Fiat’s Ranjangaon (Pune) plant with the capacity to produce 3.33 lakh engines a year, can produce a much larger volume of engines than the company and its joint venture partner Tata Motors would need in the near future. The company has decided to utilise the excess capacity to produce engines for export.
“We have the excess capacity. We will produce engines and export it to the parent company, Fiat group,” Mr Rajeev Kapoor, Chief Executive Officer, Fiat India Automobiles Ltd, said.
For Fiat, engine production in India for its global operations is cost-efficient by 15-20 per cent. Mr Kapoor said the company would use Tata Motors’ facilities to export its products. Fiat India is a 50:50 joint venture between Tata Motors and the Fiat Group.
However, the initial volume of engines to be exported is not clear yet. “The whole plan has to be worked out taking into consideration the slowdown in Europe,” said Mr Kapoor.
Fiat is currently producing 1.3 litre Multijet diesel, 1.2 litre FIRE petrol and 1.4 litre FIRE petrol engines at Ranjangaon plant. The 1.3 litre Multijet diesel, a successful engine known for its performance and efficiency, will constitute larger portion of Fiat’s export from India. Fiat group has produced more than 2.5 million units of 1.3 litre, Multijet diesel engines worldwide. Tata Motors is also sourcing this engine from Ranjangaon plant for its Indica Vista.
Between Fiat and Tata Motors, about 75000 vehicles are expected to be produced from Ranjangaon plant in 2009. The plant has the capacity to produce two lakh cars annually. Currently, Fiat’s Palio is being manufactured here. The first batch of the midsize car Linea will soon come out of the factory. The car is to be launched in mid-December.
Fiat has plans to export Linea to right-hand drive markets such as South Africa. Fiat officials said the company sold 41 units of Fiat 500, the fully imported two-door lifestyle car, in India, since its launch in July while there are 20 bookings for the car, which is priced around Rs 15 lakh.
Source: Business Line