The document provides an overview of Fiat Group S.p.A., including its history, current market position, brands, vehicles, marketing environment, competitors, and 3-year sales forecast for the US market. Key points are that Fiat is Italy's largest automaker and 6th largest worldwide, with brands like Fiat, Alfa Romeo, Ferrari, and Maserati. The marketing plan discusses target markets, pricing strategies, and marketing communications for new models like the Fiat Linea entering the US. Projected sales have Fiat unit volume reaching 450,000 and $6.8 billion in sales by 2015.

1. THE RETURN TO AMERICA Marketing 301 Rutgers Business School Professor Grant W. Hunter By Daniel Esposito, Brian Staples, Kerine McIntosh

3. About F.I.A.T. Group S.p.A Fabbrica Italiana Automobili Torino Italian Automobile Factory of Turin Founded in 1899 in Italy Italy’s largest carmaker 6 th largest carmaker worldwide - Including Chrysler -4.5 million units in yearly sales worldwide (Bloomberg.com)

5. Fiat Common Stock

6. Marketing Environment What happened last 12 months What expect next 12 months Impact on Product S ocial/Cultural/Demographic -Environmental Awareness -Change in mode of transportation -Continued environmental awareness -Continued use of alternative transportation -Positive -Consumers are less inclined to purchase large vehicles T echnological -Hybrid technology and fuel efficiency are improving -Continued improvement -EV Cars -Positive -Fiat cars are ahead of the curve

7. Market Environment (cont’d) E conomic -Rise of gas prices -Recession/ financial crisis -Bankruptcy of Chrysler/ GM -Rising Unemployment -Continued volatility in oil prices. -Positive -Consumers will downsize -More fuel efficient cars demanded P olitical/Legal/ Regulatory -CAFE standards are raised -Government bail out on car industry Government ownership in GM -Positive - Vehicles will be expected to uphold the new CAFE standards C ompetitive -Zip cars -Bikes -Electric Startups Plug in Electric Electric Startups -Challenge What happened last 12 months What expect next 12 months Impact on Product

8. Oil Prices Alexi Miller, GazProm Chairman, on $250 oil: "This forecast has not become reality yet, given that the [credit] crisis gained momentum and exerted a powerful impact on the global energy market. But does this mean that our forecast was unrealistic? Not at all."

9. Effect of Oil Prices on Consumer "With the (fuel) prices being high in the United States, we're seeing exactly what happened in Europe a number of years ago," Ford CEO Alan Mulally told Automotive News. "Customers are going to make economic decisions, and they're going to move toward smaller and medium-sized vehicles." “ “ The dramatic increase in car sales appears to be one of the most profound shifts in automotive buying patterns in more than a decade," Dick Colliver, executive vice president of American Honda, said in a statement. "Record sales of the Honda Civic clearly demonstrate an accelerated trend toward fuel efficiency."

10. The American Automobile Market 2006, 7,667,066 units sold (passenger vehicles) 2004, Average Sticker Price $29,476 2004, Average MPG was 17.1 1960, Average MPG was 12.4 2003, American Population was 291 mil. 2003, 193 mil. Drivers 2006, 250,851,833 Passenger Vehicles (Department of Transportation)

11. Players in the American Automobile Market outside F.I.A.T Mass Market Luxury: -BMW -Mercedes-Benz -Infiniti -Acura -Mercury -Lincoln -Lexus -Jaguar -Cadillac -Audi -Price: $25,000 to $70,000 Selective Luxury: -Aston Martin -Porsche -Rolls Royce -Bentley -Lamborghini -Bugatti -Price: $50,000 + Mass Market: -Ford -GM -Mazda -Mitsubishi -Nissan -Toyota -Hyundai -Kia -Suzuki -Hyundai -Isuzu -VW -Mini -Honda -Subaru -Price: $10,000 to $35,000

13. Fiat Market Share Italian Market: 2008, Market Share reached 31.9% (+0.6%) Western European Market: 2008, Market Share reached 8.2% (0.2%) Western European Market consists of Italy, Benelux, France, Switzerland, UK, Ireland, Germany, Spain, Portugal Fiat Brand: 2008, Market Share in Western Europe Reached 6.6% (+0.4%) 2008, Market Share in Italy reached 25.1% (+0.9%) 2008, Market Leader in Brazil in passenger cars with a 24.9% market share

