This paper will provide an analysis of the Product Life Cycle of Fiat S.p.A a non-North American organization and identify one of the company’s products that have reached maturity. In addition, this paper will also accesses the public and private financial sources available for global investments of the product in the home country and foreign markets with a proposed optimal source for financing this product, and provide two foreign markets for extending the products life cycle. Product Life Cycle
A Product Life Cycle is the “period of time over which an item is developed, brought to market, and eventually removed from the market” (Investopedia, p 1).
The Product Life Cycle (PLC) is the foundation upon the biological cycle of life. •Seeds are planted (introduction)
•The seed begins to sprout (growth)
•The sprout develops leaves and roots as it becomes an adult (maturity) •After a long period as an adult the plant begins to shrink and die (decline)
The Product Life Cycle (PLC) uses the same concept as the biological cycle of life. •the product is developed and introduced to the marketplace •The product grows it gains more customers
•The market for the product stabilizes and the product is mature •The product is overtaken by competitors or loss of consumer needs and sales decline and the product is eventually taken of the market
Non-North American Organization – Fiat S.p.A.
Fiat S.p.A, (Fabbrica Italiana Automobili Torino) is on the largest companies in Europe and is best known for the manufacturing of automobiles. Fiat also manufactures airplanes, tractors, railroad stock, engine components, construction machinery, commercial vehicles, and telecommunications equipment. Fiat is also the owner of La Stampa, Italy’s leading newspaper.
In 1899, Giovanni Agnelli founded Fiat in Turin Italy. The city of Turin was developed by the existence of Fiat and their money. In 1990, almost half the population of Turin remained dependent of Fiat for their incomes.
Fiat started their automotive and engine parts manufacturing product lines in the early 20th century. With the onset of World War 1, Fiats production expanded, and Fiat became a conglomeration of many manufacturing enterprises. After the postwar years, Fiats manufacturing products became so extensive that Giovanni Agnelli thought it was time to develop his administration. In 1921, Fiats goal was to reduce their dependence of foreign suppliers by taking control of all of the manufacturing processes. Fiat started producing their own plastics, paints, and steel so they would not need to rely on other suppliers. In 1927, Giovanni Agnelli formed the Industrial Fiduciary Institute (IFI) holding company, by 1990 IFI was one of the most influential and wealthiest holding companies in Europe. Today, Fiat is still privately owned and operated by the Giovanni Agnelli heirs.
Fiat Panda Product Life Cycle Maturity
The Fiat Panda was introduced in 1980 at the Geneva Motor Show. This vehicle celebrated its 31st year in production and produced six million cars, which established it as the most widely sold city-car. The Panda was offered as a new concept car with “a new way to see the daily relationship with car: more immediate, more natural, and easier” (Autoviva, p 1).
Fiat launched a new model of the Panda in 2003, which had a more modern look, but kept the original concept. With the new launch of the Panda product from 2003 to 2009 was 1.5 million cars produced and 300,000 cars sold in 2009 alone. The Fiat Panda was rewarded the “Car of the Year Award 2004” (Autoviva, p 1). In 1983, the Panda was the first car in its range to offer eco-friendly engines. In 1986, the Panda became the first spacious compact car that featured a diesel engine. In 2004 the Panda 4x4 “became the first little off-road vehicle to have ever reached Everest’s high tech base camp at an altitude of 5.200 metres”...