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Fiat: the battle for the budget car market
Fiat: the battle for the budget car market

Last weekend the leader of Fiat-Chrysler group Sergio Markionne shared his plans of manufacturing budget cars under some title the company refuses to make public. He presented his speech in Torino where he claimed that he is going to launch the production of some sub brand model. The production of the new brand will be similar to that of Renault. The company has already begun to produce Dacia sub brand. So Markionne found this idea interesting.

Fiat analyzes the prospects of production of the new brand outside the European Union. Having analyzed the sales in the region, the company came to the conclusion that the launch of the manufacturing will not be profitable. Nowadays the Italian plants are not working at their full possible levels. Fiat fears that the short amounts of sales in Europe will damage the current state of events in the Fiat-Chrysler group.

Taking into consideration the following situation, the success of Dacia-property of Renault is evident. Morgan Stanley analytics have claimed that the profit of the company makes its car-producer the premium one.

Some other world companies are considering the idea of producing economy cars relevant in the current situation. For example, Nissan is planning to revive their famous Datsun brand in such countries as India, Russia, and Indonesia. Another world leader-Volkswagen- is also seeking ways to produce the budget car under their name. Volkswagen will aim at China, where the financial and economic situation is appropriate. There the German Corporation will sell their cars to the public.

Fiat has been planning to produce a new model for five years already. But the title became the reasonable problem for them. Among the possible variants there were such brand names as Innocenti, which was produces in the years 1990-1996. Markionne noticed that the major problem for Fiat is to find the best solution which will not influence the status of the company. Fiat is planning to raise its status to the premium one. And that’s why Markionne fears that in this situation there may be no vacant place for a brand-new budget car.

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