14. Financial Stability Fiat Group: Fiat Group Revenues totaled €59.4 billion ($82.6 Billion) Operating Income: €3,362 million ($4.6 Billion) Operating Margin expanded to 5.7% from 5.5% Profit before taxes: €2,187 million for 200 8 ($3.04 Billion) Net Income: €1,721 million for 2008 ($2.4 Billion) Fiat Group Automobiles (Fiat, Alfa Romeo, Lancia) Operating Income: €691 million ($972 Million) Maserati Operating Income: €72 million ($101 Million) Ferrari Operating Income: €339 Million ($477 Million) Case New Holland Operating Income: €1,122 million ($1.58 Billion) Iveco Operating Income: €838 million ($1.18 Billion)

15. Potential Achilles Heels of Fiat Population not being able to use manual transmission Population not liking smaller engines “ Fix It Again Tony” Outside decks of ships, exposed to sea salt and seawater, dealers wouldn’t wash undercarriages Poor U.S. dealership, didn’t follow recommended services Steel issues

16. External Threats Competitors within each class and model Electric Startups such as Tesla Motors

17. Areas Fiat and Alfa Romeo Must Successfully Target for Opportunity Need for reliable, fuel efficient vehicles Should go after Saturn and Pontiac owners

18. What Value does Fiat bring? Any American driver that is seeking a better driving experience will turn to the Fiat Group. Unlike other car companies we will provide cars with fresh styling, that are fuel efficient, reliable, fun to drive and are backed by a viable corporation. F un to drive I nexpensive to maintain A ble for anything T rusted Technology

19. What Sets Fiat Apart Dealer and Distribution Network Chrysler, Dodge, Jeep, Ferrari, Maserati Corporate Viability Profitable amongst all automobile segments Founded in 1899 Blue and Me Windows Mobile powered integrated electronics system (ie. Microsoft Sync in US Market) Pur O2 & Multiair Both make Fiat cars more fuel efficient and environmentally friendly Magneti Marelli - Supplier, Automotive Lighting, Electronic Systems, Powertrain, Suspension Systems, Exhaust Systems, Aftermarket Parts and Services, Motorsport, Plastic Components and Modules Case New Holland Excess Manufacturing Capacity Italian Factories Excess Manufacturing Capacity

20. Market Segment by Car Type Sedan Luxury Sedan Sportswagon Crossover/Compact SUV Compact Subcompact Convertible Sports Convertible MPV/Van

21. Market Research Plan Primary Analyzing the sales of Fiat Group vehicles in existing markets Secondary Analyzing the sales of comparable vehicles in existing markets and in North American market Analyzing reviews of vehicles from various information sources and industry reports

22. Market Segment by Brand Fiat Automobile Group Fiat Middle Class, Mass Market Alfa Romeo Middle Class, Mass Market Luxury Ferrari and Maserati Selective Luxury Automobile Market Case New Holland Tractors, Agricultural Equipment, Backhoes Iveco Commercial Trucks, Tractor Trailers, Fire trucks, Industrial Trucks

23. Pricing Strategy by Brand Fiat Penetration Pricing, Target Pricing, and Loss-Leader Pricing Alfa Romeo Skimming Pricing  Target Pricing w/ Premium Maserati Prestige Pricing Ferrari Prestige Pricing Case New Holland Bundle Pricing, Target Return-on- Sales Pricing Iveco Bundle Pricing, Target Return-on-Sales Pricing

25. Fiat Linea Price: 622,640 Indian Rupees to 844,504 Indian Rupees Price: $12,966 to $17,587 Price: $14,500 in America Engine: 1.4-litre 4cyl turbo, 90bhp 0-62mph: 13.8 seconds Top speed: 105mph Transmission: Five-speed manual, front-wheel drive Economy: City:30 MPG Highway: 45MPG CO2: 129g/km Standard Equipment: Climate control, electric windows, alloy wheels, six airbags, trip computer, remote central locking Targeted Market/Consumers: First Time Car Buyers, Middle Class Families with Household Income $50,000+ Expected Sales Per Year: 2013: 120,000 (10,000) $1.8 Billion 2014: 180,000 (15,000) $2.7 Billion 2015: 240,000 (20,000) $3.6 Billion

