The Hindu Business Line : Fiat inaugurates new facility; rolls out Palio Stile

NEW FACILITY: (From left)The Managing Director of Tata Motors, Mr Ravi Kant; the Maharashtra Chief Minister, Mr Vilasrao Deshmukh; the Fiat India Managing Director, Mr Giovanni de Filippis; the Industries Secretary, Maharashtra Government, Mr V.K. Jairath; and the Senior Vice- President, Manufacturing, Fiat Group Automobiles, Mr Stefan Ketter, with the new Fiat Palio Stile at the Ranjangaon plant. — Paul Naronha

Pune April 2 Fiat inaugurated its Ranjanagaon facility, built in partnership with Tata Motors, and rolled out its first offering, the Palio Stile (pronounced Stee-lay) from the new plant here today. The commercial launch will be held in Mumbai on April 4.

The project, formally inaugurated by the Maharashtra Chief Minister, Mr Vilasrao Deshmukh, also involves setting up of a paint shop this November and a manufacturing facility for 2,00,000 engines and transmissions for use both in Tata as well as Fiat cars by next year. A second step for manufacture of Fiat's Grande Punto and the Linea here has been scheduled for the middle of 2008.

The project, a 50:50 joint venture between Tata Motors and the Fiat Group, involves an investment of 660 million over the next five years, with 470 million, including 250 million for the car plant, being planned for the first stage, said Mr Giovanni de Filippis, Managing Director, Fiat India Automobiles Pvt Ltd. He added that the investment to date has been Rs 300 crore. The hitherto un-named joint venture is expected to get a new name once the investment from the Tata group begins to roll in later this year.

installed capacity

The new plant will have a total installed capacity of manufacturing 1,00,000 cars annually for both domestic and export markets. In addition to Fiat models, it will produce a slew of new generation cars from Tata Motors by the middle of next year. The two companies declined to divulge details of the arrangement for sharing the production capacity, but emphasised that it would be "amicable".

The restructured Palio Stile outfitted with a 1.1 litre engine presently has 70 per cent local content, which will be enhanced significantly once the engine plant gets operational. The current production of 30 cars per day will be marketed through the present network of 63 Tata-Fiat joint dealerships.

The plan is to increase this number to 100 in the next few months in preparation for the new models that are on the anvil.

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