Tuesday, July 6, 2010

Chrysler to set up separate Fiat dealers



by Chris Shunk


When Fiat and Chrysler merged, it was assumed that Fiat and Chrysler-branded products would be sharing a common showroom floor. Well, you know what happens when you assume. The Detroit Bureau reports that when Fiat-badged vehicles arrive Stateside at the end of the year they will be sold in an all-new showroom bereft of any manner of Chrysler product. The news reportedly comes from none other than Fiat Chrysler CEO Sergio Marchionne, who adds that a total of 200 Fiat stores will come online in an undetermined time.

While Chrysler dealers are likely a bit upset that they won't have Fiat products to sell in their dealerships, they will reportedly get first dibs to claim one of the 200 stand-alone stores. And those dealerships must be equipped with both sales and service departments as well. The first Fiat to enter the Fiat-exclusive showroom will be the diminutive 500, which has been very well-received overseas. And more product is undoubtedly also on the way, as the 500 alone is not a big enough carrot to warrant buying a new dealership.

Opening 200 new dealerships will not be cheap, as a new full-service dealer can cost $1 million or more. There are also the costs associated with marketing a new brand in the U.S., which will likely cost well over $100 million. Since Fiat vehicles haven't been available here in States in a couple decades, the folks in Turin, Italy will likely have a lot of work to do to spread the word. Those who actually remember the Fiat brand in the U.S. market will likely need the most convincing, as horrible quality woes were a main factor in the brands failure.

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