26. Competition for Linea

27. Linea

28. Linea

29. Fiat Sedici (16) Price: £10,505- £ 16,205 Price: $15,939 - $19,639 in America Engine: 1.6-litre 4cyl turbo, 107bhp 0-62mph: 10.8 seconds Top speed: 106mph Transmission: Five-speed automatic, Economy: City: 28, Highway:35 CO2: 159g/km Targeted Market/Consumers: Young First Time Car Buyers Middle Class Families Expected Sales Per Year: 2013: 24,000 (2,000) $384 Million 2014: 36,000 (3,000) $576 Million 2015: 54,000 (4,500) $864 Million

30. Competition for the 16

31. Fiat Qubo Price :£9,750 t0 £12,350 Price: $16,200 to $20,500 Price: $14,500 in America Engine: 1.3-litre 4cyl, 75bhp 0-62mph: 16.5 seconds Top speed: 96mph Transmission: Five-speed manual, front-wheel drive Economy: City:40 MPG Highway: 50MPG CO2: 119g/km Standard Equipment: Air-con, trip computer, adjustable steering, electric mirrors, ABS and EBD Targeted Market/Consumers: First Time Consumers, Middle Class Families, Outdoorsy Consumers Expected Sales Per Year: 2013: 30,000 (2,500) $384 Million 2014: 48,000 (4,000) $786 Million 2015: 72,000 (6,000) $1.15 Billion

32. Competition for the Qubo

33. Fiat 500 and Alfa Romeo MiTo

34. Fiat 500 Price of £9,505 - £13,605 Price of $13253-$22,472 Price of $14,000 in America Engine: 1.2-litre 4cyl, bhp 0-60mph:9.3seconds Transmission:6 speed manual Economy: City:42 MPG, Highway: 59 mpg CO2:119g/km ***** EURO NCAP RATING Standard Equipment:Electric power steering, ABS, 7 Airbags Total (Curtain Side), and Blue and Me all standard Available in Cabriolet and Electric Versions Targeted Market/Consumers: First Time Car Buyer, Urban/Suburban Commuter, Middle Class Family with Income of $50,000+ Expected Sales/Year: 2013: 48,000 (4,000) $672 Million 2014: 60,000 (5,000) $840 Million 2015: 84,000 (7,000) $1.18 Billion

35. Competition for the 500

37. Price: £10,995 to £14,995 Price: $18,200 to $24,800 Price: ~$20,000 in America Engine: 1.6-litre 4cyl turbo, 120bhp 0-62mph: 9.9 seconds Top speed: 123mph Transmission: Five-speed manual Economy: City:35 MPG Highway: 45MPG CO2: 129g/km Standard Equipment: Leather steering wheel and gearknob, DNA and Q2 systems, 16-inch alloys, carbon fibre-effect dashboard Targeted Market/Consumers: First Time Car Buyer, Young Urban Professional, Income $80,000+ Expected Sales Per Year:2013: 24,000 (2,000) $480 Million 2014: 48,000 (4,000) $960 Million 2015: 60,000 (5,000) $1.44 Billion

38. Competition for the MiTo

39. Alfa Romeo Spider Price: £25,995- £32,700 Price: $42 938.541-$54013.86 Price: $52,800 in America Engine: 3.2 L JTS V6 0-62mph: 7.1 seconds Top speed: 152mph Economy: City: 15 MPG Highway: 30 CO2: 272g/km Standard equipment: Dual-zone air-con, electric hood, five airbags, CD player, lockable rear storage cubbies, leather steering wheel and gearknob, rear parking sensor, cruise control, 17-inch alloys Targeted Market/Consumer: Household with Annual Income of $150,000+ Expected Sales/Year:2013: 1200 (100) $63.6 Million 2014: 1800 (150) $95.4 Million 2015: 2400 (200) $127.2 Million

