FIAT CHRYSLER REPORTS STRONG RAM TRUCK SALES IN NORTH AMERICA
Aug. 12, 2019
Source: Marketing Daily article by Thom Forbes
Pickup trucks have given a lift to Fiat Chrysler Automobiles (FCA) a few weeks after its stock dropped 4% when Goldman Sacks initiated coverage of the automaker with a sell rating -- and eight weeks after its proposed merger with Renault hit the skids.
Its shares were up 1.70%, while most stocks slumped following the Federal Reserve's interest rate cut of a quarter point, which was not enough for the President.
FCA's results for the period ending June 30 surprised analysts.
"The Italian-American automaker on Wednesday reported a 14% year-over-year profit increase and its best-ever second quarter in North America, fueled by the new heavy-duty Ram and Jeep Gladiator pickups. The results prompted FCA to maintain its guidance for the year, even as such rivals as Ford Motor Co. decreased their forecasts for the year," Breana Noble notes for The Detroit News.
Fiat-Chrysler "has long lagged behind rivals in areas such as electric vehicles and self-driving technology. Sergio Marchionne, the longtime former chief executive who died a year ago, had focused for years on finding a partner that would ensure the company's long-term viability," Eric Sylvers writes for The Wall Street Journal.
Mike Manley, who replaced Marchionne as CEO, "said he has a strong business plan that can be developed without a merger and, while he is open to considering opportunities, the company can flourish on its own," Sylvers adds.
"Our people and hopefully our shareholders and stakeholders recognize that if we do something, we will only do it if it's in our interests," Manley said on a conference call with analysts cited by Sylvers and transcribed by Seeking Alpha.
"Known as a workaholic with an icy, no nonsense demeanor, [Manley has] been busy putting his own stamp on the company, according to interviews with executives who worked closely with him. He's dispatched with Marchionne's pressure-cooker style of having top lieutenants wear multiple hats and manage vastly different parts of the business, instead streamlining divisions and assembling a brain trust of longtime veterans and outsiders from Amazon, Nike, and Nissan Motor to help run them," Bloomberg's Gabrielle Coppola and Daniele Lepido report for Automotive News Europe.
"Mark Stewart, whom Manley hired from Amazon, now runs North America, a job Marchionne himself had done, while CFO Richard Palmer is in charge of business development, and not the systems and castings division he once ran under Marchionne. Manley also moved the CEO's office back up to the 15th floor at Chrysler's Auburn Hills, Michigan, headquarters, after Marchionne spent nearly a decade on No. 4, ostensibly to be closer to his foot soldiers," Coppola and Lepido add.
"FCA's U.S. shipments were down 12% in the second quarter but the group said that the successful performance of its Ram brand resulted in an enhanced share of the large pick-up truck market of 27.9%, up 7 percentage points from last year," Reuters' Giulio Piovaccari writes.
"The automaker's truck brand has been a solid performer for the company in the United States in 2019, and that, along with some help from the Jeep Gladiator midsize truck, has gone a long way toward boosting FCA's fortunes," observes Eric D. Lawrence for the Detroit Free Press.
"Now, it appears FCA's leadership could be considering updates to its Ram Classic, the older version of the Ram 1500. The two versions have helped Ram beat the Chevy Silverado in U.S. sales to take the No. 2 spot behind the Ford F-150. ... Manley said the dynamic between the Classic and the new Ram 1500 appears to be working well in showrooms," Lawrence adds.
"Shipments in Europe fell 10% after FCA discontinued two small Alfa Romeo and Fiat models in a bid to boost profitability in the region. Revenue fell 12%," The Motley Fool's John Rosevear writes for Yahoo Finance.
"FCA's luxury Maserati brand continued to struggle in the second quarter. Global shipments fell 46% as dealers worked to reduce inventories. ... While Maserati's struggles remain a concern, and the ongoing effort to revamp Europe has yet to bear fruit, FCA appears to be navigating difficult conditions in China and Latin America better than many of its rivals," Rosevear observes.
Looks like "hands are staying busier than ever" up on the 15th floor.