The JV between Tata Motors and the Italian car maker Fiat failed to yield the desired result- the expected sale. The JV is on the basis of 50:50 to involve in making engines and cars commonly. The plant in the state of Maharastra is benchmarked for this purpose and Tata has to take care of sales and service. Fiat is not involving directly in marketing, as its brands are to be retailed through the existing dealers of Tata Motors. However, Fiat’s MD for Fiat India seems to admit that the company is not confined to overall marketing, since Tata Motors is given the task of dealing Punto only. Fiat’s another brand Linea is yet to penetrate the market. With Fiat coming under the JV, Tata has to increase its dealerships from 60 to 175. Even this could not please Fiat that its brand has failed to impress the customers- just 1.6%share.
The Italian car company’s overall sale volume during 2009-10 had been impressive 208% but only meager amount of units could be seen in the Indian market. The Indian commercial car market had the capacity of 1.52 million of which Fiat could secure just 24806 units. The initial reaction among the dealers in this regard was not supple and they were not quite happy dealing with Fiat. But it seems the situation has just changed and gradual sale of Fiat is on the cards. Fiat has no good sign of sale for its brands- 2500 monthly units- which is still lesser than Maruti 800’s 2500 units. But the sources in Tata Motors said
that the JV is in full swing now and the sale of Fiat may increase soon. Sensing the trouble and confusion, Fiat has made efforts to segregate its brand under the Tata Motors dealers and is doing its business. It has appointed its own personnel at the desks to deal for its brands. Thus, Fiat has ignited its sale to a fast track.