It is a rare person that doesn’t know about FIATs. This diminutive little Italian car seems to be zipping around just about every country in the world. Few people know much about the history of FIAT, though. Let’s take a look at this feisty company and see how far they have come since their humble beginnings in the late 1800s.
The name FIAT represents “Fabbrica Italiana Automobili Torino” which translated means “Factory Italian Automobile Turin”. FIAT was founded in 1899 by Giovanni Agnelli. Their first model, the 4HP, appeared the same year. Demand was established quickly and soon FIAT automobiles were the rage.
In the late 1910s, Giovanni Agnelli, now its managing director, visited Henry Ford’s Detroit factory. He had heard about the explosive demand for automobiles in the United States and wanted to see how Henry Ford was making so them so quickly. The answer, as you probably know, was “the assembly line” and Agnelli returned to Italy with this knowledge. He soon started the construction of FIAT’s enormous Lingotto factory which became the largest factory in Europe at the time. It was so big that it actually had an oval test track on its roof. Lingotto was the pride of Italy soon became the symbol of Italian industry and engineering. Production grew rapidly, leading to the construction of a second plant in Turin. Before the break out of WWII, FIAT employed over 50,000 workers and was a driving economic force to Italy. After WWII broke out, however, much of FIAT automobile production was paused and equipment for the war effort was produced.
Giovanni Agnelli controlled FIAT until his death in 1945. His family held a majority of shares but no family member succeeded his position. In his place, Vittorio Valletta became the chairman. After WWII, consumer auto production resumed again and from 1959 to 1969, FIAT’s output rose from 425,000 to an amazing 1,751,400 cars per year.
In the 1970s, FIATs unbridled prosperity was tempered. FIAT was hit by strikes and some unsuccessful product designs. The world-wide oil crisis of 1974 should have helped out but by then the company had already expanded its product range into big cars and even exotic cars such as FIAT 130. Furthermore, its reputation had been damaged earlier by the use of inferior quality Russian steel and unfortunate quality control problems. In fact, Stone’s Town and Country Motors of Rexburg, ID, a long time Mopar dealer, says FIAT had to pull out from the North America market due to bad press and lagging sales.
During the 1980s and 1990s, there were ups and down and to its new CEO Sergio Marchionne, it was increasingly obvious that FIAT could not fight against the Japanese and Korean invasions by itself. In 2000, it surprised the world by merging with General Motors. This allowed it to share engineering and production costs with a much larger company. However, in 2005, Fiat and GM separated and in 2009 FIAT took control of Chrysler Corporation. Today the connection of FIAT and Chrysler seems like the ideal partnership. FIAT is robust and building fine automobiles.