Tata-Fiat alliance has run into troubled waters with Tata group chairman Ratan Tata stating the need to critically examine their joint venture.
The four year old joint venture between the Italian carmaker Fiat and Tata Motors is still struggling to achieve break even and had reported a loss of Rs. 260 crore in 2009-2010, even though Fiat cars are being received positively in the market due to their pricing and features.
In an interview with JD Power, Ratan Tata stated that the Tata-Fiat joint venture has been less active than expected. Analysts believe that in the wake of growing competition from global auto giants, Fiat needs to bring in new models into India and thereby increase its product offering for the Indian market.
Tata Motors has squashed all rumors of the two companies parting ways and a company spokesperson in response to an email query clarified that Tata Motors holds the alliance in great esteem by acknowledging the crucial role Fiat engines played in enhancing the performance and growth of the brands (Tata Indica Vista and Tata Indigo Manza) of the second generation Tata car platform.