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If what the Financial Express reported today is true, then we are witnessing the second phase of the Tata-Fiat relationship. According to a news story today – Tata will focus on the lower end of the market and Fiat at the upper end. So the Tata One (small budget car) and the Indica range will be Tata’s focal areas while Fiat will look at the Palio, Grande Punto and the Linea.

Everything sewn up there till the C Segment but neither Tata nor Fiat has anything more upmarket than the Linea. One may argue that there is little to worry about beyond the Linea in the Indian market as the numbers are still quite disappointing, but hey a flagship never hurts and the Fiat brand especially can do with some dose of good repute.

While the companies have decided on the market segmentation divide, I am keen on what the product scene will look like. Have Tata and Fiat already started working on a joint platform? Will Fiat develop a new vendor base for manufacturing the 1.3-litre Multijet diesel engine or will it use the Maruti vendor base (I hope so). Or, will it use the Tata vendor base?