Fiat, the Italian car maker, on Wednesday launched one of its global bestsellers, the Grande Punto hatchback, in a bid to enter the volume segment of passenger car market in India.
The launch of the Punto is significant for Fiat — which has been struggling to make its presence felt in India since 2005 — because this car may well provide the company much needed sales volumes.
Till now, Fiat has been selling only premium hatchback Palio and premium sedan Linea (besides doing only 50 odd units of the Fiat 500) and managed to close last year with sales of just over 8,000 units. With the arrival of the Punto, the company is hoping to sell 70,000 units by 2010, an exponential growth in overall sales by any standard.
The car has been priced quite competitively despite current localisation level of only 58% and is available in 1.2 litre and 1.4 litre petrol options besides the 1.3 litre diesel. Rajeev Kapoor, managing director, Fiat India, is eyeing 2,000-2,500 unit sales of the Punto each month.
But will the Punto magic work? Kapoor said that the car would be available at all 99 dealerships (joint dealerships set up by Tata Motors which house Fiat cars) and 105 selling points.
He also assured of ready spare-parts’ availability, saying their prices have been benchmarked with competitors. Fiat has often been accused of neglecting after-sales services and spare-parts’ availability in the past. Kapoor is confident that under the joint venture with Tata Motors (which allows the use of Tata Motors’ sales and service network), Punto customers will face no hassles.
Much like distribution and servicing, the car is also being made under the Tata umbrella since it has been rolled out of Ranjangaon facility, which was established under a joint venture between Fiat and Tata Motors. The plant has installed capacity to make 1.6 lakh cars annually, besides 3.5 lakh units of powertrains.
Kapoor brushed aside any talk of cannibalisation of Tata cars with the Punto, saying that the product launch strategy of the two companies has been devised in such a way that chances of an overlap are already minimal.
He also made it clear that though the old version of the Indica is currently being assembled at Ranjangaon and the new sedan Tata proposes to launch, will also be made here; the Ranjangaon facility would be used to make more and more Fiat cars as demand rises.
“We plan to make and sell two lakh units of Fiat cars in India when the Indian car market reaches 2.5 million units in 2015. All this will be done from Ranjangaon,” Fiat Group International’s COO Silverio Bonfiglioli said. When asked about the fate of Tata cars from Ranjangaon, he said that the partnership between the two companies allows for flexible use of capacity at the plant.
The total investment outlay at Ranjangaon is Rs 4,000 crore for a capacity of two lakh units. The two partners are bringing just over Rs 1,300 crore of this money. Bonfiglioli said that Fiat plans to export cars from India as well and 10% of the company’s total production here would be sent to Fiat operations overseas.
Grand debut
Grande Punto is a 4- door hatchback, which comes in two petrol and one diesel engine displacement options
The 1.2 litre petrol version starts at Rs 3.99 lakh and the 1.4 litre version is priced at Rs 4.66 to Rs 5.61 lakh
The diesel Punto is priced in the range of Rs 4.85 lakh to Rs 6.11 lakh (all prices ex-showroom Delhi)
The 1.2 l petrol has a maximum power of 68.2 ps and diesel has 76 ps
The car is being positioned in the premium hatchback segment