunno what US sales department is trying to convince you guys over the pond, but Doblo is considered a small van and used as such here in europe.

[124spiderman]

Failing?....I doubt it.
http://www.fiatspa.com/en-US/Pages/home.aspx

[TX82FIAT]

Again, I don't think FIAT is failing. When one personalizes an argument, one normally loses that argument. However, a day after posting the comment about reliability and an auto maker that has been in business since 1899 knows how to build a car.... I have seen not one but two 500's on the back of tow trucks. Carma is a B***. Todays cars are extremely durable by all standards. If this is to become a common site than I may have to recant my opinion.

[narfire]

I like their commercials......
Never driven the 500 though.