Automotive News Europe - March 2, 2009 - 14

PAGE14 · www.autonewseurope.com March 2, 2009 Q & A: Leonardo Fioravanti Photo: Lyle Frink Fioravanti: Italian design could benefit from global auto crisis Industry veteran says that coachbuilders are suffering from bad decisions of past The worst crisis for the auto sector since the Great Depression is accelerating the sunset for the Italian coachbuilding sector, which has been in trouble for years. The grim outlook does not scare former Pininfarina, Ferrari and Fiat design director Leonardo Fioravanti, who in January became president of the Italian coachbuilders’ association. Fioravanti, who opened his own design and engineering consultancy in 1987, sees opportunities. He says the crisis will require automakers to reinvent the automobile – which could benefit Italian design firms. Automotive News Europe Senior Writer Luca Ciferri interviewed Fioravanti at his design studio in Moncalieri, near Turin, on February 6. How can Italian design benefit from the current global auto sector crisis? The global auto industry created too many exaggerated, useless and anything-but-intelligent cars. This truly terrible global crisis also serves as the medicine that would cure these excesses. To survive, the industry now needs to re-invent the automobile. Where there is a need for invention, there is also space for Italian creativity. “We have been in an era of ‘shouted’ design, where decoration prevailed over form and also over function.” Leonardo Fioravanti ing that coachbuilding in Europe – not only in Italy – is currently facing an unprecedented crisis. As far as Italy is concerned, what we are facing today is just the end result of questionable decisions made more than a decade ago. Questionable decisions? When Italian coachbuilders became just an extension of automakers’ plants, they lost the added value that made them unique. Italian coachbuilders were famous for the beautiful cars they designed and built themselves. By not adding your own quintessential value in terms of Italian elegance, flavor and craftsmanship, you become an extension of an automaker’s plant. When automakers recall low-volume production back into their own plants, coachbuilding in significant scale slides toward extinction. Could there be a new space for cars designed and built in Italy, going back to the roots of Italian craftsmanship? There is. Incidentally, we penned the SP1, the first of a series of oneoff units Ferrari will build for collectors. Unfortunately, even if oneoff unit production grows substantially, it is hard to imagine this business employing thousands of workers like Italian coachbuilders did during their golden years. ANE Installing this barrier will earn the Czech owner of this Skoda Octavia a VAT refund. What makes Italian automotive creativity so special? We have been in an era of “shouted” design, where decoration prevailed over form and also over function. This is the opposite of Italian design, always pure and rational. I am convinced the future entails returning to the roots of beauty, to proportions created to dress a function, not just metal added purely to make the vehicle look more brutal. How would you define beauty? “Beauty is the shining of truth,” Greek philosopher Plato said. Good Italian design is the same as good wine: It gets better over time. A pure shape maintains its appeal. An overdecorated car, ages quickly. But Italian coachbuilding is in trouble. Maggiora and Carrozzeria Bertone stopped making cars years ago. Pininfarina will cease contract manufacturing in 2011. From your perspective, what went wrong? As an engineer, I am an optimist by definition, but not to the point of deny- Countries try sales tax break to boost car sales Lyle Frink Automotive News Europe PRAGUE Adjusting value added tax rates is one way that some European governments are trying to stimulate new-car sales. In the UK, the tax was lowered to 15 percent on all purchases, a decrease of 2.5 percentage points. Similarly, the Polish government is debating lowering the VAT on new-car purchases. The Czech government recently sent an amendment to Parliament proposing that businesses can reclaim the VAT paid on company cars. Right now, only light commercial vehicles qualify for the reimbursement. “It seems to be a trend for governments to look at VAT to stimulate demand,”said Peter Skelhorn, a Prague-based PricewaterhouseCoopers analyst. But unlike the EU-wide scrappage policy on old cars that is now being discussed, creating a synchronized VAT formula is not likely, Skelhorn said. Individual countries have tinkered with the VAT formulation in an attempt to increase company spending or, conversely, raise government tax revenue. Full VAT reclamation on businessfleet purchases is available in eight EU member states, partial reclamation in four states, and no reclamation in the remaining states. Within central Europe, VAT deductibility is limited. Since 2003, Czech businesses have avoided the country’s VAT law by converting cars into light commercial vehicles. Last year, 29.5 percent of all Czech new-car sales were for models that had been modified by adding a divider between the passenger and cargo areas. Doing this let the cars meet the government standard to be classified as an LCV and qualify for a refund of the country’s 19 percent VAT. ANE

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Automotive News Europe - March 2, 2009

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