The result is a workforce willing to adapt to the Palio's requirement for flexible manufacturing.
In all, the Palio model has just 130 component suppliers, compared with around 200 for the Uno.
The Palio assembly line uses rotating cradles that tilt the car body to convenient angles improving both quality and job satisfaction.
After careful study, the company decided to automate only those parts of the Palio line at Betim where precision and quality were vital.
The Palio at its most basic is a horse race which takes place twice a year in the picturesque medieval hill town of Siena, Italy.
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During 1994-95, Fiat sent 290 workers and engineers from Betim to Turin to set up a pilot production line for the Palio and build a prototype.
Since its launch, the Palio has given Fiat the lead over Volkswagen in the Brazilian market, which accounts for 70% of all South American car sales.
Thus Fiat makes a version of the Palio at Cordoba in Argentina to export to Brazil, instead of at its huge Betim complex, sacrificing potential economies of scale.
Both French companies are following in the footsteps of Fiat, which sells one in five of its cars in Brazil, where it first launched the Palio, a rugged but stylish small car that will soon be produced in India and North Africa too.
Instead, they are buying stripped-down entry level vehicles with weak security features in models like the Volkswagen Gol, Fiat Palio and the Chevrolet Celta.
The new versions of the Punto and Palio in a few years will share chassis as well as engines and gearboxes, enabling production of some 2m vehicles from a single platform, and yielding the sort of economies of scale these days enjoyed only by the likes of Toyota, with its Corolla world car.
In Brazil, Argentina, Russia and India, it has also opened or started building huge new factories to make its so-called world car, the smart and rugged little Palio.
Keen to experience the drama and chaos of Il Palio at close range?
On the downside, competition is so fierce that fistfights sometimes break out between contrade, and Il Palio jockeys often live in fear from rival contrade.
Excluding the engine, where efficiency will reach Italian levels only when a new engine plant is opened, it takes around 21 man-hours to build a Palio in Betim, or about two hours more than it would at Melfi, the firm's most modern Italian plant.
Il Palio is one of very few surviving medieval spectacles of its type in Italy, enduring thanks to the sheer tenacity of Sienese traditionalism.
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