Fiat Orders in Italy Drop 40 Percent in Q1

Fiat announced a steep decline in orders on the Italian market in the first three months of this year. To be more precise, the company recorded a 40 percent drop in orders after the government incentives program ended. What's worse, the managers don’t expect April to be a better month either, on the contrary.

Sales are expected to fall between 10 and 20 percent this month as the end of the Italian scrappage programme is beginning to show its effect. Earlier this month, Italian study group Promotor said it expected the Italian market to start shrinking from April, as the orders fueled by scrappage incentives were running down.

“We are seeing a double-digit fall... of 10 to 20 percent”, said Fiat brand chief Lorenzo Sistino, quoted by Reuters, at the media launch of the Alfa Romeo Giulietta. The decline is in line with other markets such as Germany, which suffered a 26.5 percent drop in March following the end of government incentives. Sistino estimates the Italian car market will reach 1.7-1.8 million units in 2010, as compared to 2.16 million last year.

Italy’s government scrappage scheme offered EUR1,500 (USD2,000) for customers trading in an old car for a new model. The programme expired at the end of 2009 and the government has decided to discontinue it. Fiat CEO Sergio Marchionne estimated last month that the European car market could fall by 15 percent as government incentive come to an end.

March sales in Italy were up 19.6%, benefiting from orders when incentives were still in place. Alfa Romeo brand chief Harald Wester said the company aims to sell 100,000 Giuliettas a year when sales are running at full pace from 2011. Alfa Romeo sold around 110,000 vehicles worldwide last year, most of them in Europe.