FCA sales in the rest of the world, esp USA, Europe and Middle East, Brazil

@Raj_pol

This is OT but a hybrid dealer+FASS model going forward in the longer-run makes the most sense: Fiats, whether locally made, ckd or cbu sold+serviced: somewheres out of Tata outlets (which are much improving...), elsewheres independent Fiat/FASS, elsewheres third-party servicing (eg, mahindra first choice) combined with e-commerce, not to mention the 'premium' Fiats (eg., 500, 500X, Abarths, Aegea....) folded into the Jeep dealerships and their service centres which should surely number say 30-50 by 2018?

The dealer issue is secondary: FCA has good options going forward, esp IF they can re-strike the retail and service deal with Tata in some cities at least. And esp with presumably higher quality dealer experiences made possible by the new, seperate Jeep ones, for the biggest cities/markets. And if they make a big push, perhaps alongwith Tata-JLR, for an e-commerce approach to car retail, in some cities/sub-cities?

The real issue is of product strategy, bearing risk-reward in mind for this market, given its peculiarities: localized and/or ckd with high local content, and/oror pure cbu or ckd? Which models?

AND: can the dealer quality handle the chosen higher-priced models, eg the new 500, the upcoming 500 5-door, 500X, the 124 Spider roadster or the all-new Fiat Freemont big-suv replacement or the Aegea sedan?

 

FCA sales in Britain and Mexico are up, for June 2015, more or less in line with the overall average marketgrowth, which is higher than many of their main competitors (eg., VW and Ford).

The Mexican car market in particular has grown as much as 25% (approx), and so has FCA.

The Brazilian Grand Sienna is selling decently, re-badged as a dodge as is the Mitsubishi Attrage sedan. the Dodge journey (=Fiat freemont) is FCA's most in-demand vehicle there.

Mexico is very likely to receive a lot more investment from FCA in its old plants there, for exports into the USA going forward, given the relatively over-valued US dollar, and the set-to-soar labour costs in the US what with the UAW trade union talks starting soon with the union wanting to withdraw all concessions made to Chrysler at the time of the bankruptcy/takeover in 2009.

The Renegade+500X together are faring well in the UK. However, despite or perhaps because the Panda+500 are so popular there: the 500X does not seem as yet to be anything like an outright hit. Perhaps RHD 500X-s are yet to be delivered in big enough numbers?

 

http://www.freep.com/story/money/ca...-chrysler-fca-italy-merger-benefits/29790855/

Interesting and accurate, if terse, article on the FCA merger's history, relative to the very willful Sergio M's refusal to cater to Italian manufacturing or new models, until recently. And how FCA is now hitting its stride in Italy, in investment and innovation terms: starting with Maserati's 2-year old big-bounce in rather profitable sales, then the Jeep Renegade+Fiat 500X, and now the first of 7-8 all-new Alfa Romeo-s, also all-new engines...

 

FCA sales for June 2015 in TURKEY

The Turkish car market is bouncing back incredibly fast: up 45% in June, and 50-60% overall for the first 6 months of the year.

FCA sales are up hugely too, especially the Fiat Linea, up 60% plus for the year so far, and the host of locally-made and exported Fiat lcv-s (Doblo, Fiorano, Ducato....). Together, about as much or a little ahead of the average sales growth for the overall market.

The real kicker for FCA is, of course, Jeep: FCA is selling 300+/- Jeeps every month in Turkey.

The stage really is set, then, excellently, for: the Aegea sedan and hatch and sportswagon, for which Turkey is the (so far) only manufacturing, mostly for exports, hub.

Also: the 500L is unusually popular in Turkey, selling more even than the Punto.

 

FCA sales in Europe/EU-as-a-whole in June

As it has every month this year, both the Fiat brand and the Jeep one have grown notably more than the market overall, leading to increased marketshare overall.

For Fiat: largely thanks to the 500X, though 500, Panda, Freemont, 500L and Punto sales have held up well. A heavily facelifted, esp interiors, Fiat 500 has just been launched.

Jeep, thanks to the Renegade esp, but with good numbers for the Wrangler, Cherokee and grand Cherokee too has grown immensely this month, and this year.

Alfa Romeo still has notable following in many European countries: the Giulietta's sales have held up well, so with the all-new bigger RWD sporty Alfa-s.....

The 500X which became available only in March/April is selling well in the booming and very competitive smallish-crossover market, as is the very distinctively American-style Renegade. It is not yet at its final, full sales figure. But: it may be that despite most reviews regarding it as near-best in its segment, it will not be the European crossover #1, 2, 3 or maybe not even 4 though combined with its twin the Renegade, it's a big hit.

