Fiat will be opening 20 exclusive dealerships in India by the end of 2012 in an effort to rebuild its supply network in the country after recently terminating its distribution agreement with Tata Motors, according to a spokesman of the carmaker’s local unit. Fiat, which had been selling its vehicles in India through Tata’s showrooms, opened its first exclusive showroom in the city of Hyderabad on May 9, 2012.
Fiat’s decision to end its six-year distribution agreement with Tata was prompted by years of dismal sales performance. The company follows the lead of other foreign carmakers operating in India -- like Honda, Nissan and Ford -- that have recently taken action to gain more control of their operations. Fiat has yet to reveal how much it will spend to develop its dealer network in India, where it sells around 20,000 vehicles per year.
The company currently lags behind other European and US carmakers in imposing their presence in high-growth Asian markets, particularly China. Fiat’s current lineup in India includes Linea, Palio and Punto, and there are plans to launch a new product line for the Asian country. The Italian carmaker also plans to introduce more brands -- Alfa Romeo, Chrysler, Dodge and Jeep – in the country.
Fiat is quite known in India for its 1100 sedan that was sold in the country from the mid-1950s to 1997, as the Fiat 1100 Delight and as the Padmini. The 1100 sedan is typically converted into a taxi unit in India.
The termination of the distribution agreement, however, does not affect a joint venture created by Fiat and Tata. The joint venture produces Fiat and Tata vehicles, engines and powertrains in Ranjangaon, India. The joint venture has produced a total of 190,000 cars and 337,000 powertrains.