Fiat India Automobile is planning to source a far greater number of auto components from Indian ancillaries by the year 2010. The company wants to increase component outsourcing from India by 70 per cent, to approximately $1 billion. The announcement was made by the CEO of Fiat Group Purchasing, Mr Gianni Coda, at the 49th national conference of Automotive Component Association of India, held last week.

The Fiat Group sources components for its passenger cars, farm equipment, construction equipment and truck business, from India. These fulfil only 5 per cent of its global business requirements. Fiat now wants to increase its total outsourcing from India by at least 70 per cent, a large part of which will be used solely for Fiat’s operations in India itself.

The company’s decision comes in the light of the success of its new models like the Linea and the Grande Punto, which will come with a higher percentage of localized components. Also, the country’s infrastructure segment has revived over the past few months, pushing up demand for construction equipment. Additionally, some global markets are also seeing a rise in auto sales. All these factors have led Fiat to increase outsourcing from India, which is a ‘good destination on quality cost parameters’.

Courtesy: www.driveinside.com