Fiat Chrysler sharpens focus on South African market

Graham Eagle 
CEO of FCA South Africa
Graham Eagle CEO of FCA South Africa

fiat Chrysler Automobiles (FCA) is the seventh-largest automaker in the world. 

But before the global merger of the Fiat and Chrysler businesses in 2014, Fiat was on the brink of failure and Chrysler was on the edge of collapse. 

Nowadays it is a different story, with much of the turnaround in the group’s fortunes attributed to the late CEO of FCA, Sergio Marchionne. 

FCA’s 2018 third-quarter results show a year-on-year increase of 10 basis points in worldwide market share and a 2.7% increase in sales volumes. 

And Moody’s has recently raised its outlook on the group from positive to stable.

The Jeep brand has experienced a 67% year-on-year increase in European sales, the Fiat Panda 500 continues to dominate the region’s A-segment, and globally Alfa Romeo sales are up 7.6%.Unsurprisingly, FCA is looking to be a lot more aggressive in the South African market. 

And the company is looking to capitalise on the local market’s insatiable appetite for SUVs (currently 32%) with its line-up of Jeep models and its SUV finalist in the 2019 AutoTrader SA Car of the Year, the Alfa Romeo Stelvio.

This year, Fiat Chrysler Automobiles South Africa(FCA SA), the importers of Fiat, Alfa Romeo, Jeep, Abarth and Fiat Professional (commercial vehicles), has been restructured, new management appointed, a new sales team put in place, the dealer network optimised and a batch of new vehicles are soon to make their appearance in SA.

In May 2018, Fiat Group Automobiles SA and Chrysler SA amalgamated. 

And in August new management was appointed, chief among these the appointment of motor industry expert Graham Eagle as CEO of FCA SA. 

Eagle was enticed out of retirement following the resignation of Robin van Rensburg.Eagle says they are “fixing the basics”. 

“We are consolidating the network and consolidating the dealerships which will now handle all five of our brands.” 

Pricing of products will be more competitive, gaps in the product line-up will be filled and new engines are to be introduced, he says.

FCA SA’s advertising programme will also pick up and it is introducing a guaranteed buy-back programme on some products like its “Traction” programme on the Alfa Romeo Giulia and Stelvio. 

The company is also intent on restoring status to the Alfa brand locally, much of that lost in recent times. 

Creating a unique showroom environment for Alfa products is one of the measures FCA SA hopes will restore some of that prestige.

The Chrysler and Dodge brands are now no longer available locally, but FCA dealers will continue to service these vehicles, says Eagle.

There are currently 40-plus dealers countrywide, and new dealerships in Menlyn and Pinetown have opened their doors. 

And FCA SA’s new flagship dealership, the former “Investment Cars” dealership in Sandton, opened in November. 

Local sales have in recent years fallen from around 300 units/month to around half of that currently. 

But Eagle is upbeat about getting volumes back to monthly units of 300, believing this can be achieved “within months.” 

The target thereafter is 400 units/month.“You will see a more aggressive FCA now,” says Eagle. 

“There will be a turnaround in our sales and volumes because we have given the dealers the tools to do that.” 

This article originally appeared in the 6 December edition of finweek. Buy and download the magazine here or subscribe to our newsletter here.

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