 

http://news.allpar.com/index.php/2015/07/fiat-chrysler-whipped-ford-in-q2-sales-growth-29365

Ford's financial results are much more impressive (thanks to their potent market share in N America, for both retail customers and especially fleet+police+government sales) than their sales performance in the booming US market.

FCA's far outdoing them, gaining marketshare at their and at Toyota+Honda+Hyundai's expense in the US.

FCA's USA sales to retail, private customers have just overtaken FOR THE FIRST TIME IN the HISTORY of these 100+ year old brands, Ford as well as GM!

A staggering achievement by Marchionne et all, given the for-all-practical purposes death of these brands back in 2009, just 6 years ago!

Profit margins, however, for a number of reasons to do with the merger terms, costing and Chrysler-Jeep-Dodge-Ram's investment-starved nature under its 2 previous owners.....are another matter.

However, there too it seems margins are moving up, likely well over 4% this quarter in the US. They've 'promised' a net margin of near 8% by the end of this financial year in the US. Let's see.

FCA reports in euro-s, and so with the depreciation of the euro and the relative appreciation of the dollar, FCA's net-profit performance for this last quarter should show a smart uptick, likely the first of several such quarterly upticks, as the European car market rebounds strongly, and as Euro-denominated exports (e.g., Renegade, 500X, Maserati, Alfa Romeo...with several more to come soon) pickup even further.

 

Will the recent recall of JEEPs will have any impact on these reports. Hope FIAT stays No. 1 at least in other countries.
Practicality matters in these markets.

 

http://www.autonews.com/article/20150730/OEM/150739987/fcas-q2-profit-rises-69-on-strong-nafta-sales

FCA's profits are up 69% (!!) for Q2 of 2015....

despite the deep recession in Brazil, Fiat's biggest market, despite offering only 2 all-new Fiat models (500X and earlier 500L) in the last 4 years in Europe. Of course, the 3 Aegea models (hatch+sedan+sw) come on-stream soon enough, as will a C-Suv from Jeep and a c-suv under the Fiat brand (sized a little smaller than a Fortuner, much bigger than the 500X).

despite the 0 profits from retail sales in India.

despite the fact that China is slowing down in luxury/premium car sales too. Which is ok for Jeep and FCA unlike other firms, since they are only later this year startign their locally-made-and-priced manufacture there.

The 10% ferrari divestment will yield around a billion dollars, to be used to retire high cost debt from the time of the merger of Fiat with the Chrysler brands.

New Minivan, several new Alfa Romeo-s, several all-new Fiats (including for India and Brazil) coming up soon/soon-enough.

i.e., FCA's star is rising fast, and not just financially, and that'll make them pretty singular/unique in the global car industry, which is struggling for profit margins and marketshare.

Of course, IF the China+Middle-East slowdown/crisis infects Europe, the US and even India, which if mild should be ok, but if a serious contagion effect.....all bets are off!

FCA's attractiveness as a strategic or even merger-partner is increasing. Hopefully that makes such a 'deal' more likely to happen, and sooner! (with Tata Motors including jlr? with suzuki? with Peugeot-Citroen? Renault-Nissan and/or Daimler?....)

btw, Marchionne did drop a hint during the q2 analyst investment-call that a sale or at least a spin-off of Magneti marelli is very likely, if not immediately. Which would yield one to three billion dollars worth of debt-reduction and new-model investment financing for FCA and Marchionne.

 

http://www.gwinvestors.com/2015/07/30/fca-valuation-update-zero-to-sixty-in-2-99-seconds/

This is just an analytic opinion from just one stock/investment market analyst group. And as such can be theoretically, empirically and probablistically disputed. That said:

They're seeing FCA as the biggest and best bet for huge sales and especially financial growth and success in the whole global automotive industry, over the next few years.

Indeed there are bullish factors eventhey're not taking into account in this article. namely:

(a) FCA's balance sheet is in euro-s. But most of its profits, and rapidly rising profit margins, are from NAFTA, i.e., in dollars. The euro is depreciated against the overvalued dollar. ergo: just relative currency shifts, which are long term/structural and not just contingent, will and already is adding hugely to FCA's profitability, and hence its ability to invest in all the new models commited to, on time, to reduce debt levels, and to make itself a more attractive merger/consolidation partner

(b) FCA has accomplished a big diversification of global production plants, locations including supply chains, pretty much state of the art, in: Brazil (the new Pernambuco plant), Turkey (the tofas jv plant which will make and export the new Aegea models as well as the current ones), China (Viaggio+Ottimo, soon Jeep cherokee, next year renegade, in/by 2018 the Chrysler 200 and the 500X....) and of course India (the tate jv at ranjangan, mainly for engines and for tata and jeep suv-s)

These locations all offer very high cost-advantages, and have depreciated currencies that also enable a big export-revenue boost, including exports of the more sophisticated cars and modules/engines, transmissions etc right back to Europe as well as to the USA.

