Dealers Say Fiat Setting Low Price For New Small Car

MILAN July 14, 2003; Christopher Emsden, writing for Dow Jones Newswires reported that Fiat SpA is bidding to grab back market share by selling its new small car, the Gingo, for as little as EUR7,950, dealers who have been given the price list said.

Fiat is cutting back on standard equipment - an air bag for the front passenger seat is an optional for the cheapest model - to keep prices for the Gingo down and in line with Asian subcompacts such as Daweoo's Matiz, Hyundai's Atos and Suzuki's Atos.

That marks a change from the strategy Fiat used with its last major new model launch, the Stilo, sales of which have steadily grown since 2001 but remain well below the company's original forecasts. Fiat loaded up the Stilo - which pushed into sedan territory - with gadgets that pushed up the price even though consumers weren't always wowed.

The EUR8,700 Gingo variant, dubbed "Active", offers power steering, while versions with skyrooves, air conditioning and stereos all go for less than EUR10,000.

At that price, the five-door Gingo competes with slightly-larger three-door rivals such as Ford Motor Co.'s Ka and Renault's Twingo, as well as the Agila made by General Motors Corp.s' German unit Opel.

"Those prices are certainly competitive," said Gabriele Gambarova, an analyst at Rasbank who follows Fiat.

A spokesman for Fiat Auto said a formal price list will be made available when the car is launched commercially in the autumn and declined to comment on what dealers said.

Customers can buy the Gingo, which replaces Fiat's longtime mass seller the Panda, as of mid-September, but Fiat is already taking offers from dealers.

Fiat's share of the Italian market fell in June to 27%. The company's latest plan, unveiled late last month by new Chief Executive Giuseppe Morchio, foresees boosting that to 32.4% by 2006.