Fiat SpA is too dependent on Italian consumers and will try for greater market penetration in the rest of Europe as part of its comeback strategy, the head of the company’s auto division said.
According to The Associated Press (AP), Fiat Auto chief executive Herbert Demel told the Apcom news agency that over the next two years, the company’s strategy will see it “progressively ever more committed to innovation of the product and of quality, to penetration of the European markets, to the progressive growth of income.”
“Today we are a company which depends still too much on the Italian market,” Demel, a former executive at Volkswagen, Europe’s largest carmaker reportedly said.
AP noted that, for decades, Italian consumers were highly loyal to Fiat, but recent years have seen many of them increasingly buy other European cars as well as Asian brands.
Fiat’s new management has been pursuing the Agnelli family’s policy of putting efforts into Fiat’s auto division. The company has been banking on new models as an important way to turn around the division’s fortunes, the report added.
“Sure, we would like to see the results of our work immediately, but this doesn’t happen in our business,” Demel reportedly said, speaking at a gathering of car manufacturers in Turin, Fiat’s home. “Whoever is familiar with the automobile business is aware that is a difficult and rather long road and that it requires vision, plans, continuity and determination.”
AP added that, earlier this year, Demel said he hoped to halve Fiat Auto’s operating loss to about €500 million ($US620 million) in 2004.