Fiat 500 orders reach 57,000
July 24th, 2007Fiat SpA CEO Sergio Marchionne has announced that orders for the new Fiat 500 had exceeded 57,000, a mere 20 days after it’s official launch even on 4th July.
During a broad ranging conference call held after Fiat reported that second-quarter net profit more than doubled, Marchionne said Fiat has an official target of selling up to 60,000 of the new 500 model in the calendar year 2007, and sounded buoyed by the early demand for Fiat’s new baby;
We’ve had an incredible response to the 500, both in
Italy and elsewhere.
Marchionne also said the Polish plant where Fiat is making the 500 currently has capacity to produce 120,000 vehicles a year, but reiterated earlier statements from inside Fiat by saying that;
I hope that some recent efforts we’ve made to cut out bottlenecks can help raise output to about 140,000 a year.
The Fiat boss stated he was confident that operating margins for the car wouldn’t be negatively affected by ongoing wage negotiations with a labour union at the Polish plant where the baby Fiat is produced.
Acknowledging the plant’s central role in Fiat’s plans, the NSZZ Solidarnosc union is seeking a 100% increase in the basic monthly starting salary at the plant
I’m not going to comment on wage increases. We will respond to the unions. We think we have ways to mitigate any extra costs that might arise. It shouldn’t impact profitability.
Said Marchionne.
Making the car in Poland’s low labour-cost economy allows Fiat to make more profit on the car than would be possible if it were produced
It will certainly be interesting to see how Fiat manage both the wage negotiations and production capacity in the coming months. Production in particular is an interesting dilemma, we already know Fiat plan to produce soft top and Abarth versions of the new Fiat 500, with talks of a Station Wagon and/or SUV being considered too. These extra vehicles will surely generate more demand and interest, further testing Fiat’s ability to juggle supply and demand for a premium “tailored to suit” vehicle.
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July 25th, 2007 at 1:40 pm
Fiat have said in the past that they have factory facilities in Turkey to make ‘extra’ 500s if necessary, and you can be sure that Fiat will say they have exceeded their sales targets even if they have register the vehicles to themselves or sell them in bulk at a discount to car supermarkets/internet sellers/hire companies.
Only 3 weeks after launch, and French/Italian dealers who couldn’t be bothered to reply to my enquiry when I wanted to buy/import a LHD vehicle are now replying, offering to beat any other deal, a pack of freebies, in some cases they claim immediate delivery.
Fiat have said they don’t want to see them sold at a discount at their dealerships, but somehow 500s are already available via sites such as AUTO-IES at a small discount.
Let’s hope Fiat don’t stamp that out altogether: if they can seel them at a discount on the continent so quickly after launch, maybe they will do something similar in the UK next year
July 25th, 2007 at 6:34 pm
It really does depend how they want to treat the 500. They say they want it to be a premium small car, and premium and “discount” don’t sit too well together, look at the MINI as a prime example of that.
Also, a wait can be a good thing if you want to command a premium on “built to order cars”.