The Siena will restart production at Córdoba in January as Fiat resumes car assembly at the plant and puts in place a strategy to built up in presence in the swiftly growing Argentinean market.

Christian Rattazzi the most senior executive of Fiat in Argentina, affirmed that the Siena’s production will start in January 2008; that decision has delayed the project to manufacture a 4x4 medium-sized pick-up in partnership with the Indian automaker Tata.

At the begining of this year, Fiat announced that will restart production of vehicles in Argentina with a range of pick ups and 4x4 utility vehicles being assembled in partnership with the Indian automaker Tata, a project which calls for a US$80 million investment. Then in May, the Italian firm once more surprised Latin American market watchers by confirming that its plant in Córdoba will start production of Siena, a medium sized sedan whose manufacturing at the factory was suspended during the financial crisis of Argentine. But the order of priorities was swiftly changed, chronologically.

"If they told me that Tata is delayed three months, I do not mind. Today, we are totally focused on the Siena’s production," Christian Rattazzi told Infobae Profesional. "The project with Tata is scheduled for the end of next year and is still in the design stage. By contrast, we are pushing on to accomplished and restart the production of the Siena," said the executive in the colloquium of IDEA that took place last week in the city of Mar del Plata. Fiat will invest US$60 million to produce 50,000 units a year of Siena model, of which 35,000 units will be exported, mainly to Brazil. "We will start production in January increase the level in February, but full capacity level will be achieved in March," added the executive. The aim is to reach 100 units daily during the third month of 2008.

Fiat opened its plant in Córdoba in December 1996, after an investment of US$600 million. In 1997, the unit produced 97,600 units split between four models: Uno, Duna, Palio and Siena. However, the Argentinean recession, which started in 1998, forced the company to gradually slow its production, until the plant stopped completely in the middle of 2002.

From a level of 95,000 units sold in 2002, the Argentinean domestic market has grown up to an estimated 550,000 units up to the end of this year; this will be a national record. This positive scenery encouraged the majority of the automakers involved in Latin America to decide to increase their levels of investments in the country, with an aggregate level of investment expected to be around US$3.5 billions by 2010, according to the local association of automakers, Adefa (Asociación de Fábricas de Automotores).

This policy, coincidently, seems to be also based on the projections made by sector analysts in the country, which estimate a total level of production of between 620,000 and 640,000 vehicles in 2008. The accessibility of credit to finance the purchase of vehicles, has also helped to promote the growth in the level of sales, and in terms of brands Fiat has the greatest percentage of sales financed, with 51.1%, followed by Renault and Chevrolet, with a 40.5 and 34.9%, respectively.

Against this backdrop Fiat decided to transfer part of Siena’s production from Brazil to Argentina, facing squarely up to the growing regional demand. This year there will be nearly 3 million cars sold in both countries. A regional focus was also an important factor for the decision of Fiat to allocate the manufacturing of its first pick-up developed in partnership with Tata to Córdoba. The annual level of production for this vehicle will be of 25,000 units, with 75% being destined for export. 

Source: Infobae Profesional