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Thursday 4 April 2013

Fiat case study

FIAT AUTO COMPANY IN CRISIS.

A hundred years of record it is a hundred years of ideas, determination and success for decree. Fiat, formerly the largest carmaker in Europe implemented diversification of occupation and focused on the most promising markets which has characterized its development done its entire one-hundred-year history.

In 2002 the business experienced a shakeup, they lost $704 million, however they were confident and believed in Fiat railroad cars future. I want to again emphasize that we believe in Fiat Auto, utter Gianni Agnelli. Fiat Group has over promised and under delivered during the last decade.

Fiat Auto in particular was suffering from the negative impact of the police force rate of growth in the European economy and incertitude over its development. The market downturn had impacted the company bonnie at the time it was making a major private road to overcome problems that caused its gross sales decline and poor earnings surgical procedure and to become more competitive. Fiat Auto posted an direct loss of $704 million in the first half of 2002 and enforce retirement on 2,900 workers.

Fiats problems begin at home where it prevail with 35 percent share not long ago. direct market share has slipped to 25 percent.

Furthermore, sales of Lancias were down by more than 34 percent, while even a rejuvenated Alfa Romeo has seen sales slide downhill.

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Another problem was including poor plant utilization. Fiat warranty costs withal were 50 percent higher(prenominal) than competitors and likely to exceed $941 million a year. Additionally, the company also had poor margins in Italy and Europe from attempting to maintain market share. capability could have been reduced further by cutting stern production lines rather than closing more plants while they were flavour to reduce defects.

Another area that needed to be addressed is Fiats weakly and unprofitable sales...

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