42. Competition for the Spider

43. Alfa Romeo 159

44. Price:£18,500 to £29,250 Price:$30,580 to $ $48,350 Price: $40,500 in America Engine: 3.2 L JTS V6 0-62mph: 13.8 seconds Top speed: 155mph Transmission: Five-speed manual, front-wheel drive Economy: City:17 MPG Highway: 32 MPG CO2: 260g/km Standard Equipment: Targeted Market/Consumers: Middle Class Family with Household Income Over $125,000 Expected Sales Per Year: 2013: 12,000 (800) $492 Million 2014: 14,400 (1200) $590 Million 2015: 24,000 (2000) $984 Million The 159

45. Competition for the 159

46. Place Fiat Vehicles can be found in various Chrysler dealerships across the United States. Dealership hours across the country will generally be Sunday through Saturday, 9 am to 5 pm. Can make appointments from 7 am to 9 am and 5 pm to 9 pm In large markets (ie. LA, NY, Chicago) regular hours are likely to be extended later into the evening

47. Demand Capacity Management From Supplier To Producer Components of Fiat vehicles will be made on demand From producers to dealerships As cars are made they are given to dealerships based on expected performance From dealerships to consumers Cars will be readily available for consumers to drive off the lot

48. Channel Strategy Suppliers Magneti Marelli and Chrysler affiliated suppliers such as Mopar Provide components for cars Producers - Fiat Produce cars and provide dealer/consumer financing Reach agreements on price and terms Retailers - Chrysler dealerships Gather information Develop and disseminate persuasive communications Provide for storage Assume risks Acquire funds to finance inventories Provide for buyers’ payment of their bills Oversee actual transfer of ownership Consumers

49. actually, you CAN afford ITALIAN style Fiat, a Fiat Group Company: as shown $17,500 The all new linea

50. Marketing Communications Plan Communications Platforms Ads Events (Car Shows) Sweepstakes/ Car giveaway Communications Objectives (Category need, Brand awareness, Brand attitude, Purchase intention) Creative strategy create emotional appeal to environmentally conscious individuals (Pur 02) create emotional appeal to those who have watched the graduate (Alfa Romeo Spider)

51. Marketing Communications Plan (cont’d) Message source- environmentally conscious icons like Al Gore, Brad Pitt, Hayden Panettiere Personal communication channels- word of mouth for consumers. (referrals can used during purchase to obtain a rebate) Nonpersonal communication channels – blogs, facebook, industry review sites, vehicle websites. style”

53. Product Placement and Promotion Strategy Product Placement and Promotion Strategy: Leverage Ferrari and Maserati without diluting NASCAR Team (Fiat-Dodge) or (Fiat) Toys (Barbie, Bratz Dolls, Hot Wheels) Play up movies (James Bond, and The Graduate) Opinion Leaders: Leonardo DiCaprio etc.

57. 2009 Outlook for Fiat Group • Global demand for our products will decline approximately 20% compared to 2008. • Income from operations for the group will be above €1 billion. • Net income for the Group will be above €300 million.

58. 3 Year Sales Forecast For Fiat Group Automobiles in America: Fiat 2013: Unit Volume:222,000 (2.34%) Sales: $3.24 Billion 2014: Unit Volume:324,000 (3.41%) Sales: $4.90 Billion 2015: Unit Volume:450,000 (4.74%) Sales: $6.80 Billion Total After Three Years: Unit Volume:996,000 Sales: $14.94 Billion Alfa Romeo 2013: Unit Volume:37,200 (.39%) Sales: $1.04 Billion 2014: Unit Volume:64,200 (.68%) Sales: $1.65 Billion 2015: Unit Volume:86,400 (.91%) Sales:$2.55 Billion Total After Three Years: Unit Volume:187,800 Sales:$5.24 Billion 2015: Fiat-Chrysler Market Share: 14.15% (American Market) 2015: 5.2 Million in Sales (Minimum Worldwide)

59. Sources: www.autoexpress.co.uk www.autos.aol.com www.italiaspeed.com www.fiat.in www.autoblog.com www.wsj.com www.autobloggreen.com www.edmunds.com www.usnews.com www.fiat.com

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