Fiat puts 1.5-litre diesel engine plans on hold

Fiat has been developing a 1.5-litre diesel engine at its plant in Ranjangaon, Maharashtra. The company was expected to use it to power various models including a new SUV from Jeep. However, due to various reasons, it is reported to have put its plans on hold for the moment.

At present, Fiat supplies diesel engines to big players such as Maruti Suzuki and Tata Motors. It was expecting these companies to use this new engine to power their cars as well. However, the two companies have already started developing their own 1.5-litre diesel engines. Maruti's engine is expected to debut in 2016 and Tata's unit in 2016.

Additionally, Fiat manages to sell only about 700 cars per month. None of the company's offerings has managed to make an impact on the market. It is only because of supplying engines to other companies, that Fiat managed to turn profitable in India.

With its own sales falling and customer companies developing their own engines, Fiat is finding it difficult to justify making heavy investments in the manufacture of the engine, which is reported to be a downsized version of the 1.6-litre unit that is found in the Maruti Suzuki S-Cross.

Source: Autocar India

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