Introduction America, a nation which when it comes to cars has historically sided on the bigger is better side of the spectrum is being invaded by smaller, more economically conscious vehicles. Fiat has been manufacturing smaller for years, overseas in Europe, Brazil and even China. With the acquisition of the American made Automotive company Chrysler in 2009, Fiat has launch a marketing campaign to finally gain a hold in the American market. Is America ready for “Every Once in a while, something comes along so powerful in concept, so revolutionary in design, it redefines a generation – America, get ready for the one and only FIAT 500.
Despite the American notion of fast muscle machines, there is a growing demand for the economically conscious vehicles. Rising cost for fuel and more demanding regulations for emissions will likely increase demand for the types of vehicles FAIT is providing and the new, leaner Chrysler is producing. The wave of hybrid models and fully electric vehicles already in FIAT”s stables may give FIAT the leverage it is seeking and hoping on, in the American market. Fabbrica Italianna Automobili Torino FIAT, was founded in Italy by a group of investors in 1899, most noticeably Giovanni Agenlli.
The company was created as a automobile factory. By 1910, Fiat was Italy’s largest automotive company, and the company has retained this status since. This was the same year that FIAT built its first plant in Poughkeepsie NY, though it lasted less than a decade. This wasn’t the last attempt FIAT made to venture into the American. Fiat’s Environment General Environment FIAT competes in over 80 countries and has distinguished itself as a automotive company capable of innovation. Though FIAT has created trucks and larger cars, the company has distinguished itself as a manufacturer of small customizable vehicles.
Originally FIAT’s general environment was Italy’s demographics, economical, political/legal, social and culture, but that was over a century ago and FIAT has become a world corporation, with ties in many nations. FIAT has built a global distribution network which has now incorporated Chrysler into the fold. With the addition of Chrysler and FIAT renewed launch of its smaller, Eco-friendly vehicles into the American automotive industry. In the American general environment, FIAT has to contend with customers who are used to purchasing bulky sized vehicles.
Where economically vehicles were once seen as a joke. America’s legalities may promote the purchasing of vehicles like the FIAT 500 for its emissions but the American culture and social mind set craves the fast and the furious not the compact and comfy. Industry Environment Though FIAT is a world class competitor in the automotive industry, America is a world in-of-itself. To FIAT’s advantage, American have come to embrace foreign vehicles with enthusiasm. The German made BMW and Porsche are considered luxury cars to most Americans.
FIAT is aiming to replace not the luxurious but the common car. The common car in America are Nissan, Ford, Honda and Toyota. There is a large difference between what FIAT is offering versus what they are offering. But with the economical direction the world is heading leaner is better, FIAT may be able to find a viable market in America. Competitor Environment America is one of the few nations that values bulky vehicles even in urban areas where trucks should be considered to cumbersome to navigate through smaller, congested streets.
Though this is changing, with high gas prices and more stringent emission regulations. FIAT is waltzing into an American automotive industry that trying to adapt to the need of its customers. American’s like the rest of the world don’t want to be held at gun point by the gasoline industry any longer. Which a movement for hybrid, electric and diesel vehicles is on the rise. Automotive company’s such as Nissan, Ford, Acura, Audi, BMW and Honda are striving to fill that demand. They are making fuel friendly engines/cars that are just as bulky as their older counter parts.
There are few vehicles in the American automotive industry that will compete with FIAT’s vehicles smaller stature. The Mini-Cooper and the beetle are two competitors, though upon closer inspection, FIAT beats them in price, and fuel efficiency. Expansion into the USA For the sake of success in the USA, FIAT must diversify in its methods as well as in its models. So far, with the acquisition of Chrysler, FIAT has given itself the potential to remodel Chrysler’s cars into sleek smaller, more Eco-friendly versions. FIAT needs to come up with different styles for its models.
Its current 500 models look strikingly like its older models. FIAT must also understand its audience. Where would demand for a smaller, vehicle be more prominent. That would be cities such as New York, Washington DC and LA. FIAT”s smaller models will not appeal to family’s or those living in rural areas. It would be best for FIAT to target young business persons and to continue to absorb smaller automotive businesses to acquire their assets. The FIAT compact car is a step in the right direction in terms of gaining more exposure to the family vehicle segment of the industry.
Both Chrysler and FIAT have aces up their sleeves which must be used carefully. Chrysler is developing the Petrol engine, called Pentastar and FIAT’s MultiAir engine according to Giuseppe Calabrese, can provide FIAT-Chrysler an edge. Unfortunately they are unproven and with the US government tightening the reigns on emissions it is uncertain if they will hold up to the standard of 2017 and beyond. Closing Fiat-Chrysler has the capability to become a contender in an America which is tired of paying high gas prices, in an America who’s government is enforcing harsher emission regulations.
The company needs to broaden it’s model selections. American’s appreciate choice and sticking models that resemble so closely to each other will only hurt the company. Resources: Calabrese, Giuseppe. (2013). Toward a new carmaker:Fiat-Chrysler. Retrieve from http://revel. unice. fr/eriep/? id=3375 Hitt, M. (2010). Strategic Management: Concepts and Cases: Competitiveness and Globalization (9th ed). Cengage Learning. Retrieved from http://digitalbookshelf. southuniversity. edu/books/1111505187/id/fig4_1 Fiat. com. (2013). News. Retrieved from. http://www.
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