Posted in Marketing & Strategy Articles, Total Reads: 8609
, Published on 31 October 2010
FIAT, the 6th largest car maker in the world, is based in Italy. Its a brand that is well known around the world and is present in many countries including India.
FIAT has had a very strange relationship with India. We all do remember the Premier Padmini which was on roads till 2000. Even today majority of the TAXI's in Mumbai are Padmini.
Premier Padmini is a word that sounds a little lesser known and lesser recognized. But when a mention is made that majority of the TAXIs in Mumbai are FIATs, it makes a lot more sense.
Both sentences are somewhat true. In India, a company named Premier Automobiles Limited(PAL) started making a version of FIAT cars in India. In 1951, they began producing versions of the Fiat 500 for the Indian market. This was followed by the Fiat 1100 in 1954. In 1973, the Premier name was used on their vehicles for the first time, the Premier President, based on the Fiat 1100 as Premier Padmini. In 1978, they launched the Fiat 124-based Premier 118 and 138D models. Over the years, Premier Padmini could not establish its brand and the car was always referred to as FIAT in public. Decades went by but the name and main design of the car didn't change at all. For decades, the car came to be known by just FIAT. Many people knew that this is Padmini, made by an Indian company, on some FIAT's design. But in Pre-Liberalized India, it was the supreme vehicle.
A yesteryear print ad of Premier Padmini is also shared below.
All these things changed when FIAT actually came to India post liberalization, they entered India with FIAT UNO in 1996 with PAL as partners but things didn't work out as PAL delivered just 617 cars out of 30000 ordered. Then in 1997 they again launched it with a JV with TATA Motors.
The problem with FIAT was that the image that people had of FIAT was the Premier Padmini. That image refused to go away from people's mind.
FIAT tried hard in Indian markets, but Indians had moved on with Maruti and were apprehensive about FIAT and its image of the old FIAT 1100 (the 19 50's Italian model which we see even today on Indian roads).
Even then Fiat UNO picked up well. Uno was initially a success in India, but then it faded badly due to poor dealer support.
Here comes the reason where the case becomes a lot more curious.
People often go to a TATA Showroom to enquire about Fiat Punto. After some talk about FIAT cars, the salesmen themselves suggest TATA Safari and Indigo. FIAT and TATA Motors have common showrooms at major places. So this is a problem,a big one.
In India FIAT has two major problems
1) The old brand image made by Premier Padmini is still stuck in the mind of people.
2) Problem with partners at the actual touch point and service centers.
The first point is fading with cars like Punto, Linea coming out of the FIAT brand name. But what about point number 2. This reason is actually acting against FIAT and many consumers are shying away from FIAT due to it.
Now FIAT is totally dependent on TATA Motors for Sales, Service and Spares. This is a point where FIAT needs to more independent. They cant allow this to be their weak point in India.
There are 11 companies in India in passenger car segment. With Maruti having 60% of market share, things are tough for the other 10 companies.
Things are improving for FIAT as the sales are improving for them but the above two points really need to be sorted out.
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