Chrysler 2008 Annual Report Download - page 72

Report on Operations Fiat Group Automobiles 71
In Western Europe, deliveries for Fiat Group Automobiles fell
8.8% to 1,237,900 units. In Italy, deliveries for the Sector
declined 16%, whereas there were significant increases in
France (+30.7%) and Germany (+14.4%), with performance
being counter to the trend in demand. In Spain (-38.7%) and
Great Britain (-8.1%), the Sector posted marked declines in line
with the downward trends in those markets.
In Poland, volumes increased 6.5% over 2007.
Despite the general contraction in volumes, the Sector’s
products performed well: the Lancia Delta and Alfa MiTo, new
models introduced during the year, achieved increasing
success; the Panda and 500 continued to hold the top two
positions in the A segment and the Punto was one of the most
sold models in Western Europe.
Outside of the European Union, Fiat Group Automobiles
strengthened its presence in well-established markets, such as
Brazil, Argentina and Turkey, while also pursuing development
opportunities in other emerging markets in collaboration with
strong local partners.
In Brazil, where the Sector delivered a total of 665,600
automobiles and light commercial vehicles, sales increased
8.6% for the year, confirming the Sector’s leading position in
this market.
Economic recovery continued in Argentina, where the
passenger vehicle market rose 6.6% over 2007, and Fiat Group
Automobiles achieved an 11.9% market share (up 0.8
percentage points). Deliveries of automobiles and light
commercial vehicles increased 15.9% to 65,600 units.
In Turkey, the automobile industry experienced declines in line
with the overall economic trend. In 2008, the market for
automobiles and light commercial vehicles was down 16.9%
over 2007 to 494,000 units. Tofas (a local joint venture in which
Fiat Group Automobiles holds a 37.9% interest) saw a 21%
decline in sales with its market share slipping to 12.4%, down
0.7 percentage points year on year.
Light commercial vehicles performed positively in 2008,
reflecting, in part, the contribution of the new Fiorino launched
in late 2007. A total of 408,700 light commercial vehicles were
delivered (+5.3%), with deliveries in Western Europe increasing
1.1% to 241,000 units. In Italy, deliveries for the Sector declined
3%, whereas growth in France (+31.2%) and Germany (+7.1%)
either surpassed or ran counter to the overall trend in demand.
In Spain (-31.1%) and Great Britain (-18.3%), the Sector posted
performance in line with the overall significant declines in
those markets.
During 2008, the Sector continued its strategy of targeted
alliances to strengthen its position in international markets.
In June, as part of the collaboration between Fiat Group and
OJSC-Sollers (formerly Severstal-Auto), an agreement was
signed for the establishment of a 50/50 joint venture between
Fiat Group Automobiles and its Russian partner for the
manufacture and distribution of Fiat brand vehicles (both cars
and light commercial vehicles) in the Russian Federation. The
joint venture’s activities are to include management of the Fiat
Linea assembly plant in the Tatarstan region. In November, a
new letter of intent was signed for further expansion of the
strategic collaboration between FGA and Sollers.
At the end of September, following the signing of a
memorandum of understanding in April, Fiat Group
Automobiles and the Serbian government announced a
definitive agreement for the creation of a joint venture to
produce cars at the Zastava plant in Kragujevac. The company
will be held 67% by FGA and 33% by the Serbian government.
Once fully operational (in 2010), the plant will have a production
capacity of some 200,000 vehicles per year, with potential for a
further 100,000 units per year. Initial investment in the project
will be approximately €700 million, which includes over €200
million in contributions from the Serbian government.