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Fiat plans low-cost car

2007-03-15 14:56
Italian carmaker Fiat said last week it is considering whether it should develop a low-cost passenger car similar to ones made by French rival Renault SA.

Fiat Chief Executive Sergio Marchionne, who spoke to reporters at the Geneva Motor Show, said the company was considering its own low-cost version similar to the Logan, which is marketed by Renault and made for the French company by its Romanian subsidiary, Dacia.

The cars are also produced in Colombia, Iran, Morocco and Russia with plans to make them in India announced in 2006.

Even though Fiat already has its Palio, a hatchback sold mostly in emerging markets and made in several countries under joint venture agreements, Marchionne said that there was a clear demand for such an inexpensive vehicle.

"Our low-cost vehicle will be the new version of the Palio," Marchionne said.

Katsuaki Watanabe, president of Japan's Toyota, also said his company had developed its own low-cost prototype but said it was not ready to come to market because the automaker had not decided where to develop and build the model or where to sell it.

Meanwhile, Fiat's Indian joint-venture partner Tata Motors expects its ties with Fiat to strengthen, according to its chairman, Ratan Tata.

Speaking in Geneva, the executive, who also sits on Fiat's board, said, "Fiat and Tata can do many things together, working in various geographical areas and using various shared platforms."

"I'm sure we can develop our cooperation as we go along," Tata said.

  • Both Fiat and Tata sells entry-level models in South Africa. Fiat SA has an export arrangement with Fiat in Brazil, where the new Palio is manufactured. However, Fiat is still mum if the latest version of the Palio will be launched in South Africa.

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