2018-03-07 11:00
Fiat Chrysler Automobiles boss Sergio Marchionne admitted at the Geneva Motor Show that the Italian brand was becoming less relevant in the European market.
And as he seeks to drive FCA into profitability, he said tough decisions needed to be made and cited Lancia, which now sells only the Ypsilon, as an example of what might be in store for Fiat.
“I understand that Fiat means a lot but its relevance in the marketplace is wrong. We need to make room for the emergence of the more powerful brands and protect the safety of the sales,” said Marchionne.
“We have had to restrict Lancia’s operations because its market appeal was limited. We need to start being unemotional about these things.”
The unstoppable rise of SUV sales is partially behind Marchionne’s thinking. The CEO said he expected them to take up more than 40 per cent of the European market by 2022, which would be a major problem for the Turin based company.
“Then we have an issue because trying to morph the Fiat brand into a market that is developing in that direction when we have a brand like Jeep is a bit nonsensical,” he explained. “And Alfa and Maserati, because of the attractiveness of the margins they generate, the preferred route for us to develop Europe.
“I am not killing Fiat. I think it has phenomenal prospects in Latin America. But in Europe it has a less relevant role because its emphasis will be on the 500 family and Panda. Those will be the mainstays of the brand in Europe and the ones we will continue to develop.
“I am less enamoured with the Tipo sector of the market because of the competitiveness we encounter. We need to be careful we don’t deploy large amounts of capital to chase an overcrowded market.”
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