{"id":128196,"date":"2018-07-25T13:09:28","date_gmt":"2018-07-25T17:09:28","guid":{"rendered":"http:\/\/www.thedetroitbureau.com\/?p=128196"},"modified":"2018-07-25T13:14:30","modified_gmt":"2018-07-25T17:14:30","slug":"fca-reports-lower-than-expected-earnings-as-it-mourns-marchionne","status":"publish","type":"post","link":"https:\/\/thedetroitbureau.com\/2018\/07\/fca-reports-lower-than-expected-earnings-as-it-mourns-marchionne\/","title":{"rendered":"FCA Reports Lower Than Expected Earnings as it Mourns Marchionne"},"content":{"rendered":"
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Mike Manley, new CEO of FCA, led a moment of silence today before leading the reporting of the company's second quarter earnings.<\/figcaption><\/figure>\n

Fiat Chrysler Automobiles reported Q2 earnings that were lower than expected, but that was surpassed by news that former CEO Sergio Marchionne died due to complications from surgery in Switzerland.<\/p>\n

The company\u2019s executives, including the newly appointed replacement for Marchionne, Mike Manley, soldiered on through the earnings call, starting with a moment of silence to honor the man many believe saved Chrysler from extinction.<\/p>\n

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Subscribe Now!<\/figcaption><\/figure>\n

Then they moved on, as they believed Marchionne would have insisted, to describe how slow sales in China put a drag on the company\u2019s earnings results despite impressive sales in North America during the first half of the year.<\/p>\n

FCA\u2019s adjusted earnings before interest and tax (EBIT) for the second quarter fell 11% to 1.7 billion euros ($2 billion), compared with 2 billion euros in a Reuters poll of analysts. The result was a revision of its short-term forecast.<\/p>\n

(Former FCA CEO Sergio Marchionne dead at 66. <\/em>Click Here<\/a><\/span>\u00a0for the story.)<\/em><\/strong><\/p>\n

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Former FCA CEO Sergio Marchionne would have approved revising the guidance offered by the automaker, officials said.<\/figcaption><\/figure>\n

Officials said they expected 2018 net revenues of between 115-118 billion euros, down from a previous forecast of about 125 billion euros. Additionally, adjusted EBIT should come in between 7.5-8.0 billion euros from at least 8.7 billion. However, they also said none of their previous forecasts need to be revised.<\/p>\n

It was a slump in Chinese demand last quarter ahead of a July cut in import duties, that pushed the company to offer higher incentives and an increase in unsold vehicles that \u201cparticularly affected Maserati,\u201d Manley said.<\/p>\n

Maserati sales were down 35% globally, but fell 65% in China, the world\u2019s largest luxury car market.<\/p>\n

Overall, FCA branded vehicles struggled as well. The company\u2019s inventory rose from 98 days supply to 129 for Asia Pacific, will continue to impact results as stocks are cleared ahead of new emissions regulations, Manley added.<\/p>\n

(<\/em>Click Here<\/a><\/span>\u00a0for<\/em>\u00a0a look at the challenges facing new CEO Mike Manley.)<\/em><\/strong><\/p>\n

\u201cChina is a clear priority for me in the coming weeks,\u201d Manley said during the analyst call. The company said it expected sales in China to move upward by the fourth quarter. The company noted its new China-specific Jeep, the Grand Commander, will be at full production levels then.<\/p>\n

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The Jeep Grand Commander is the first-ever China-specific built Jeep, officials noted.<\/figcaption><\/figure>\n

If would have been worse if not for the staggering performance of the company\u2019s North American unit, specifically the U.S. where sales rose 8% during the quarter. Jeep sales were up 21% due to all-new Wrangler and Compass models. Ram sales were down 4%, but that was due largely to lower fleet sales. Retail Rams sales rose 5%.<\/p>\n

Ram sales are expected to improve, said Manley as the new heavy-duty model ramps up production in the next quarter and the new light-duty truck continues its move toward full production. Manley said it\u2019s currently at \u201c80 to 85%.\u201d<\/p>\n

FCA officials reiterated 2022 goals set out by Marchionne in his last investor presentation on June 1, including a doubling of operating profit and a 9 billion-euro plan to catch up with rivals in hybrid and electric cars remain unchanged. Manley, in particular, noted his commitment to making it happen.<\/p>\n

(To see what the new 5-year-plan holds for Jeep, Ram, Alfa and Maserati,\u00a0<\/em>Click Here<\/a><\/span>.)<\/em><\/strong><\/p>\n

\u201cMy mandate is to deliver that five-year plan,\u201d Manley said on Wednesday, stressing that the company would remain independent yet \u201cflexible\u201d about any new tie-up opportunities.<\/p>\n","protected":false},"excerpt":{"rendered":"

Fiat Chrysler Automobiles reported earnings that were lower than expected, but that was surpassed by news that former CEO Sergio Marchionne died due to complications from surgery in Switzerland. See more at TheDetroitBureau.com.<\/p>\n","protected":false},"author":4389,"featured_media":128100,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","footnotes":""},"categories":[7,8,5],"tags":[],"make":[33,46,51,54,82],"post-state":[],"category_old":[208,286,150,151,123,287,228,173,289,299,191,262,171,132,199,284,125,139,290,288],"acf":[],"_links":{"self":[{"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/posts\/128196"}],"collection":[{"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/users\/4389"}],"replies":[{"embeddable":true,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/comments?post=128196"}],"version-history":[{"count":0,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/posts\/128196\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/media\/128100"}],"wp:attachment":[{"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/media?parent=128196"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/categories?post=128196"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/tags?post=128196"},{"taxonomy":"make","embeddable":true,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/make?post=128196"},{"taxonomy":"post-state","embeddable":true,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/post-state?post=128196"},{"taxonomy":"category_old","embeddable":true,"href":"https:\/\/thedetroitbureau.com\/wp-json\/wp\/v2\/category_old?post=128196"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}