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Glancing through the Pages of Fiat
Fiat is an Italian car manufacturer which is the world's sixth largest carmaker and Italy's number one. It was founded by Giovanni Agnelli with a group of investors in 1899. Fiat is an acronym for Fabbrica Italiana Automobili Torino which in English means Italian Automobile Factory of Turin.
Apart from manufacturing passenger cars, the company is engaged in making commercial vehicles, construction machinery, thermo-mechanics and telecommunications equipment, metallurgical products, engine components, railroad stock, tractors, and airplanes. Fiat has also ventured in bioengineering, transportation and financial services.
Fiat Group makes a variety of cars in its portfolio starting from small Fiat city cars to sports cars made by Ferrari, as well as vans and trucks ranging from the Ducato to Iveco commercial trucks. The Fiat Group comprises the Fiat Group Automobiles S.p.A, Ferrari S.p.A., Iveco S.p.A. and Maserati S.p.A. In addition, the Fiat Group Automobiles S.p.A. includes the Abarth & C. S.p.A., Alfa Romeo Automobiles S.p.A., Fiat Automobiles S.p.A., Fiat Professional and Lancia Automobiles S.p.A. Though 85 per cent of the Ferrari S.p.A. is owned by the Fiat Group, it is run autonomously.
Fiat’s first car is the 3 ½ CV that had a 697cc boxer twin engine. Around 1908 Fiat taxis became popular in Europe and by 1910, Fiat had a firmer grip in the car market and emerged as the largest automotive company in Italy - a position it has been retaining for hundred years till date.
Fiat supplied military machinery and vehicles during the World Wars. Post-war affect was at its heights with war-torn plants and antiquated production facilities and the death of Giovanni Agnelli in 1945. In an effort to restore its standing as the largest car maker in Italy, the new President and Managing Director of Fiat, Vittorio Valletta, applied to the US government for a loan. The US government granted Fiat a US $10 million, six-month revolving loan. Other loans soon followed and the company sprung back into action. By 1948, Fiat was able to contribute 6 per cent of Italy's industrial revenue.
After the World War II, Vittorio Valletta spent fifteen years in building the most impressive steelworks in Italy. Fiat sales reached US $644 million by 1959, representing one-third of its country's mechanical production and one-tenth of its total industrial output.
American carmakers such as General Motors, Ford and Chrysler began expanding their market in Europe and Fiat lacked the foresight to consider the influence of foreign-made cars in Italy and the Italians also grew wary of the Fiat models. As a result, in three years, from 1960 to 1963, Fiat's domestic sales dropped a massive 20 per cent, from 83 to 63 per cent.
The company encountered the loss with its 850 sedan and by 1965 Italian car imports had dropped to 11 percent. In the meantime, Fiat's exports improved and sales in underdeveloped nations prospered. In addition to its assembly plants in Germany and Austria, the company built plants in India, Morocco, Egypt, South Africa, Spain and Argentina. Fiat also signed an agreement with the Soviet Union in 1965 for a facility capable of producing 600,000 units a year by 1970.
Apart from manufacturing passenger cars, the company is engaged in making commercial vehicles, construction machinery, thermo-mechanics and telecommunications equipment, metallurgical products, engine components, railroad stock, tractors, and airplanes. Fiat has also ventured in bioengineering, transportation and financial services.
Fiat Group makes a variety of cars in its portfolio starting from small Fiat city cars to sports cars made by Ferrari, as well as vans and trucks ranging from the Ducato to Iveco commercial trucks. The Fiat Group comprises the Fiat Group Automobiles S.p.A, Ferrari S.p.A., Iveco S.p.A. and Maserati S.p.A. In addition, the Fiat Group Automobiles S.p.A. includes the Abarth & C. S.p.A., Alfa Romeo Automobiles S.p.A., Fiat Automobiles S.p.A., Fiat Professional and Lancia Automobiles S.p.A. Though 85 per cent of the Ferrari S.p.A. is owned by the Fiat Group, it is run autonomously.
