Fiat will terminate production of mass-market cars in Italy

Article by Christian A., on May 22, 2018

It was back in 1899 when Fiat was first established in Turin, Italy. It has remained in one form or another for over a century. However, current CEO of the company, Sergio Marchionne, has said that the company will soon get rid of mass market vehicle production in the country. This June, the CEO will introduce new measures that will most Fiat production out of Italy.

Bloomberg has said that the Turin plant, which was inaugurated in 1939, will have the most major changes. What will happen is that the facility that presently produces fewer than 50,000 vehicles annually will have to accommodate a Maserati SUV together with the Levante, as well as several more Jeep products - this seems like a lot to handle.

As for Fiat models, the Panda will be moved to the Poland plant, while the MiTo’s production will have to be stopped. Its future has yet to be determined. The people who are in charge of this project do not want to be named since it is not meant to be public.

Fiat’s other plant, the one located in Pomigliano, will begin producing a new small Jeep SUV, with production scheduled to begin within a few months. Apparently, this model will be positioned underneath the current Renegade, and will likely have a hybrid powertrain. With the outgoing expansion of Jeep, the 500 and Panda might be the last two models that will be retained in Fiat’s lineup in Europe.

In a conversation between Bloomberg and Marchionne, the CEO stated that this is an incredibly complex jigsaw puzzle. He pointed out the economics and the return of time invested (not even return of capital), and the effort that’s required to make Europe reasonably profitable. The challenges would seem insurmountable.

Last March, Jeep’s European sales increased by 42 percent, while Fiat dropped by 12 percent. This huge drop pertaining to the Italian automaker caused FCA as a whole to post negative sales.

It is funny how Sergio Marrchionne, the CEO of Fiat Chrysler Automobiles, is actually going back to its roots (Italy), as his way to transform the company. Having said that, by June 1, we will be able to see a transformation of production in Italy as he unveils his huge plan to halt the production of the Punto and the Mito, so more upscale models can be produced.

The Italian executive, who is now on his 15th year as CEO, has not shied away from making bold and aggressive decisions on manufacturing. In 2016, he also decided to stop the production of the Dodge Dart as well as the Chrysler 200 sedans. The factories that manufactured these now build Jeep SUVs and Ram pickups.

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Topics: fiat, italy, production

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