Confidence is the fuel

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Interview | Nagesh Basavanhalli, president and managing director, Fiat Group Automobiles

Talk about automobile engineering and technology, Fiat's name figures among the best in the world. However, when Fiat in India joined hands with Tata Motors for sales and service, the arrangement did not work too well. After considering its options for a while, Fiat decided to strike out on its own and establish an exclusive network. In just about 15 months, it has set up well over 100 dealerships across the country. It has also turned aggressive in terms of new product launches to drive on its much-needed growth path. Nagesh Basavanhalli, president and managing director, Fiat Group Automobiles India took shared with the Financial Chronicle, the company’s growth road map.

There seems to be a new-found air of confidence around whatever Fiat in India. What is behind this new spirit?

We really believe in our three-pillar strategy — which is to establish an exclusive network, line up new products and brand building. The plan was to establish an exclusive sales and service network that will help us to cover key markets across regions. Today, we have 116 exclusive dealerships in 93 cities across 23 states, which provide world-class service to our customers. We also focused on spare parts availability and its affordability. We also had planned to launch four new products across segments and we are halfway through the process, having already launched the new Linea and now the Punto Evo. We have lined up all the right products and these will be launched, more or less in time for the festive season.

And let's not forget the customers, who are a strong pillar for our business. The negative sentiment around us is reducing and customers are coming back to the family. This gives us the confidence that the strategy is working. As a result, we are confident of positioning Fiat as a global premium brand in terms of technology, backed by the exclusive sales and service network.

Why did it took so long for Fiat to break free and establish its own sales and service network?

I do not want to talk about the past. We cannot change the past and hence no purpose is served in deliberating over it. But when we moved ahead to establish our own exclusive sales and service network, we prevailed upon the dealer partners to stock enough spare parts, especially those that are most frequently needed. We are backing them with our large warehouse, over about 60,000 sq ft, established at Chakan in Maharashtra. Dealers can source these parts at the earliest. That has given a big confidence push.

We also backed up our dealer partners with training for their personnel. We give the training for service technicians under global standards. Further, any customer complaint, through any medium —whether in person, over phone or mail, is given utmost care. We track it all every day. I personally see and monitor the most critical complaints and work to resolve the complaint within a certain timeframe, depending on the nature of the complaint.

We have been also monitoring the repair order load at the service level. Last month, it was the highest at well over 22,000. This means people are coming back to us. There are over two lakh Fiat cars, both old and the recent ones, plying on Indian roads. Several of these car owners were earlier going to others for repairs. These vehicles are coming back to us for service to our exclusive dealerships. We are happy to welcome them back into our fold. This also gives us an opportunity to showcase our newly launched cars to these customers and thus help them upgrade.

To sum it up, we have established the infrastructure, we offer world class training and make spare parts both available and affordable. As I had mentioned earlier, we cannot change the past and we are today focused on building the brand as world class as it is known around the globe.

From the recently revamped Linea and now the Punto Evo, there seems to be an aggressive move to not only revamp existing products, but also to recreate a new brand image for the company. Can you elaborate on the thoughts behind the move?

As per our plan to launch four new models, we have already launched the Linea and now the Punto Evo. Next will be the Avventura followed by the Abarth before December this year. These products will cater to the B+ (Punto Evo), entry level C – segment (Linea Classic) and ‘C+’ - Linea. While Avventura will be targeting the compact SUV market with the likes of Ford EcoSport, the Abarth will be a product targeted at enthusiasm and performance lovers.

In fact, the number of new launches that Fiat seems to be planning — five by this December and nine by the end of next year — seems a bit like going overboard, especially in a market that is yet to show true colours of recovery and witnessing a slew of new launches from all other players.

We believe we have established the required infrastructure and have backed it up with the right mix of products. The perceptions will differ from person to person. For some, it may seem like going overboard, while someone else may feel it is not enough. As far as we are concerned, we had drawn a clear strategy and strongly feel it is working. Based on that confidence, we believe the products lined up for the Indian market are right.

A vastly spread sales and service network is the key to success of automobile products and launches. And Fiat’s dealership network at about 116 is comparatively small when compared to others. Can you elaborate on the plans on this front to match up to the might of the others on the field?

To answer this, let us just look back at the time when we decided go our way and establish our own exclusive chain of sales and service network. Overnight, from 180-strong network, when we were with Tata Motors, we came down to zero. Starting from scratch, today we have 116 dealers, all established in a short period of time. We will keep expanding that base, depending on market needs as and when the volumes and customer base increase.

Within the existing network, our dealers have fine-tuned a strategy to cover a larger area, including neighbouring towns. For instance, a dealer in Chennai manages customers up to Vellore. They take care of service requirements of customers in areas where the engineers could reach in about two hours of travel. In addition, they conduct service camps at periodic intervals, including weekly camps, in select towns to take care of customer needs at their doorsteps.

The Indian market is keenly looking forward to the proposed launch of the Jeep brand, including the popular Wrangler and Cherokee. How long does the market have to wait for the same?

Jeep is a globally acclaimed and very aspirational brand. As part of our initial strategy, we did work a plan to launch the model in India. However, early this year, due to the prevailing domestic market conditions in the country, we decided to postpone the plan. We may take a call on fresh launch plans by the end of the festive season this year.

govardand@mydigitalfc.com

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