Fiat 500 logs poor sales in China due to lack of brand awareness

Article by Anita Panait, on June 5, 2013

Even a tie-up with Italian luxury-goods maker Gucci failed to boost sales of the Fiat 500 city car in China. Fiat has aimed to establish the Italian minicar as a chic city car in China through the 500 by Gucci special edition, even calling it as "a fashion statement you can drive." But it seems consumers in the country did not get the Italian carmaker’s message, as Fiat only managed to sell less than 600 units of the entire 500 range in China in 2012, according to IHS Automotive.

Likewise, sales of the carmaker’s main mass-market model in China, the locally made Viaggio compact sedan, have been dismal. Fiat had expected to post 20,000 Viaggio sales in 2012, but only managed to sell 11,288. The carmaker also expects to log 100,000 Viaggio sales for this year, but only sold 12,212 from January to April, Morgan Stanley figures show. 

The Viaggio, a rebadged Dodge Dart, is being produced by a 50-50 joint venture between Fiat and Guangzhou Automobile Group -- GAC Fiat Automobiles – at a manufacturing site in the Changsha Economic Zone.

Despite the failure to meet the sales target for the Viaggio, GAC Fiat general manager John Burton is pleased with the progress the Italian brand has made so far. Namrita Chow, senior analyst at IHS Automotive in Shanghai, remarked that the compact segment is the most competitive as 94 locally build models aim to get a chunk of the market.

Chow remarked that the Fiat brand is not as well known in the country as its rivals, noting that Fiat needs increases brand awareness significantly across China. Burton shared the same view, noting that consumers in China have very high appreciation for Italian fashion and things, and Fiat needs to make a stronger effort to link its products to the Italian clothing and lifestyle.

The fate of the 500 by Gucci in China could be a bad omen for French carmakers PSA/Peugeot-Citroen and Renault, which are hoping to gain sales in the country by taking advantage of the consumer penchant for high-end French brands.

Topics: fiat, fiat 500, china, sales

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