Fiat brand's goal: 'Bring traffic to the dealers'
Execs say products need better differentiation
The three men who run the struggling Fiat brand in North America say cheap fuel prices are only part of what's ailing the small-car marque, and that it is up to Fiat Chrysler -- not its dealers -- to fix the problem.
In interviews this month at the Detroit auto show, Fiat global brand boss Olivier Francois, Tim Kuniskis, head of Fiat in North America, and Bob Broderdorf, who runs the brand's day-to-day operations in North America, said FCA must generate more traffic in dealer showrooms. To do so, FCA is likely to focus on product marketing aimed at differentiating Fiat products from one another.
"I don't know that I need the dealers to do anything differently. The dealers do a really good job. We need to bring traffic to the dealers," said Kuniskis, who in October returned as head of Fiat in North America when he was named to a new post in charge of Fiat, Chrysler and Dodge.
Kuniskis ran Fiat in 2012, when it sold 55,600 vehicles in North America with one car, the 500 minicar. The brand's sales peaked in North America in 2014 at 58,775 with the addition of the 500L, but fell 11 percent in 2015 to 52,299, despite adding the 500X crossover to the lineup. Fiat's 2015 U.S. sales fell 8 percent from 2014 to 42,410.
This year, dealers will have four Fiats in their showrooms: 500 minicar, 500L hatchback, 500X crossover and, beginning this summer, the Fiat 124 Spider convertible that is based on the Mazda MX-5.
Kuniskis said two of Fiat's four vehicles in North America are too close to one another, causing cannibalization. But he said the 124 Spider will generate incremental sales.
"The problem is, one plus one, L and X, didn't equal two, because they're priced right on top of each other, they're contented on top of each other and they're kind of competing with each other in the showroom," Kuniskis said.
"Over time that will work
itself out. It always does. But right now, the X is kind of stealing business from the L."
Francois said, "We are just impacted, as everyone in this small [car] segment," by low fuel prices. He said Fiat's message must focus on the 500X crossover and educate consumers that the X is not a minicar.
"It's taking a little bit more time to understand that the X is not the little 500," he said. "It's a bigger 500; it's more powerful, it's more capable, it's more family-friendly."
Broderdorf said substitution continues to plague the brand with the introduction of the X, just as it did initially when the brand launched the 500L.
The 500X "has pulled people from everywhere in Fiat that were interested. It's pulled people from 500, it's pulled people from L," Broderdorf explained. "The dealers have been excited. They're pushing X. They've been asking for this."