Fiat to expand its engine manufacturing capacity

Wednesday 31 October 2012, 12:02 PM by

The domestic arm of Italian car maker Fiat seems all prepared to deliver over 2,00,000 engines in the coming 12 to 18 months, which almost equals to four or five times the figure of cars it planned to manufacture during this tenure. Industry experts believe that its Joint Venture (JV) with Tata Motors has ended up with massive losses, which has propelled the auto maker to attain cash breakeven before the end of this period.

On this, a senior executive of the company said, “The realisations out of engines are one-fifth to one-sixth of the total cost of the overall car. And if you have five times more engines being sold than the number of cars, for sure the engines will make up the lion's share.”

Off late, its commercial activity has hived off into a National Sales Company, which has been registered as Fiat Group Automobile India Private Limited. Reportedly, the auto maker will supply around 1,00,000 diesel powertrains to the India’s leading passenger car maker Maruti Suzuki. A senior executive of the company said that it will also export few thousands of engines to Premier along with 50,000 petrol engines.

During the tenure, the auto maker is expected to produce around 14,000 Fiat models and 35,000 to 40,000 Tata cars at its Ranjangaon unit. These figures ensure that the auto maker will utilise around 40 per cent of its installed production capacity with 80 per cent usage for the manufacturing of engines.

Interestingly, the multijet engine of Fiat has been assimilated in Maruti Suzuki’s flagship models Swift as well as DZire and will be also housed in the Premier Rio.

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