On Wednesday, Fiat Chrysler Automobiles CEO Sergio Marchionne will update investors on his long-term plans and fourth-quarter profits — namely, how many Jeeps it sold — during his scheduled earnings conference call.
It’s widely expected that Sergio will address the near-certainty that Jeep will build a pickup based on the Wrangler, as well as the future for the Jeep Compass that’ll likely survive from the Patriot/Compass twin billing, and Jeep’s potential to keep afloat fledgling FCA brands such as Maserati and Alfa Romeo.
Analysts say FCA’s ambitious target of $5 billion profit by 2018 would be almost unattainable at this point.
“‘Ambitious’ is not really an adequate word to describe it, ‘fantasyland’ might be more appropriate,” Bernstein’s Max Warburton told Automotive News.
A year ago, TTAC broke news of back channel overtures being made towards Iran on behalf of General Motors. A number of Chevrolet Camaro Convertibles made their way to Iran via a complicated logistics network and the importations were of dubious legality. But the event highlighted a sentiment in the auto industry that few are willing to openly discuss: the BRIC countries, once the darlings of the emerging markets, have already been exhausted. The search for new markets is on, and that means places like Africa and Iran. And Cuba could be next.
According to this Brazilian site, this is the list of the 10 most sold cars in the history of Brazil. Some of them are just for us, while others have been sold in other countries, even in the First World, even if under a different brand, or a different company altogether. Do you think you have a clue? Don’t worry if you don’t, even I was surprised by some.
The Russian government said that it will spend up to 271 billion rubles ($8US billion) over the next three years to subsidize the country’s struggling auto industry. A government web site said that the subsidies will underwrite research & development, jobs and costs related to more stringent emissions standards. Car sales in Russia in 2013 fell by 6% to 2.78 million units and 2014 looks like another weak year as the Russian economy stutters, according to the Association of European Businesses.
Nissan last sold a car branded as a Datsun in 1981, but it’s bring the brand back for emerging markets like Indonesia, India, Russia and South Africa. The low cost brand will be launching in April in Russia with a starting price below RUB400,000 ($12,100) and go on sale there in late summer or early fall. Nissan is hoping that the new/old brand will attract consumers that had been considering used cars.
“The main objective (in Russia) is to be a serious alternative to the used car market – this is where we want to compete,” Jerome Saigot, director of Datsun’s operations in Russia, told Reuters.
Recently, as to the attention given by TTAC to the spy shots of what might be or not a future Ford Ka sedan in southern Michigan, commenter Kenmore asked, “Has any other sad little runt of an econocar ever received so much attention on TTAC?”. Since you asked, I’ll offer up a brief pictorial explanation.
Emerging markets have been a big theme at TTAC for the past few years, with our coverage going beyond the cursory articles on automotive developments in the BRIC countries. Our articles on places like North Africa and Indonesia aren’t always the most popular, but we keep an eye on them for a very important reason. These countries are the final frontier for growth in the automotive sector.
Hyundai and Kia are on a tear in the European market, having recently passed Toyota to become the best-selling Asian automaker in the EU (at 605,386 units, some 50k away from Daimler’s 2010 sales). And with its first Europe-centric product coming online, aimed at the heart of Europe’s 896k unit midsize segment, it hopes to keep the growth coming. In service of that goal, Hyundai is moving European production of its iX35 (Tucson) CUV from Kia’s plant in Zilina, Slovakia, to its own factory in Nosovice, Czech Republic, and adding an extra shift according to the WSJ. And unlike many of its European competitors, Hyundai is keeping its Euro-zone production capacity on the slim side, importing the forthcoming i40 from South Korea and the i10 from India, helping to keep the Korean automaker out of the overcapacity trap that plagues its competitors. Though Hyundai has good prospects for growth in Europe, production capacity expansions are being targeted at the developing markets that show more promise for growth.
Scotia Bank in Toronto has an insightful and resourceful car analyst, Carlos Gomes. Whatever he writes is worth reading. He expects car sales to rise and the “United States and the euro zone to climb out of their deep hole.” He also expects that the developed nations are ripe to be plucked and eaten by an upstart, roughhewn crowd:
“In 2011, new car sales in China and the other BRIC nations (Brazil, Russia, India and China) will surpass the combined volumes of Western Europe and Japan, and account for roughly 30 per cent of global car sales.”
Here is his case:
A report about the automotive industry in the BRIC countries, released by the Boston Consulting Group, throws cold water on the low cost production story:
“In manufacturing, companies are generally paying a premium of 5 to 15 percent to manufacture in the BRIC countries, mainly because of diseconomies of scale and higher quality-assurance costs than they incur in the more developed markets; only in Brazil do they actually save money on manufacturing.”
Apart from this astounding revelation, the rest of the report is full of platitudes and comes 20 years too late: