TURIN - With help from new models, Fiat Auto now expects its sales in the second half to beat earlier forecasts.
Fiat expects to sell 2.5 million vehicles this year and push its share of the Italian market back over 40 percent.
Managing Director Roberto Testore made the forecast while addressing a hearing at Italy's Senate Industry Commission on 2 June. Testore said the company's medium-term target was to build 4 million units a year. He also said Fiat wants 10 percent of the Chinese market. Testore reconfirmed that Fiat is talking to Mitsubishi about a technical cooperation, but not a broad alliance.
Fiat wants to derive a vehicle from the Mitsubishi Pajero Pinin compact sport-utility. It could be launched as early as September, and would be built in Turin by Pininfarina, the Italian coachbuilder. Fiat is also interested in Mitsubishi's gasoline direct-injection engine technology. Meanwhile, Mitsubishi is considering equipping its European products with Fiat's JTD common-rail turbodiesel engines.
Fiat originally forecast sales of 2.3 million units this year, but Testore revised this figure upward. Sales of 2.5 million would be equivalent to the company's 1998 figures. Testore added that Fiat's goal to make 4 million units a year 'could be reached in the next decade.'
Fiat's domestic market share tumbled to 36.8 percent in the first five months of the year. It was 40.1 percent in the same period of 1998. But Testore said he expected Fiat to return to over 40 percent in Italy by the end of the year. The recovery will be fueled by the arrivals of the Fiat Punto replacement in June and the Lancia Lybra, due to replace the Dedra in September.
The Italian market will be 'close to 2.3 million units this year, a very good volume,' said Testore. Sales were just over 2.3 million last year. But Testore said the Italian market is becoming increasingly price sensitive.
In 1996, the year before scrappage incentives began, Italian prices were 101 percent of the western European average. Now they are 97.9 percent. 'Every single percentage point reduction costs us L200 billion (euro 103 million, $106 million) in lost revenue,' Testore said.
Testore expects the Brazilian market to be between 960,000 and 1.3 million sales this year. That is far from the record 1.9 million sold in 1997, but he expects recovery to start in the fourth quarter.
Fiat wants 10 percent of the developing Chinese car market.
'Today Chinese sales are just 400,000 units a year, but they will rapidly grow to 1 million,' Testore predicted. Fiat plans to make 100,000 units a year in its joint-venture plant at Nanjing, he said.
In January, Fiat spent around $60 million to establish a 50-50 joint venture with Yuejin Motor of Nanjing. Fiat will initially offer technical advice on the launch of a small commercial vehicle, derived from the first-generation Seat Ibiza. In about two years, the joint venture will begin building the commercial van derivative of the 178 world car program. This car is due to be launched in Europe in the second half of 2000, imported from Brazil.
Fiat develops new common-rail direct-injection turbodiesels, Page 18.