Fiat Automobiles India, the Joint Venture between Fiat and Tata Motors has inaugurated its new production facility at Ranjangaon in Pune. As well as powertrains and Tata models, the plant will see the Grande Punto and Linea joining the Palio in rolling off its lines next year.

The factory, which was built in the late 1990s and was soon mothballed due to lack of demand, faced a period of uncertainty; however the inauguration of the new facility was carried out yesterday by Maharashtra Chief Minister Vilasrao Deshmukh. Fiat and Tata have already allocated 470 of the 660 million euros they plan to invest together in India, with the remaining amount to be spread over the next five years. The Italian firm has very ambitious plans to become a major player in India within the next three years, said Fiat's manufacturing boss, Stefan Ketter, at the ceremony. "Today people can afford cars, in Mumbai alone 500 cars are registered daily," commented Deshmukh.

A new version of the Fiat Palio, known at the Palio Stile, is being introduced this week by Fiat India, arriving in the showrooms alongside the Palio Adventure. The Palio Stile will arrive on the market with a choice of two petrol engines, 1.1- and 1.6-litres. The former will come in three specification levels, SL, SLE and SLX; while the 1.6 version will pitch itself firmly at the 'sports' market, positioning itself as the only sporty option in India in its segment. The B-segment Grande Punto hatchback and the C-segment Linea 3-box sedan will both commence production at Ranjangaon during the second half of 2008.

Restarted production at Pune will be destined for both domestic and export markets. "The local manufacturing content stands at 70 percent," said Ketter at the inauguration yesterday. "We are waiting for powertrain production to begin. Once that is done, the local manufacturing content will be 100 percent. This factory, a 50:50 joint venture between Tata and Fiat, will create 4,000 direct and 20,000 indirect jobs," he added.
 

Production capacity will be in excess of 100,000 cars and 200,000 transmission units a year. Fiat Powertrain Technologies will manage production of the 1.3 Multijet 16v engine on the site and as well as being used in Fiat models it is expected to find its way into the Tata X-1 platform.

Meanwhile Ravi Kant, the Managing Director of Tata Motors was very upbeat about the rapidly-developing partnership with Fiat. "This JV is the start of a comprehensive relationship between Tata and Fiat. Tata will use this plant to produce a new generation of cars that will come out next year." The plant is “one part of the picture," he added: "We will jointly produce vehicles here, for our separate brands, for the domestic and export markets. We have one collaboration in Latin America with Fiat and we are in discussions with Iveco, for trucks.” Kant also suggested that his firm's planned Rs 1 lakh car could be sold in Latin America and possibly even in Europe through an agreement with Fiat, telling Indian reporters that "this is within the realm of possibilities," but he didn't hint which badge it would carry.