It is nearly three weeks since Italian carmaker Fiat announced that it will set up dealer network in India to push sales, ending a distribution agreement with Tata Motors.

Since then, it has launched two independent dealerships one in Hyderabad followed by the Fiat Caffe brand showroom in Pune, the second after a similar one was opened in New Delhi in January.

In the city to launch Fiat Caffe, as well as a limited edition Punto 90 HP Sport, Mr Enrico Atanasio, Senior Vice-President, Commercial, Fiat India Automobiles Ltd (FIAL) and Managing Director designate for the soon to be established Fiat Group Automobile India, which will be responsible for the sale of Fiat products in the country, spoke about their plans. Excerpts:

Why this new company?

Four years ago, we started to develop dealerships with Tata. Now the stage has come where, in agreement with Tata, we have to move to the next stage of development. Our approach is to have a dedicated network of qualified dealers that will represent the best possible brand image of Fiat.

To manage this separate network, it was necessary to create a separate company fully owned by Fiat SpA.

What are your plans for network expansion?

Today, we have coverage in 126 cities through joint dealerships. Our intention is to provide service coverage. We will start from the top 35 cities, and I think 80-100 dealers will be required to cover India.

The coming months will be a transition phase, during which existing dealerships will continue to operate and progressively we will establish independent dealerships. The entire process should be completed in 12-18 months.

Your volumes last year from the Punto and Linea stood at around 18,000 units. How do you propose to grow these?

We can ignore the reference point of past volumes. That is a closed chapter and not valid in the days ahead. With increased dedication, it can be a different story. Transition will bring some confusion, but by the moment we have enough exclusive set-ups, volumes will grow progressively.

The Linea has been suffering because of some good products by the competition, but both products have done better in the first quarter of this year over the fourth quarter in 2011.

Since the restructuring, India is now in the APAC zone, and it has been decided to focus on two markets - India and China.

Fiat's earlier stint in India has dented your image. Will you invest in brand building?

You are right. We need to build credibility. But still some see us in a positive way and we need to recover some of that. My brand is not unknown… to me that is a positive.

As for brand building, this (the Fiat Caffe) is a part of that. And yes, we will invest. One area we can consider is sports activity… we will do things that are relevant to the customer.

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