Fiat Official Predicts Joint U.S., European Auto Ventures

The president of Fiat SA’s automotive unit said Monday that U.S. and European auto makers will eventually be forced to form joint ventures in Europe because of the intensity of competition there.

But Vittorio Ghidella, president of Fiat Auto SpA, ruled out the possibility of Fiat producing cars in the United States, saying it was too difficult to launch production here.

Ghidella made the comments in a meeting with auto industry analysts and reporters at the Automotive News World Congress.

Fiat sold 2 million cars last year and holds 13.8% of the European market.

Fiat and Ford Motor Co.’s Ford of Europe unit held a long and unsuccessful set of negotiations on a joint car-building venture that ended without agreement. But Ghidella said there will eventually be ties between the European units of U.S. auto makers and European companies because of the intensity of competition.

“One day or another, a certain move in that direction will take place,” said Ghidella. “American companies in Europe have to deal with the reality” of competition in Europe.

He said Fiat will not join Japanese auto makers in building cars in the United States. “I have too much to do in Europe to think about the U.S. market. I would consider it a highly risky venture.”

Fiat, which purchased Alfa Romeo last year, plans to ship the new Alfa 164 to the United States this fall for sale as a 1989 model. Ghidella said Fiat will start with projected sales of 10,000 Alfa models a year but hopes to build sales to 50,000 units annually by the early 1990s.

Ghidella said Fiat will not ship cars with the Fiat nameplate to the United States at any time in the future.

On another subject, Ghidella said the European common market nations will have to meet to decide restrictions to keep Japanese auto makers from sending so-called transplant autos built in the United States to Europe.

Some analysts think the Japanese, which are shut out of many European markets, will try to get around these restrictions by sending U.S.-built cars there. They reason the Japanese will argue that these cars are U.S.-built and do not fall under restrictions against Japanese cars.

But Ghidella rejected that argument. “We are not talking about the source, we are talking about the country of the company that builds them,” he said.