Financial Daily from THE HINDU group of publications
Tuesday, Mar 07, 2006
Alliances & Joint Ventures
Marketing - Channels and Franchises
Tata Motors, Fiat India to share dealer network
The agreement signed by Fiat Group and Tata Motors has provided for synergies in distribution, product development and manufacturing.
COMBINED NETWORK: Mr Rajiv Dube (left), Senior Vice-President (Manufacturing & Commercial-Passenger Cars Business Unit), Tata Motors, and Mr Giovanni de Filippis, Managing Director, Fiat India Pvt Ltd, at the launch of the Tata-Fiat Dealer Network in Mumbai on Monday. Shashi Ashiwal
Mumbai , March 6
Tata Motors and Fiat India Private Ltd have commenced their shared dealer network in 11 cities representing 70 per cent of Fiat's Indian market. The two companies are also examining synergies in distribution overseas.
The Tata-Fiat network comprises 25 existing Tata dealers and three from Fiat.
These 28 dealers would sell through their 44 outlets, the Fiat Palio (1.2 EL PS, 1.2 ELX, 1.6 Sports) and the Fiat Adventure (1.6 Sports), besides all Tata Motors passenger vehicles the Indica, Indigo, Indigo Marina, Sumo and Safari.
Asked about the absence of the Fiat Petra from the range, Tata Motors' spokesperson said the combined portfolio had been picked keeping in mind the need for complementary products and models that contributed best to strengthening the Fiat brand in the local market.
The entire Fiat range (including Petra) would continue to sell at the company's remaining dealerships; the Italian manufacturer has roughly 40 dealerships in India.
The Palio range would be available from Rs 3.8 lakh onward (ex-showroom Delhi); the 1.6 litre-Adventure Sports at a uniform price of Rs 5.65 lakh.
Kurla plant production
At a press briefing, Mr Giovanni de Filippis, Managing Director, Fiat India Private Ltd, said his company had restarted production at the Kurla plant and intended to ramp up production in line with sales trends emanating from the Tata-Fiat initiative.
While three Fiat dealers have been included in the first phase of the shared network, the rest would get the opportunity to graduate "on the strength of merit'' as business grows, Fiat India's spokesperson said.
Both Mr Giovanni de Filippis and Mr Rajiv Dube, Senior Vice-President (Manufacturing & Commercial - Passenger Cars Business Unit), Tata Motors, declined details on plans under the Fiat Group-Tata Motors MoU signed in September 2005.
The agreement had provided for synergies in distribution, product development and manufacturing. "We have just started off,'' Mr Dube said, pointing out that the two months to kick-off since indicating a joint dealer network in January had been fast indeed.
According to him, prospects for shared distribution overseas were being looked into, though it could not be said yet whether the business model adopted would be similar to the process just started in India or not.
"Discussions are on to explore other areas of co-operation on which specific announcements can be expected once their feasibility is established,'' an official statement said.
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