Sales of the Fiat Palio Stile hatchback built locally by Fiat India Automobiles (FIAPL), a 50/50 JV between Fiat Automobiles and Tata Motors, have dropped by over 70% and production has been halved at the company’s manufacturing facility in Ranjangoan, in the state of Maharashtra.

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The Palio Stile is the company’s oldest hatchback model on sale here.


Production from January to the end of April 2009 was 667 cars versus 1,452 in the same period of 2008. Just 388 units were sold in the first four months of this year, a fall of 72% year-on-year compared to the 1,404 cars sold last year.


FAIPL’s VP commercial, Ravi Bhatia, blamed the production fall on a lack of paint shop capacity.


He told just-auto: “Production was down this year due to a few shortcomings in the paint shop but they have been rectified and we hope production will be restored to what it was in the same period last year.”

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The INR345,000 (US$7,175) Palio Stile is also Fiat India’s lowest priced model and accounted for about 43% (8,087 units) of the automaker’s sales in the last financial year to 31 March, 2009. It is offered with both petrol and diesel engines.


Newer competition in the hard-fought compact car segment has also affected the ageing Fiat’s sales – the locally made Hyundai Santro and Maruti Suzuki Wagon R rivals both sold an average of 3,500 cars a month during fiscal 2008.


Other segment players now include Maruti’s Suzuki Swift (which had a six-month waiting list soon after launch), GM India’s Korean Chevrolet Aveo and VW group’s Skoda Fabia – all locally manufactured or assembled plus the new (and very cheap) all-Indian Tata Nano.


FIAPL added the Grande Punto to its range earlier this month.


Kevin Jacobs