Thursday, February 01, 2007

Fiat's "Bravo" to Determine it's Future???

The ANNOTICO Report

 

Fiat is putting a lot of faith in the "Bravo", which is merely a revamped version of the disastrous "Stilo".

 

Fiat CEO Sergio Marchionne claims that Stilo's electronics problems have been solved, that Bravo is offering only one version, has reduced the number of built-in extras, that has made it more price competitive.

 

 

Fiat's great wheeled hope launched in Italy

Reuters

Motor.com
By Gilles Castonguay
January 31, 2007

Milan, Italy - Fiat will take its first step towards meeting ambitious 2010 growth targets with Wednesday's launch in Rome of a car for the most important segment of the western European market.

The five-door Bravo will not only mark Fiat's return to the compact-car segment but also its effort to keep up the momentum gained from its quick recovery from the brink of collapse.

It will arrive in South Africa later this year.

Although strong sales of the Grande Punto last year led its key auto division to its first annual profit since 2000 last year Fiat has yet to prove sceptics wrong . Analysts such as Sanford Bernstein's Nicola Di Palma doubt it can repeat this success in a segment where it has failed to develop much of a presence in the last six years.

"It will be difficult for the Bravo," she said. "A disaster could repeat itself," she added, referring to the failure of the Bravo's predecessor,the Stilo.

Nevertheless Fiat, by reporting strong results quarter after quarter last year, has won the confidence of investors whose renewed demand for its stock nearly doubled its price in 2006.

Fiat has confirmed targets set under an ambitious growth strategy for 2007-2010, including a group trading profit of 2.5-billion to 2.7-billion.

The compact segment of the market (C segment) is important because automakers make more money from them than the smaller cars in their line-up . Sales in this segment have margins of four or five percent against a loss of one percent to a profit of three percent in the A and B segments, according to Di Palma.

The A and B segments comprise the smallest cars on the market, for which the Fiat brand is best known.

Fiat chief executive Sergio Marchionne has estimat ed the C segment to be the biggest part of the European market  about 25 percent of total sales  but Fiat's share has been paltry. In western Europe it was 15th with 1.6 percent in 2006 - though that excluded its Lancia and Alfa Romeo brands  and was far behind market leaders VW, GM's Opel and Ford, according to J.D. Power estimates.

The Bravo is seen as the key to demonstrating that Fiat has anything approaching a sustainable future. It's a revamped version of the Stilo and the first car to have been developed with Marchionne in charge.

In a bid to avoid the mistakes made with the Stilo - such as overly ambitious sales targets - it aims to sell a modest 120 000 units a year in tandem with Marchionne's view of never exaggerating the potential success of a new car.

Fiat brand head Luca De Meo has said the automaker had overcome Stilo's electronics problems and reduced the number of built-in extras that had priced it out of the segment.

Fiat has also made only one version of the Bravo compared with the Stilo's two. It is rolling out the Bravo at a time when few new models or significant upgrades by Volkswagen or other competitors in the same segment are coming on the road. – Reuters

 

http://www.motoring.co.za/index.php?fArticleId

=3655916&fSectionId=751&fSetId=381

 

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