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Carnation-Fiat ink deal



Carnation Auto, the multi-brand car service provider promoted by former Maruti Suzuki head Jagdish Khattar, today joined hands with Fiat Group firm Magneti Marelli for servicing premium cars in the country.

Along with Carnation Auto, the 5.4 billion euro Magneti Marelli will also foray into India's spare parts aftermarket by selling and distributing co-branded auto components.

"So far we have been servicing only entry level cars. By tying up with Magneti Marelli, we will now start premium car services for cars costing Rs 10 lakh and above," Carnation Auto Chairman and Managing Director Jagdish Khattar told PTI.

He said in the initial phase, the two partners will run a pilot programme in Gurgaon and depending on customer response, in a year's time they could expand it further to cities like Mumbai and Bangalore.

"The association will help us enhance our technical know -how and spare parts offerings, while Magneti Marelli will gain market insights from Carnation," Khattar added.

When asked about Carnation Auto's announced plans to launch its own branded auto parts, Khattar said: "The parts that we are going to sell in the aftermarket with Magneti Marelli will be jointly branded. We will source it from them as well as other independent domestic and global producers."

Magneti Marelli's aftermarket division has over 30,000 spare parts across 30 product lines.

The total Indian aftermarket business is pegged at Rs 23,500 crore, of which about 35 per cent comes from the four- wheeler segment.

At present, Carnation Auto operates 13 multi-brand outlets across the country and had earlier announced taking the total of such outlets count to 30 by March 2010. It has also launched 10 mobile car service vans.

The company had last month raised Rs 170 crore loan from Punjab National Bank to fund its expansion programme. Earlier it had raised Rs 108 crore to start its business from PremjiInvest and IFCI Ventures.