TURIN - Fiat is slashing prices n its Punto in Italy and the UK to battle the hot Renault Clio 2. Other markets may follow.
In Italy, Fiat reduced prices from 6 to 10 percent in order to match the Clio. Dealer margins are being cut from 13 percent of retail price to 11.8 percent. Punto sales in Italy fell 3.5 percent to 132,453 units through April, and Italy's market is up 11.9 percent.
In the UK, Fiat plans a series of Puntos with lower prices, but a spokesman did not say how much lower.
'We will have a special series for the peak summer sales period, which is something most manufacturers do,' said Fiat Auto UK public relations director Peter Newton. 'It is not a reaction to the Clio, but it does have everything to do with all our competitors.'
Renault has postponed sales of the Clio 2 to employees in order to meet public demand. In Europe, Clio sales in the four months to April were up 7.1 percent to 127,571, while Punto sales were up 2.6 percent to 223,500.