This will add a lot to FCA's profitability.

(c) the sale or spin-off and partial/full divestment of Magneti Marelli etc could yield 2.5 to 3+ billion dollars soon enough

(d) immediate margin and profit boosting via a share swap or even merger between FCA and its old partners (small scale) Tata Motors, and/or Suzuki and/or Peugeot-Citroen let alone some 'big deal' with the likes of GM or VW

And so, all else being equal, namely, a global financial economic melt-down/depression, FCA will almost inevitably be the world's best growing and most improving car company, with even good prospects of counter-cyclical growth and profits even in recessionary LatAm (Fiat sales are down badly there, but Brazil-made Jeep sales at much higher avg prices are already high with just one model out yet, the Renegade) and in slowing-down China. And silently rising profits even from India where FCA's own-brand sales are so far or as yet negligible, via Tata and Suzuki.

The brand renaissance even of the dead American brands has been amazing, which enables good sales just as soon as all-new models, especially replacements of the very aged ones like the Minivans, and especially the entry into segments where the brands are still missing (compact sedans with the Aegea based Chrysler 100+Dodge hatchback etc), are launched.

Judging from the reception of the Alfa Romeo Giulia, and the huge platform, engine+transmission etc sharing that the new Alfa-s will share with the near-future new Dodges, Chryslers, Maserati-s and Jeeps....there could easily be a good upside financially to the whole Alfa Romeo re-launch and expansion, EVEN if the hyper-ambitious targets of 40000 Alfa-s by 2018 is NOT quite met.

Further, if the European car market continues to stay buoyant even if not rebounding pacedly as it currently is, much to FCA's marketshare and profitability benefit already: FCA will likely add sales and marketshare a lot, given the deliberate rationing, now ended, of all-new models/segment-offerings ver tha last few years by Marchionne. the Aegea sedan+hatch+SW, the Fiat C-Suv, the Jeep C-suv, the Fiat 124 Spider/Coupe, corresponding Abarths, a 5-door 500, and possibly a cut-price all-new Punto and/or 'New Avventura or Fiat b-suv' exported there from either Brazil or India?

In sum: FCA and in particular Marchionne are one amazing company and bunch of old yet reborn and revitalized, powerful brands + genius ceo!

With any luck, all this also means that FCA will commit more human and financial resources to cracking their big FIAT- brand India legacy-problem, and not just to the manufacture, export and launch of JEEP, supplies to Tata and Suzuki, global r&d, etc?

I for one, like the above analyst group whose article is linked, am VERY 'long' FCA's stock, and would be investing big time in it (relative to one's small investment funds of course), if only it were listed here as well. The moment one feels a big, global tie-up between tata motors and/or suzuki and FCA is going to occur, those stocks (good ones in themselves) become great proxies for FCA?!

 

http://news.allpar.com/index.php/2015/08/fiat-chrysler-july-sales-beat-forecasts-29539

FCA's scorching, and distinctly best pretty much for any non-ultra-luxury marque, record setting sales growth pace in the US continues.

Despite sharply lower sales for the old Minivans given that the plant has been ou-of-action since it is being re-birthed as a high-end one for the upcoming all-new Chrysler Minivan, including mild and full phev variants. Insiders who work at that plant have testified to it being an outstandingly good model inside and out.

However, like Mini et al, the sharp drop in fuel prices seems to've hurt sales of the Fiats in America, in any case not a hospitable market for small cars, however chic and spicy. But the Fiat Doblo and Ducato vans (badged Ram Promasters), built in Turkey and exported to the US with American powertrains of course rather than the typical 1.6 and 2.0 mjd-s, are doing well, breaking new ground for FCA in that market segment.

All else being equal, FCA's scorching sales and marketshare (as well as now steep fast profit margin growth, up this quarter from 4 % odd just 5 months ago to 7.7% apparently) is set fair to continue, given the new Minivan launch soon, the new Jeep C-Suv too....and the Fiat Aegea as (in some form) the Chrysler 100 compact sedan as well as the Dodge sporty hatch. The only question being whether they're exported, like the vans, from the turkish JV-Tofas plant in Turkey that is the specialist for the Aegea, as opposed to being made either in the US at a freshly-invested-in plant or even in lower-cost Mexico within NAFTA tariff walls.

This is just yet another testament to Marchionne and esp Olivier Francois' truly amazing blowing-so-much-vigorous-life and elan into these (five years ago) near-DEAD, OLD, tired and abused and maltreated American brands. Impressive and imaginatively so, brilliant!