Fiat will not ramp up production in its Indian venture Fiat India Limited (FIL) till its next small car - Palio - is introduced in the first half of 2001, the officials said.

Meanwhile, the company has recorded a 36.1 per cent drop in sales in June, 2000, having sold around 1,000 units, down from 1,565 units in the same month a year ago. The sales represented a 9.17 per cent decline from 1,101 units in may this year. With this, the company has sold around 7,753 units in the first half of the 2000 calendar year.

"We have taken a conscious decision not to increase sales and will concentrate on building up support services. We are not in the number game for the present. Fiat will wait for Palio to give it volume sales," the official added.

FIL has decided to price Palio in the Rs 3.5 lakh-Rs 4 lakh range. Expected to be the company's "moneyspinning model", the official said that Palio would be introduced with an 80 per cent local content level.

"We have to reach the target cost to allow us to meet price levels."During May, 2000, the company had sold 901 units of Uno and 200 units of Siena. FIL sold 1,365 units of Uno and 249 units of Siena during the same month last year.

During the first five months of the 2000 calendar year, the company has sold a total of 6,753 passenger cars, including 5,535 units of Uno and 1,218 units of Siena.

Fiat Auto Spa of Italy holds around 95 per cent stake in FIL, while the remaining 5 per cent stake is with Premier Automobiles Limited of Mumbai. Fiat already has the foreign investment promotion board (FIPB) approval to convert the joint venture into a wholly-owned subsidiary.