Fiat Chrysler moves to prop up dealers – USA TODAY
Fiat Chrysler Automobiles presented its Fiat dealers with a plan on Wednesday designed to help them reduce the cost of running their dealerships, help to restore faith in the brand and to increase the exposure of Fiat cars to more customers.
FCA told Fiat dealers today they can consolidate the costs and operations of running Fiat dealerships with their Chrysler, Dodge, Jeep and Ram dealerships while keeping their Fiat showrooms open. Most dealers who own and operate Fiat dealerships also operate Chrysler, Dodge, Jeep and Ram nearby.
Dealers also will be allowed to display Fiat cars at those other stores, said FCA spokesman Gualberto Ranieri.
The new plan is a substantial shift in strategy for the automaker, which has painstakingly sought to carve out a separate identity for the funky, quirky Italian brand since it was reintroduced in America six years ago.
The new strategy — revealed to dealers this afternoon at a suburban Detroit hotel — could save a retailer selling 15 new Fiats a month an average of $180,000 per year in duplicate third-party vendor expenses, according to the Automotive News, which was first to report the news. FCA also plans to simplify its Fiat lineup. The automaker plans to cut the number of Fiat trim levels to limit price overlap among nameplates.
FCA reintroduced the Fiat brand at a time when gas prices were high and the demand and interest in small cars was rising. Today, the percentage of passenger cars sold in the U.S. is shrinking because consumers are flocking to crossovers and SUVs.
Last fall, Fiat launched the 500X crossover, and the company was hoping that the new vehicle would help to boost sales. But Fiat only sold 9,463 of the new crossovers in the U.S. over a six-month period.
For the year, Fiat’s U.S. dealers sold 42,410 cars, 8% less than the prior year. Meanwhile, U.S. industry sales rose 5.7% to 17.47 million — the most ever in U.S. history.There are more than 200 dealerships nationwide. On average, those dealers sold about 212 cars last year, making it difficult for Fiat dealers to earn a profit.