Fiat: The Turnaround Kid
July 24, 2007

It was too long ago that Fiat had been given up for nearly dead.

But today, the Italian automaker reported its second-quarter profit more than doubled (sales were higher for the 18th consecutive month), increased its share of the European car market and surpassed Volkswagen's operating margins.

Chief Executive Officer Sergio Marchionne earns the credit. He led Fiat to its first profit in five years in 2005. He changed management and products -– new compelling ones like the Grand Punto that share more components underneath.

Income rose to $819 million for the second quarter on 12-percent higher sales. For the first half of the year, Fiat sales grew 7 percent, making it the fastest-growing European car market. Fiat has increased its market share to 8.2 percent from 7.6 percent a year ago. Fiat also surpassed Volkswagen in operating margins.

Fiat’s turnaround is good news for Italy as well. The Turin-based research institute Centro Einaudi told Bloomberg News that Fiat, which includes Ferrari and Maserati, accounted for as much as 30 percent of Italy’s gross domestic product growth in 2006.

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