Return
to Story Page
To print: Select File and then Print from your
browser's menu
OUR CORPORATE BUREAU
New Delhi, Sept 14: The $50-billion Fiat group has decided to enter the financial services and insurance sectors in the country. To start with, Fidis, Fiat's financiang arm, is setting up a subsidiary with an Indian partner to handle car retail financing activities.
Speaking to reporters here on Monday, Fiat spA senior vice-president (international affairs) Andrea Simoncelli said, "The group, which has interests in automotive sector, components and farm machinery in the country, is now planning a foray into financial services and insurance."
Fiat group treasurer Paolo Castagna disclosed, "We are analysing the possibility of setting up a joint venture in India through Fidis and for providing retail finances for our cars initially." The group is at present in negotiations with an Indian partner for the venture.
"Later, we will enlarge our portfolio and venture into other financing possibilities," he added. Of the proposed $1-billion investment between 1997 and 2002 -- in what it perceives as a promisingmarket -- Fiat group will inject $200 million in its various joint ventures by 1998-end, Simoncelli said.
On the group's plans to enter insurance, he said that the plans will be finalised pursuant to the formulation of a legislation.
On the company's earlier announced plans to set up joint ventures in the food processing and chemical business, Simoncelli said these businesses were sold off in Italy recently as part of the group's restructuring programme. "We are now looking at working only in our core areas, that is mechanical and automotive. We have disposed off the chemical portfolio recently and so there are no plans to pursue it here."
The Fiat top brass was here to sign a MoU with the Indian Institute of Technology, Delhi, for technical and scientific cooperation in subjects relevant to the manufacturing world and vehicles. The Fiat Research Centre will offer remunerated periods at its facilities in Turin to graduate students to IIT. This may also extend to joint researches for Fiatcompanies.
Elaborating on the group's Palio 178 world car project coming up at Ranjangaon in Maharashtra, he said that the first car from this range would be launched next year.
"The 178 range, a family of five vehicles, would be manufactured in India before long and we would introduce the first car for India in 1999," he added. The Palio family consists of a hatchback, the Siena saloon and weekend station wagon, Simoncelli said, adding that a pick-up version and a van were being developed.
Palio would have a higher indigenisation level from the first vehicle itself and the company hopes to attain the 70 per cent level much ahead of the stipulated five years, he said.
Fiat is also considering manufacturing the engines and transmission system locally, Simoncelli said. The company is "doing very well now thanks to the growing sales of Uno diesel," he added.
Simoncelli said Fiat had already introduced two of its ancilliary units -- Magnetti Marelli and Comau -- in the country and both were located inPune.
While Magneti Marelli will manufacture car components, Comau India specialises in the creation of high-tech manufacturing systems. Fiat has also set up a company for development and training -- Isvor India in Pune, which will train managers for Fiat group companies as well as other companies.
Regarding Fiat's tie-up with Ashok Leyland, he said the joint venture would invest around Rs 60 crore, of which Fiat's contribution is Rs 9 crore this year. As part of its globalisation plans, Fiat would bring its 30 to 40 component manufacturers to India to source ancilliary products for the car project.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
------------------------------------------------------------
This story was printed from Net Express located at http://www.expressindia.com. Net Express provides a portal to India, with news from The Indian Express and The Financial Express along with sites on travel and tourism, the entertainment industry, the power sector, the environment and much more.
------------------------------------------------------------