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Fiat to introduce Palio in India

© Sebastian Dominic

Countering the moves of Hyundai and Daewoo in India, Fiat is launching its Palio in Delhi. The launch is scheduled for October and the cars will be in the show rooms early next year. The new cars in the Indian market: Santro from Hyundai, Maitz from Daewoo, Indica from the Indian business group Tata and Palio from Fiat will be competing with the existing market leader Maruti. Maruti is a joint venture between the Government of India and Suzuki motors of Japan.

The Palio is dimensionally similar to the Indica prototypes that were shown at the Auto Expo and both these cars were designed by I.DE.A institute in Turin. Fiat is trying to familiarize customers with Palio's hatchback before launch of the Indica.

Fiat India Automobiles Ltd (FIAL), a 100-per cent subsidiary of Fiat Auto in India, will be launching the three variations of Palio. Fiat has also decided to slash price of spare parts of its Uno model that is now being produced by Ind Auto Ltd. This company is a joint venture between Fiat Auto and Premier Automobile Ltd. Fiat is absorbing the costs so that the spare parts cost of its cars is the same as its established competitors in India. The Fiat Palio range is expected to be priced competitively at the compact and mid-size car segment in India

The Fiat Palio is based on project A 178 platform which is flexible enough to create five different models. The design work for the Palio was done by I.DE.A of Italy who has helped develop the Indica for Telco. Apart from the base model which is a two-box hatchback, the same platform also churns out a three-box sedan Siena, an estate version Weekend, a mono-space van and a pick-up version.

The Palio hatchback, the Siena and the Weekend will be launched first in India. These cars will share the 1000CC four cylinder petrol and the 1700CC four cylinder diesel engine with the Fiat Uno. The Palio will be produced from the green field plant that is nearing completion at Ranjangaon near Pune. This Rs 3500 crore (Rs 100 crore = Rs 1 billion) plant is being built in the same lines as the Cordoba plant of Fiat in Argentina that produces the Palio and other Fiat products. The Ranjangaon plant will have an installed capacity of 1,00,000 units a year.

Siena is expected to have 70 per cent locally manufactured parts in the first three years. This is slated to reach 85 per cent within five years. The Ranjangoan unit comes under Fiat India Automobile Ltd (FIAL), Fiat's 100 per cent subsidiary in the country. Fiat is investing nearly $400 million in the initial stage to build its new facility at Pune.

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