Fiat November Sales Falla Badda

MILAN December 5, 2002; Andrew Davis writing for Bloomberg reported that Fiat SpA's car sales in Italy declined for the 11th month in November and market share slipped to a record as consumers preferred models of rivals such as PSA Peugeot Citroen and Ford Motor Co.

Sales of its Fiat, Alfa Romeo and Lancia brand fell 22 percent, trimming market share to 28.2 percent from 29.2 percent the previous month, the Transport Ministry said in a release on its Web site. The decline in Fiat occurred as November sales of all manufacturers rose 1.3 percent.

"Fiat's cars just aren't as good as the competition," said Niccolo Pini, who helps manage between 600 million and 800 million euros at Banca Ifigest in Florence. He doesn't own Fiat shares. "Only the Alfa Romeo brand has been able to restructure and produce some good products.'

Fiat is facing its worst crisis in a decade amid falling car sales and losses at its auto unit. Italy's biggest manufacturer wants to cut 8,100 jobs in Italy and trim car production in a bid to return the unit to profit. Management expects Fiat Auto to lose 1.2 billion euros ($1.2 billion) this year.

Fiat shares fell 1.3 percent to 9.51 euros in Milan. The stock has declined 46 percent this year, the worst performance of any carmaker worldwide.

Sales of the Turin, Italy-based company have been hurt by tepid demand for its Stilo model, which Fiat released last year in a bid to reduce its reliance on cheaper, sub-compact cars. Fiat was forced to cut its 2002 sales target for the Stilo twice this year to 280,000 cars from the 350,000.

Ford, which makes the Focus that competes with Fiat's Stilo, increased its Italian market share to 8.9 percent in November from 8.5 percent in October. Citroen's market share rose to 5.9 percent from 5.2 percent in October, boosting Peugeot Citroen's combined market share to 12.1 percent.