Fiat Chrysler Automobiles said strong North American sales and brisk worldwide Jeep sales propelled the company to a $364 million profit in the second quarter of 2015, despite record fines from the federal government.
Overall, the company earned a pre-tax profit of $1.4 billion, which is double the $650 million it made in the same quarter last year, the Detroit Free Press reported.
The earnings beat expectations for the company, whose profit margins are still below the other domestic automakers. FCA reports its margin was 7.7 percent in the second quarter, up from 4.9 percent last year, but well behind the double-digit margins of Ford and General Motors.
Ontario’s debt is swelling and as home to eight manufacturing plants — the largest complex in North America — automakers may have a tough time keeping plants open in Canada’s most-populous province.
According to a story by the Financial Post, Ontario is moving forward with an ambitious plan to revamp roads and mass transit systems despite its debt being downgraded by Standard & Poor’s bond index. The broad public spending plan also extends to other sectors, despite high unemployment numbers and slumping manufacturing jobs.
Automakers such as Fiat Chrysler Automobiles have called on the provincial government to cut back on public programs and reduce costs on utilities in an effort to keep car building in the province profitable. This year, Chevrolet will shift production of its Camaro to Michigan. On the whole, Oshawa GM production has a dark cloud lingering overhead until the company decides what to do with the facility in 2016.
Fiat Chrysler Automobiles formally filed its initial public offering on Thursday to spin off Ferrari into its own separate company.
The filing doesn’t specify price or number of shares to be offered when the shares are publicly available sometime after Oct. 13.
Roughly 10 percent of the company will be publicly traded, with the rest of the company remaining under control of existing FCA shareholders and Piero Lardi Ferrari, Enzo Ferrari’s son and current vice chairman.
The former mayor of Oshawa, John Gray, is telling Canadians to boycott General Motors if the automotive giant pulls the plug on the Camaro at its plant north of the border, the Toronto Sun is reporting.
“That’s the type of pressure that is applied so that GM comes to its senses and maintains production in Oshawa after next year,” Gray told the newspaper this week.
General Motors said it would end production of the Chevrolet Camaro at the Oshawa Car Assembly plant and move production to Michigan on Nov. 20. Gray said the move would end about 1,000 jobs at the plant, and dim the prospects of an already bleak future for the plant.
Fiat Chrysler Automobiles’ top executive says he’s still not sure if Jeep’s Toledo plant will build the next-generation Wrangler, The Detroit Bureau is reporting.
In a move that may or may not be union-negotiations related, FCA CEO Sergio Marchionne said he expects to make a decision on where to build the new Wrangler by the end of the summer — or about the time negotiations wrap up.
With the imminent spin-off of Ferrari, Fiat Chrysler Automobiles boss Sergio Marchionne may be looking for a cash cow to help keep lagging brands at FCA afloat.
A story by Automotive News on Wednesday wonders aloud if Maserati will replace Ferrari as FCA’s marquee brand with double-digit profit margins. Behind Marchionne’s plan to sell the world on Jeep and Alfa Romeo, he would need to sell the world on the idea that Maserati is an exclusive, luxury brand, the article says.
Of course, that may be tough to do considering Maserati has always had a reputation for being Ferrari’s nerdy suburban cousin.
New Honda CEO Takahiro Hachigo told media Monday that the automaker wouldn’t aim for a specific global sales figure to drive growth and would be open to partnerships with other automakers, Automotive News reported.
The speech also emphasized sharing global manufacturing resources within Honda’s six regional divisions and to create “challenging products.” (Which may or may not — probably not — mean “Challenger.”)
Speaking at an unrelated Fiat 500 reveal last week, Fiat-Chrysler chief Sergio Marchionne said Ferrari is worth about $11 billion and he expects the prancing horse’s IPO to garner about $1.1 billion went it goes up for sale in October.
“There are clear expectations from ourselves as Ferrari brand is unique,” Marchionne said, according to Bloomberg News. “There is also a scarcity value as we are just selling a 10 percent stake.”
Marchionne’s estimate is roughly double what brokers said the Maranello-based manufacturer could be worth almost a year ago.
More and more automakers are looking at exotic locales to produce their wares (us Canadians can consider Mexico exotic thanks to its ice-free beaches) as they expand their brands and explore in-roads to untapped markets.
For Jeep, that means investing in a shared money-printing press with an unlikely partner: Tata, the parent company of Land Rover. FCA will put $280 million USD into joint venture Fiat India Automobiles Private Limited which, since 2007, has solely produced Fiat models.
Jeep is looking at global growth upwards of 20 percent this year to 1.2 million units and that’s before the brand truly ramps up in China.
Could it be possible Jeep’s success is hiding what ails other brands at the newly-formed Fiat Chrysler Automobiles?