Fiat’s first car is the 3 ½ CV that had a 697cc boxer twin engine. Around 1908 Fiat taxis became popular in Europe and by 1910, Fiat had a firmer grip in the car market and emerged as the largest automotive company in Italy - a position it has been retaining for hundred years till date.
Fiat supplied military machinery and vehicles during the World Wars. Post-war affect was at its heights with war-torn plants and antiquated production facilities and the death of Giovanni Agnelli in 1945. In an effort to restore its standing as the largest car maker in Italy, the new President and Managing Director of Fiat, Vittorio Valletta, applied to the US government for a loan. The US government granted Fiat a US $10 million, six-month revolving loan. Other loans soon followed and the company sprung back into action. By 1948, Fiat was able to contribute 6 per cent of Italy's industrial revenue.
After the World War II, Vittorio Valletta spent fifteen years in building the most impressive steelworks in Italy. Fiat sales reached US $644 million by 1959, representing one-third of its country's mechanical production and one-tenth of its total industrial output.
American carmakers such as General Motors, Ford and Chrysler began expanding their market in Europe and Fiat lacked the foresight to consider the influence of foreign-made cars in Italy and the Italians also grew wary of the Fiat models. As a result, in three years, from 1960 to 1963, Fiat's domestic sales dropped a massive 20 per cent, from 83 to 63 per cent.
The company encountered the loss with its 850 sedan and by 1965 Italian car imports had dropped to 11 percent. In the meantime, Fiat's exports improved and sales in underdeveloped nations prospered. In addition to its assembly plants in Germany and Austria, the company built plants in India, Morocco, Egypt, South Africa, Spain and Argentina. Fiat also signed an agreement with the Soviet Union in 1965 for a facility capable of producing 600,000 units a year by 1970.
Vittorio Valletta was succeeded in 1966 by the founder's grandson Giovanni Agnelli II. Under Agnelli's leadership, the company's annual sales came close to US$2 billion by 1968 and for a short time Fiat overtook Volkswagen’s fourth position as the world's largest carmaker.
In 1969, Fiat took full control of the Italian car manufacturer Lancia and announced a merger with Ferrari. The famous Italian racing car company had incurred losses and it was restructured as Fiat's Racing Car division. In 1972, for the first time in its history, Fiat failed to show a profit or pay an interim dividend. But, luckily business abroad was good and Fiat cars became the fourth largest selling import in the United States.
During this time, Fiat realized that it could beat its competitors by producing cars at the lowest-possible price. Through its subsidiary Comau, a leader in the automation field, Fiat retooled and partially robotized its factories. Fiat's bold and successful moves to modernize were matched by major changes abroad. The company entirely removed itself from the U.S. market, choosing not to compete against General Motors, Ford, Chrysler and Japanese imports. In South America, the company closed operations in Uruguay, Chile, Colombia, and Argentina, retaining only its facility in Brazil. Fiat's international operations were also brought under the patronage of a new holding company, the Fiat Group.
In 1986, Fiat purchased the luxury car manufacturer Alfa Romeo for US$1.75 billion. The following year, the first Alfa Romeo car to appear under Fiat ownership was launched which sold in huge numbers only in Italy. By 1993, the number of cars manufactured under the Alfa Romeo name had slipped to slightly over 100,000, roughly the same number produced in 1970 and considerably less than the number of cars manufactured before Fiat's takeover.
Fiat acquired the luxury car maker Maserati in 1989. The inclusion of Alfa Romeo and Maserati has widened Fiat’s collection of automobile lines. The late 1980s saw a steady annual sale of Alfa Romeo units and in 1993 Fiat introduced the Fiat Grande Punto, which is specifically designed to meet the needs of European drivers. In 2000, Fiat joined hands with General Motors for purchasing and power-train production. As a result of this agreement, Fiat Auto Holdings BV was created and became Fiat's main automotive sector, including automobile and light commercial vehicles, with the exception of Ferrari and Maserati.
