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Slowdown signs - Fiat Palio production hits hurdle

BS reported that sales of the Palio, a compact car from Italian car maker Fiat Auto have suffered as production has been halved at the company’s sole manufacturing facility in Ranjangaon, Maharashtra.

Fiat India Automobiles, a 50:50 industrial JV between Fiat Group Automobiles and TATA Motors, makes the Palio Stile, Fiat’s oldest hatchback in the country priced at INR 0.3 million.

Data available with the Society of Indian Automobile Manufacturers, the apex automobile body in the country, shows production of the Palio was 667 units during January to April compared with 1,452 units in the corresponding period last year. Sales nosedived to just 388 units in the period, compared with 1,404 units last year, a dip of 72%.

Mr Ravi Bhatia VP (commercial) of FIAPL said “Production was hurt because of the paint shop. We now have our own paint shop and hopefully the production will be restored to its original level.”

Despite the car having a petrol and diesel engine option, the Palio has failed to create much impact in the compact car segment, even though the company gave it a face lift in March 2008. Experts said strong competition from other car makers in the same segment like Maruti Suzuki, General Motors, Hyundai Motors and SkodaAuto has dented the target market.

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