Fiat Studies Marketing Approach to India

Italy's Fiat SpA tells The Wall Street Journal it will decide by early next year which of its brands to promote in India as it tries to catch such competitors as Suzuki, Toyota and Volkswagen.

Last year Fiat group sales slid 24% to only 16,100 vehicles as India's passenger vehicle market grew nearly 5% to 2.6 million units. None of the company's previous joint ventures in India, including its just-ended partnership with Tata Motors Ltd., has been successful.

Fiat currently assembles the Grande Punto supermini and Linea family sedan locally. It also sells imported Maserati and Ferrari supercars through a local distributor.

Enrico Atanasio, head of the company's commercial operations in India, tells the Journal that Fiat is assessing the prospects of virtually all its brands, including Chrysler and Jeep, for the Indian market. He expects the analysis to be completed in six to nine months.

The decision won't be easy. Importing cars is simpler, but foreign-made vehicles carry heavy import tariffs that make them uncompetitive in India's mass market. Local production avoids those taxes but would not be profitable until Fiat boosted its volume to several times the current level.