Fiat ventured into the Indian market in 1944 with the Premier Automobiles Limited. The company began making Fiat 500 for the Indian market in 1951 which was followed by the Fiat 1100 in 1954. In 1973, the Premier name was used on its car for the first time and in 1984, the Fiat 124-based Premier 118 and 138D models were rolled out.
Fiat joined hands with Tata Motors and Fiat India Automobiles Private Limited (FIAPL) was born in 1997. Fiat manufactures the Palio Stile and Palio Stile Multijet in India and imports its Fiat 500 into India from Italy. The Fiat Linea was released in January 2009 and the Grande Punto was unleashed in India in June 2009. The Fiat plant is situated in Ranjangaon near Pune in Maharashtra.
Fiat has 242 manufacturing plants and 131 research and development centers in 61 countries. Forty-six percent of their production was generated outside Italy; exports accounted for over 67 percent of total sales. The success of Fiat's globalization strategy continues to depend on diversification.
In 1969, Fiat took full control of the Italian car manufacturer Lancia and announced a merger with Ferrari. The famous Italian racing car company had incurred losses and it was restructured as Fiat's Racing Car division. In 1972, for the first time in its history, Fiat failed to show a profit or pay an interim dividend. But, luckily business abroad was good and Fiat cars became the fourth largest selling import in the United States.
During this time, Fiat realized that it could beat its competitors by producing cars at the lowest-possible price. Through its subsidiary Comau, a leader in the automation field, Fiat retooled and partially robotized its factories. Fiat's bold and successful moves to modernize were matched by major changes abroad. The company entirely removed itself from the U.S. market, choosing not to compete against General Motors, Ford, Chrysler and Japanese imports. In South America, the company closed operations in Uruguay, Chile, Colombia, and Argentina, retaining only its facility in Brazil. Fiat's international operations were also brought under the patronage of a new holding company, the Fiat Group.
In 1986, Fiat purchased the luxury car manufacturer Alfa Romeo for US$1.75 billion. The following year, the first Alfa Romeo car to appear under Fiat ownership was launched which sold in huge numbers only in Italy. By 1993, the number of cars manufactured under the Alfa Romeo name had slipped to slightly over 100,000, roughly the same number produced in 1970 and considerably less than the number of cars manufactured before Fiat's takeover.
Fiat acquired the luxury car maker Maserati in 1989. The inclusion of Alfa Romeo and Maserati has widened Fiat’s collection of automobile lines. The late 1980s saw a steady annual sale of Alfa Romeo units and in 1993 Fiat introduced the Fiat Grande Punto, which is specifically designed to meet the needs of European drivers. In 2000, Fiat joined hands with General Motors for purchasing and power-train production. As a result of this agreement, Fiat Auto Holdings BV was created and became Fiat's main automotive sector, including automobile and light commercial vehicles, with the exception of Ferrari and Maserati.
Fiat ventured into the Indian market in 1944 with the Premier Automobiles Limited. The company began making Fiat 500 for the Indian market in 1951 which was followed by the Fiat 1100 in 1954. In 1973, the Premier name was used on its car for the first time and in 1984, the Fiat 124-based Premier 118 and 138D models were rolled out.
Fiat joined hands with Tata Motors and Fiat India Automobiles Private Limited (FIAPL) was born in 1997. Fiat manufactures the Palio Stile and Palio Stile Multijet in India and imports its Fiat 500 into India from Italy. The Fiat Linea was released in January 2009 and the Grande Punto was unleashed in India in June 2009. The Fiat plant is situated in Ranjangaon near Pune in Maharashtra.
Fiat has 242 manufacturing plants and 131 research and development centers in 61 countries. Forty-six percent of their production was generated outside Italy; exports accounted for over 67 percent of total sales. The success of Fiat's globalization strategy continues to depend on diversification.
