Fiat training dealers to capture and captivate the elusive consumer!

There was an interesting article in today’s edition of the Financial Times (Mon 15 Feb) concerning an initiative by Fiat to provide training for its network of 5,000 European dealers.  Like many car manufacturers Fiat depends on independent, frequently family-operated dealerships and only owns 1.5% of the total.

Marketing accounts for 30% of the cost of a car and the training and many of its dealers while good at selling are not so good an managing their businesses, developing new ideas and in service offerings around new and used cars.  The training, the cost of which is shared, teaches managers to be more like entrepreneurs and entrepreneurs to be more like managers.   All car manufacturers face the issues associated with not directly controlling dealerships and distributors.  But the impact of this on Fiat has been especially pronounced in Ireland

Sales of Fiat cars in Ireland have collapsed in the past decade.

 

Year	New Private Cars	Used Private Cars	Total Fiat Car sales in IE
1998	10,563	617	11,180
1999	12,311	566	12,877
2000	16,821	396	17,217
2001	10,558	279	10,837
2002	8,899	223	9,122
2003	5,632	211	5,843
2004	3,793	248	4,041
2005	2,623	339	2,962
2006	2,995	364	3,359
2007	2,451	383	2,834
2008	1,800	314	2,114
2009	841	233	1,074

 

Fiat’s overall sales of cars and light commercial vehicles increased from 1,857,000 units in 2004 to 2,229,000 in 2008 with increases recorded in France, Germany, Italy and Brazil but declines recorded in the UK, Spain, and Poland.

A new logo was launched on 26 October 2006.  Group Revenue increased from €51.8 billion that year to €59.3 billion in 2008.  Fiat automobiles account for €26.9 billion of total revenue Trading profit recovered from €1.9 billion in 2006 to €3.3 billion in 2008. Fiat automobiles account for just €601 million of trading profit, a decline of €112 million since 2007.  This decline was mainly attributable to Western Europe, where group automobile (Fiat, Abarth, Alfa Romeo, Lancia and Fiat Professional) deliveries fell to 1,237,900 units, but weak performance in Latin America also had an impact.  The passenger vehicle market in Western Europe declined by 8.4% in 2008 over 2007.  The most severe contraction in 2008 was in the Spanish market (-28.1%) but the British market dropped by 13.4% and the German market by 11.3%.

Ferrari won its 16th constructors world championship in 2008 and this success was rewarded with a 2% increase in unit sales to 6,587 vehicles.  North America accounted for 1,700 (26% of total) of these sales and new Ferrari stores were opened in Miami, Honolulu and San Francisco.

Sales in Europe, at 714 units reflected an 8.9% increase with pronounced growth in Eastern Europe.  Customers in The Middle East bought 366 Ferraris’ while customers in Japan bought 433 and in China 212.

Various versions of the F430 models, including the 430 Scuderia and the 599 GTB Fiorana were the most sought after Ferrrari’s in 2008.