After two failed attempts to get a joint venture for
vehicle production in Russia up and running, Fiat has
announced that it is instead to try to establish an
operation on its own and has just submitted plans to the
state government.
Just a
week ago Russian domestic carmaker Sollers announced
that it was jilting Fiat to sign up instead to a joint
venture with the Ford Motor Company. Ambitious plans for
the
Fiat-Sollers joint venture had been announced just over
a year ago (on February 12, 2010) which called for the
production of 500,000 vehicles in Russia by 2016. The
loans were to have been subsidised by the Russian
government. That deal in fact came after a previous plan
to acquire a stake in the country's largest automaker, Avtovaz,
fell through when the Italian firm was outbid by its
French rival, Renault.
Instead of seeking a joint venture Fiat now plans to set
up its own operation in Russia as it tries to position
itself in a quickly growing market. Production targets
have been readjusted to 300,000 vehicles a year
(although Fiat targets are generally not treated too
seriously by industry analysts) and it plans a similar
mix of models to that mooted with the Sollers joint
venture. Fiat is also keen to establish the Chrysler
Group's Jeep brand on the Russian market where it
believes its off road products will be ideally suited to
consumers' requirements.
"Fiat SpA announces that today it has submitted a
Memorandum of Intent to the Ministry of Economic
Development of the Russian Federation concerning a
project for the localisation of production and
distribution of passenger cars and commercial vehicles,"
read a statement issued by Fiat in Turin yesterday. "The project
envisages the establishment of manufacturing capacity
for up to 300,000 vehicles per year, in accordance with
the requirements of the new motor vehicles industrial
assembly regulations established by the Russian
Federation.
The product
plan would be principally based on production of C and D
segment cars, SUVs and light commercial vehicles," the
Fiat press release continued. "The
Fiat and Jeep brands will be the mainstay of this
project, which also envisages the distribution of a
limited number of imported vehicles to complete the
product range. This plan will be accompanied by a
commitment to further expand and strengthen Fiat’s
dealer network, which will also provide continuing
support and service to all of its current customers."