Ford and Fiat Ink Agreement on Development of New Small Cars for Europe
7 November 2005
Moving forward on the Memorandum of Understanding signed earlier this year (earlier post), Fiat Group and Ford Motor have signed a definitive agreement to co-operate on the joint development and production of vehicles in the European small car (sub-B) segment.
Fiat and Ford are already working jointly on the development of the new vehicles, a new Fiat 500 and a replacement for the current Ford Ka in Europe. The current Fiat Panda platform will be the basis for the development of the new cars, which will be manufactured in Fiat’s existing Tychy facility in Poland, where Ford engineers will contribute to the development of the models. The vehicles will use Fiat powertrains built in Poland and Italy.
The strategic cooperative agreement with Ford represents another milestone in our strategy that calls for targeted alliances aimed at sharing financial and industrial resources on new products and platforms. It is consistent with successful ventures, established with major partners including PSA Peugeot Citroën and Suzuki, and current discussions with the Indian group Tata Motors.—Sergio Marchionne, CEO of Fiat Group and Fiat Auto
Ford of Europe has amassed considerable expertise in the development of small cars, and is recognized for its class-leading driving dynamics. Fiat is the ideal partner for us in this particular project, as they are acknowledged as having been for many years one of the world’s leading manufacturers of small cars. The decision to combine forces with Fiat in this highly competitive area gives us the opportunity to minimize unit costs, while developing highly competitive products which will be true to our respective brand values.—John Fleming, Ford of Europe President and CEO
The new cars will come to market in the 2007-08 period. The projected annual volume will be around 240,000 units, divided evenly.
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