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A Brief History of Fiat Cars

On the 11th July 1899, Fiat was founded with the signing of the company charter of "Societa Anonima Fabbrica Italiana Automobili Torino". Giovanni Agnelli, one of the original investors, seems to have stood out from the crowd with his vision and determination and as a result, two years after the first factory opened he was made managing director of the company, a position his family would hold until Mussolini was overthrown in 1945, when they were removed from leadership because of their close ties with the Mussolini government, as a consequence, the Agnelli families right to control Fiat were not returned until 1963, when Giovanni's grandson, Gianni, took over as general manager until 1966 and chairman until 1996.

The early nineteen hundreds had seen Fiat expand into many markets including trucks and aircraft engines, their core business however was in cars and the Fiat Taxi became more and more popular in Europe, further expansion introduced Fiat car models into the US, and at the time a new Fiat cost anything between 4 and 10 times the cost of a Model T Ford, making the marque a somewhat distinguished car.

Following Gianni's appointment, he undertook a major restructuring of the company reorganising production into two main groups - passenger cars being one, trucks and tractors the other - this freed up the management and as a result the company began looking to the future. Production was increased and in the late sixties Fiat overtook Volkswagen with sales of over $2 billion. Fiat's prosperity continued through the seventies with sales reaching a peak in the United States in 1979 during the Iranian oil crisis, this however proved to be short lived and within five years Fiat had withdrawn from the American market.

Acquisitions were made by Fiat during the late eighties through to the nineties including Alfa Romeo and Maserati, expanding Fiat's car portfolio that already included Ferrari and Lancia.

With market share falling Fiat introduced Paolo Fresco as chairman in 1998. Charged with getting more value for shareholders, he offered Fiat car model manufacturing workers performance related bonuses, this, however led to unrest with the unions and many thought that Fresco had been brought in to oversee the sale of the company. Although this may not have happened, it came close and after Fiat formed CNH Global by merging New Holland NV and Case Corporation in 1999 an alliance was made with General Motors in 2000, this offered the American giant an option to purchase after four years at a fair market value, if General motors failed to take up this option they would be made to pay Fiat $2 billion. Four years later the American firm chose to pay the fine and the agreement was dissolved in may 2005.

Since 2004 Fiat has come under the leadership of Sergio Marchionne and on his watch losses have fallen, mainly due to the success of the Grande Punto, although the new version of the 500 has also contributed. Joint ventures with India's Tata cars and also with a chinese manufacturer (Chery) has shown Fiat's determination to succeed in emerging markets and as ever it maintains a stranglehold on the Italian car market with over two thirds of all of its cars being sold to its domestic market.

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