agent Entrepreneur logo
MenuMENU
SearchSEARCH

Fiat Sticks to Profit Target

October 19, 2011
3 min to read


TURIN - Fiat SpA's chief executive Wednesday stuck to his 2011-12 financial targets despite the weakening market in Europe, saying the Italian auto maker was doing well elsewhere, especially Brazil and the U.S.


"There's no need to change the numbers," Sergio Marchionne told reporters after the presentation of the Thema sedan and Voyager minivan, two new models for Lancia, Fiat's small but upscale brand in Europe.

Ad Loading...


Fiat has revised its 2011 targets after taking control of its U.S. partner, Chrysler Group LLC, reported The Wall Street Journal. It expects an operating profit before exceptional items of €2.1 billion ($2.89 billion) on revenue in excess of €58 billion, including Chrysler's contribution. The targets are only slightly higher than those achieved in 2010 because Fiat spun off its truck and tractor business into Fiat Industrial SpA at the end of that year.


Fiat has yet to publish a revision of its 2012 targets to take into account Chrysler.


"The good thing about at least parts of our business is that they are in cash-generation mode. The U.S. is in good shape. Latin America is in good shape. Europe continues to be a big area of concern," he said.


In the first nine months of the year, Fiat, which now includes the Chrysler and Jeep brands in its numbers, suffered the biggest drop in unit sales among the region's mass car manufacturers, down 12 percent to 735,494, according to industry figures. Its market share fell to 7.3 percent from 8.2 percent compared with a year earlier. By contrast, sales at Volkswagen AG grew by 7.9 percent.


Fiat makes nearly all of its profits in Brazil, where it is the market leader, and its merger with Chrysler has reduced its dependence on Europe.

Ad Loading...


Mr. Marchionne highlighted the difficulties Fiat faced in Europe this year and the next, especially in Italy, its biggest single market in the region. "This country right now is in gridlock and you need something to snap it out of its stupor," he said of Italy, where Fiat commands a 30 percent market share.


Mr. Marchionne said a strike at Fiat plants called for Friday by Fiom, a small but influential union in Italy, would hurt the country's image as a place to invest rather than the auto maker itself.


In the U.S., Chrysler, where Mr. Marchionne is also chief executive, has reached a tentative agreement on a new labor contract with the UAW. For it to become effective, the union must get its members' approval.


"I am hopeful and confident that we will it through," he said in reference to the UAW vote. "I think our people understand that this is the best thing I could achieve under the circumstances.


"The UAW and ourselves hammered out the best possible deal that we could...we know the limitations," he added.

Ad Loading...


Mr. Marchionne said he wasn't surprised by Tuesday's downgrade of Fiat's debt rating by Fitch Ratings Inc. the last of the three major agencies to do it.


"We have enough liquidity to deal with our requirements for quite a while." By the end of the year, Fiat aims for €18 billion of cash and up to €5.5 billion in net industrial debt.

More Industry

Group photo of men outside storefront.
Industryby Hannah MitchellMay 28, 2026

Pennsylvania Dealership Under New Retailers

The sale of the Chrysler Dodge Jeep Ram store puts a family auto group on a leaner path as first-time dealers take the helm.

Read More →
Hallway with lockered wiring and computer
Industryby Lauren LawrenceMay 28, 2026

Battery Storage Takes Priority Over EVs

U.S. automakers are prioritizing battery energy stationary storage over electric-vehicle production as the consumer demand for EVs lags the rest of the world.

Read More →
Gray-scale photo of a line of Mini cars in a dealership parking lot
Industryby Hannah MitchellMay 27, 2026

Auto Dealers Feel Better But Not Great

A second-quarter Cox Automotive poll of franchised retailers and independents found better views of the current market after a good spring but anticipation of third-quarter storminess.

Read More →
Ad Loading...
Closeup photo of the front of a white car
Industryby Hannah MitchellMay 21, 2026

New-Vehicle Sales Picture Relative

A May forecast is complicated by last spring’s trade tariff effects on auto retail. Despite continued hard realities, many consumers took advantage of ways to bite the bullet.

Read More →
Nissan logo on front of building
Industryby Lauren LawrenceMay 21, 2026

Auto Group Acquires Third Nissan Rooftop

Iowa-based Coleman Automotive Group recently acquired its seventh dealership, McGrath Nissan, which it renamed Nissan of Elgin.

Read More →
Couple talking with auto salesman next to new car inside dealership
Industryby Hannah MitchellMay 20, 2026

April Less Affordable

Based on prices, reduced incentives and slower household income growth, consumers found it more challenging to buy new last month, Cox Automotive reported.

Read More →
Ad Loading...
Wooden people figures of different colors in a row, similar to board game pieces
IndustryMay 20, 2026

Building an Extraordinary F&I Agency

Work to determine your specialized talent, because that fact will determine everything about your agency’s future.

Read More →
Ingredient card, policies and procedures, fixed operations, variable operations, data security, audit
Industryby Jim GantherMay 19, 2026

Recipe for Compliance

The secret to both amazing barbecue and compliance is the same: understanding the basics and committing to a process.

Read More →
Photo of new Chevrolet Bolt parked on a beach
Industryby Hannah MitchellMay 14, 2026

EVs Getting More Attractive

A growing percentage of U.S. consumers are open to switching and fewer are adverse to the idea, according to a recently completed survey. That’s despite the end of a tax break.

Read More →
Ad Loading...
Benchmark bar graph showing April 2026 EV Sales
Industryby Lauren LawrenceMay 14, 2026

EV Sales Drop in April Following Surge

North American electric-vehicle sales were down 28% year-over-year, a sharp contrast from global EV sales growth of 6%.

Read More →
Ad Loading...