Dealers also will be able to apply Fiat’s sales numbers toward overall sales goals.
Dealers not consolidating under one code will receive a reported $1,000 monthly rent assistance.
(The Automotive News article has substantial details about the changes, and is worth the read).
Fiat still has to address plunging sales. According to the article, Fiat will begin offering generous stair step incentives to dealers along with reducing vehicle prices. Fiat also will reduce the number of trim levels that are available for the 500L and 500X in an attempt to create wider distance between the two vehicles, which have been cannibalizing sales from each other. Meanwhile, dealers shouldn’t count on the Fiat 124 Spider, due in showrooms in the next couple of months, to help much.
These are welcomed changes for Fiat dealers, who have been hammered financially after investing in a brand that has never fulfilled its promise. Many dealers have invested more than $1 million in setting up stand alone facilities for the brand.
In 2010, during a keynote presentation at an AICPA conference in Phoenix, I urged dealers to exercise caution before investing in Marchionne’s vision (I actually said, “If you’re thinking about investing in Fiat, pick up the phone and call a Smart dealer and ask them how smart they are feeling right now.”).
Historically, brands selling only small vehicles are not sustainable in the U.S. market. Even MINI has had its challenges over the years. Smart never really made a go of it and Scion this year was shut down — which in hindsight, is not a surprise. The fact is, Fiat was never going to be much more than a niche brand in this country.
Several Chrysler dealers told me after the presentation, they were intrigued by the possibility of getting their hands on the Alfa Romeo brand, which Marchionne was holding out as a carrot to persuade dealers to get on board with Fiat.