‘Zero growth’ is the prediction of Fiat’s boss Sergio Marchionne for Europe’s mainstream manufacturers between now and 2014 as Europe remains in the centre of a perfect financial storm.
Marchionne also stressed the need for economies of scale during this period, citing ‘being small, diverse and beautiful means absolutely nothing’, saying it leads to being, ‘small diverse and nonexistent’.
Chrysler’s role in the Fiat Group has also been acknowledged and it is expected that the company will soon have produced over two million cars and also add $2Bn to the Fiat Group in 2011.
Expectations are high for Chrysler and the company has expected to sell 2.4m cars in 2012 and add over $3Bn to Fiat’s coffers. Marchionne said ‘ ”I can’t imagine what would have happened to Fiat without Chrysler. “At best, it would have been severely hampered.”
Suggestions were also confirmed that the new Dodge Dart, which was launched at the Detroit Motor Show during the week would be made in China. The Dart is based on the Alfa Romeo Giulietta, which itself is aimed at the American market and produces up to 40MPG.
Fiat recently made a purchase of another 5 per cent stake in the company, taking its total percentage of shares to 58.5 per cent.
Marchionne spoke of the necessity of production in manufacturing in China, claiming that only production of this type would make finance and money in the current economic climate. “Operating leverage is the key”, he said. “You set up a project and then you run the hell out of it, making as many cars as possible out of one basic product.
Though the unpredictability of the market was central to the conference, it is predicted by Fiat that the industry has placed itself in a very positive position for medium term growth after the Euro finance problem had become resolved.
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