 Will Schumacher help kick-start Fiat? |
When F1 racing driver Michael Schumacher took part in the launch of Fiat's new Panda at the Frankfurt Motor Show, he might have done his bit to save the troubled Italian car maker from extinction. Fiat Auto relies heavily on its home market in Italy where its market share fell 8.5% in a year to a historic low of 28.7% in July.
The hope now is that the car maker's latest version of its legendary Panda will once again seduce the Italian people.
"Panda will be important to us, for our market share," Gianni Coda, president of Fiat Auto's business unit Fiat Lancia and light commercial vehicles, told BBC News Online.
Improving
Since it was first launched in 1980, more than five million Pandas have been sold across Europe.
"Panda is a part of the relaunch of Fiat," Mr Coda said, noting that in the last couple of months the car maker has launched a range of new models.
And it seems to be working. In August, Fiat's market share bounced back above the 30% mark.
"We are improving our situation. When we will start to make money, we will see in the future," Mr Coda said.
Trouble
Fiat's difficulties have earned the company notoriety.
Last year it clocked up a net loss of 4.3bn euros, pushing its industrial parent Fiat group into dire straits.
And Fiat Auto's future remains uncertain.
 Fiat hopes it new Panda will seduce Italians |
On 24 January next year, an option that gives Fiat the right to sell Fiat Auto to the automotive giant General Motors kicks in. And it is far from clear whether the option will be exercised before it expires on 25 January 2009.
For General Motors, which already owns 10% of Fiat Auto, the mere existence of the option is cumbersome given Fiat Auto's current weakness.
Legal muddle
One man who is keen to step in and sort out the mess is Martin Leach, who resigned from his job as chief operating officer at Ford Europe last month.
Fiat is keen for him to take over when Fiat Auto's chief executive Giancarlo Boschetti retires next year.
But there has been a hitch.
Industry sources say Mr Leach's contract with Ford includes a clause that prevents him from working for another car maker right away.
"It seems Mr Leach's legal people gave him some bad advice," one Fiat official told BBC News Online.
Personnel matter
Within Ford, there appears to be great unease about Mr Leach's departure, which came only a year after he stepped into the top job.
 General Motors has an option to buy Fiat Europe |
The 46-year-old executive was a Ford man through and through, having spent his working life with the motor company and its subsidiaries. "I'm sad to see him go. He was a good products guy, but he has to lead his own life," Mr Leach's former boss, David Thursfield, Ford Motor Company's executive vice president, International Operations and Global Purchasing, told BBC News Online.
But when quizzed on whether Ford is trying to make life even harder for Fiat by refusing to let Mr Leach go, the response from the president and chief operating officer of Ford Motor Company, Nick Scheele, was tense.
"I really think that is something that has to remain between Martin Leach and whoever. I couldn't comment on that. I don't intend to comment on personnel matter," he said.
The contractual complications have made some industry sources question whether Mr Leach will ever arrive at Fiat as intended.
Last Friday Fiat chairman Umberto Agnelli stated that Mr Leach was certainly in the running for the job, though other possible candidates were also being considered.
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