Waiting to get into the fast lane

New Delhi, Oct. 26: Fiat India, the local unit of struggling Italian car maker Fiat Auto, plans to launch a diesel version of it’s Siena sedan powered by a 1.9-litre engine, to boost its declining sales.

The car maker, which has invested more than $500 million in India since 1997, would launch the car around the May-June period of next year, a source said.

“The company is on its schedule for the launch of the diesel variant which would be priced around Rs 5.5 lakh,” he said.

Besides the Siena, Fiat makes Palio, a compact car in the small car segment, as well as the mid-sized Adventure sedan and Uno hatchback at it’s Kurla plant in Mumbai.

Currently, the Siena is available in two variants — the lower-end version powered by a 1.2-litre engine, which costs Rs 4.4 lakh and the 1.6-litre sporting a sticker price of Rs 4.9 lakh.

The Siena competes with Hyundai’s Accent, Suzuki’s Esteem, General Motor’s Corsa, Ford’s Ikon and Indigo from Tata Motors. While the Esteem is priced at Rs 4.5 lakh, the Ikon and the 1.4-litre Corsa is priced above Rs 5 lakh and the 1.5-litre Accent costs Rs 5.65 lakh.

The car maker, which had a rough ride in the price-conscious Indian market, is banking on this new diesel variant and the recently launched Palio petrol variant, to turn the tide.

Fiat India, which supplies components to other Fiat facilities around the world, has also decided to restructure its capital thereby nullifying the effect of accumulated losses in India.

Last year, the car maker had reported 65 per cent lower losses compared with 2001. This year, it expects to sell 40,000 to 42,000 cars in 2003, up 25 to 30 per cent from the 32,111 units sold last year.

“We are receiving more enquires and also making many cars as there is a demand,” the official said, adding that on-an-average the firm produces around 1,200-1,300 units.

The current production rate ensures the company does not pile up inventory, he said.

“We are also focusing on exporting cars to markets that have “right-hand drive” where Fiat does not have a plant — mainly Southeast Asian countries, the official added.

For the six-month period (April-September), the Italian automaker has sold 5,301 units in the small-car segment in India against 16,955 units during the year ago period. It sold 569 units in the mid-size car segment against 2,110 a year earlier.