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Old 19th November 2015, 20:59   #1
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Default Fiat floundering in U.S.

Fiat floundering in U.S.

Bill Cawthon

Larry Vellequette’s recent article in Automotive News highlights a longstanding problem that has faced Fiat dealers in the United States: new models aren’t increasing total sales.

In 2010, Fiat Chrysler CEO Sergio Marchionne predicted 50,000 sales per year for the Italian brand, as it returned to the U.S. market after leaving in 1983. Fiat had once rivaled Volkswagen for sales leadership in Europe, and he was confident that the new, larger, and greatly updated 500 and two new models to come later would, so to speak, make their marque on America.

Fiats are sold in standalone dealerships separate from any Chrysler lines.
With a massive marketing push, the 500 got off to a good start, hitting the 50,000/year pace in September 2012, just 19 months after it went on sale — but it hit the mark for just one month.

Not until August 2013, the third month after the introduction of the 500L, did sales hit the mark again. 2014 was the best sales year for the Fiat brand, with 46,121 Cinquecentos (500s) and 500Ls sold.

Things went downhill from there. Between October 2014 and October 2015, sales of the 500 fell 54% and sales of the 500L plunged 68%. Adding the 500X kept the brand 0.9% ahead in year-over-year comparisons, but sales of the other cars fell off a cliff. Last month, the only vehicles in its class with fewer sales than the 500L were all either new or had already been discontinued.
Mr. Vellequette wrote that dealers told him the 500X, while welcome, isn’t bringing in more showroom traffic. Buyers aren’t shopping outside of the 500X, they’re buying it instead of other Fiat models.

Bob Broderdorf, director of Fiat North America, told Mr. Vellequette that FCA executives are trying to figure out why 500 and 500L sales have dropped — how much is due to the general decline in small car sales, also affecting Mini, which Mr. Broberdorf attributed partly to falling gas prices.

Year-to-date sales of the smallest mainstream vehicles are down just 0.9%, while Fiat brand sales are off 21%.

Part of the problem may be that Americans just haven’t warmed to the 500L as much as the Europeans have. The 500L is the class leader in its segment in Europe, but averages only 936 sales per month in the U.S. In the short time the 500X has been available, its average sales are slightly higher, at 939/month, and they are increasing.

The other problem may be more serious. The Fiat 500 is a retro-styled vehicle that has been available in the U.S. for 56 months — close to five years. What does one do when the retro appeal wears off?

Chrysler axed the PT Cruiser; Ford dumped the T-Bird; and Chevrolet killed off the HHR. None of those were the core models of their brands.
The new Fiat 124 (“Fiata,” or “Miat”) may not help. It’s a whole different ball game and price class from the other Fiats.

The new Fiat Toro pickup, built in Brazil, may be one solution; aimed at South America, it will also be sold in South Africa. Its main issue is that it might cost too much to bring up to American safety and emissions rules.

At 193.5 inches from bumper to bumper, the Toro is about 20 inches longer than the Ram 700 (Fiat Strada) sold in Mexico, and has a 2,200-pound payload. With a four-foot bed, the Toro is about an inch longer than a Chrysler 200 and about ten inches shorter than a Toyota Tacoma or Nissan Frontier. It’s built on the same platform as the Jeep Renegade and Fiat 500X, and could be the perfect addition to reinventing Fiat in North America as a full-line compact brand.

This could make having standalone Fiat dealerships more viable, without having to make massive and costly changes to the current models. It would likely also make a better first impression on customers than a dealership that’s playing second fiddle to a used car lot.
Joe G.
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