Fiat Group to increase India auto parts sourcing
Auto giant will buy parts for use in India production as well as exporting
Dave Hannon -- Purchasing, 9/15/2009 1:49:17 PM
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The Fiat Group's purchasing organization has announced plans to rapidly increase its sourcing of automotive parts in India next year, in part to fuel its own automotive manufacturing in India.
According to a report in Business-Standard newspaper from New Delhi, India, Gianni Coda, CEO of the Italy-based Fiat Group Purchasing, made the announcement during the 49th national conference of the Automotive Component Manufacturers Association of India.
"By next year, our purchasing office here will increase the quantum of outsourcing from India by 70% to around $1 billion," Coda said, according to news reports. "For us it is important to develop a strong supplier base here. We will invest locally and also push our global partners to start joint ventures here for our local needs and exports too."
The move is mostly aimed at supporting Fiat's expanding automotive sales in India. According to company officials, about $700 million of the $1 billion sourced would be for use in India-based production and the remainder would be for export to plants in other regions.
Since 2007, Fiat has maintained a joint venture with Tata Motors in India called Fiat India Automobiles. Its manufacturing plant in Ranjangaon is capable of producing 200,000 cars and 300,000 engines, in addition to 3,00,000 parts and accessories each year. Currently Fiat India manufactures three models at the plant, as well as several Fiat engines. The plant will also produce Tata cars in the future.
Fiat officials made no mention of how the moves would impact Chrysler. The two firms have an alliance which provide Chrysler with access to Fiat vehicle platforms, powertrain, and components to be produced at Chrysler manufacturing sites.
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