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Making and breaking relationships

You win some and you lose some, the adage goes. And this month saw a bit of both with two carmaking family businesses, Fiat and Tata, bringing to an end their six-year sales relationship, while Kuehne+Nagel, a Swiss logistics family company, extended its partnership with a subsidiary of LVMH.
Making and breaking relationships - Fiat and Tata sever sales tie

You win some and you lose some, the adage goes. And this month saw a bit of both with two carmaking family businesses, Fiat and Tata, bringing to an end their six-year sales relationship, while Kuehne+Nagel, a Swiss logistics family company, extended its partnership with a subsidiary of LVMH.

In a joint statement with Tata Motors on 3 May, Italian automaker Fiat, controlled by the founding Agnelli family, said it will set up a standalone distribution company in India. This will break its supply relationship with Tata Motors, a subsidiary of the family-run Tata Group, after six years of working together.

“As part of the growth plans and in order to provide greater focus on the Fiat brand, Tata Motors will hand over the distribution and service responsibility for Fiat cars in India to a Fiat group-owned company being formed for this purpose,” the statement said.

However, the companies added their joint manufacturing operations will remain unchanged.

The move follows an attempt by Turin-based Fiat, headed by fifth-gen John Elkann, to ramp up its performance in the emerging economy – sale of Fiat vehicles have fallen by around 20% over the last year.

While the two carmaking companies part ways, Swiss group Kuehne+Nagel, majority owned by the Kuehne family foundation, has extended its logistics deal with Sephora, the retail beauty chain that forms part of family-controlled LVMH.

In a statement, Kuehne+Nagel, which until now handled Sephora’s Italian distribution centre, said its services will be expanded to other parts of Europe, the Middle East and Asia.

The Swiss group, which last year had revenues of €16.3 billion, will serve more than 300 Sephora stores, 112 of them in Italy, for the next three years.

Founded in France in 1970, Sephora was acquired by Bernard Arnault’s LVMH in the late 1990s.

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