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Peugeot maker PSA posts record profits ahead of FCA merger

PARIS — Peugeot maker PSA Group said its profitability reached a record high in 2019 but the French carmaker forecast falling industry sales in Europe this year as it pursues its merger with Fiat Chrysler, which is strong in North America. PSA has trimmed costs in areas such as the procurement of components as it has integrated its acquisition of Opel and Vauxhall, boosting operating margins to 8.5% last year. The group, which also produces cars under the Citroen and DS brands, offset a slump in vehicle sales by selling pricier SUV models, with launches including the Citroen C5 Aircross helping to lift revenues by a higher-than-expected 1% to $81.2 billion (74.7 billion euros). That helped it stand out in a car market where some rivals including France's Renault have struggled with sliding revenues and profits, amid a broader downturn in demand. PSA's group net profit increased 13.2% to a record 3.2 billion euros, and the company increased its dividend against 2019 results to 1.23 euros per share, up 58% from 2018 levels. The carmaker was "once again very solid", analysts at brokerage Oddo-BHF said in a note, adding the results confirmed the company's "best-in-class status." However PSA forecast a 3% contraction in Europe's car market this year, by far its biggest market. The tie-up with Fiat Chrysler will help it gain exposure to that group's strong presence in North America with brands like Jeep. The two companies struck a deal in December to create the world's No.4 carmaker, to better cope with market turmoil and the cost of making less-polluting vehicles. Fiat also posted more upbeat results than most rivals this year. CORONAVIRUS WEIGHS PSA boss Carlos Tavares told a news conference that the two groups were both in good shape and well placed to face market challenges together. He said he did not expect any major regulatory hurdles to the merger, adding it had so far submitted 14 approval requests to competition authorities out of the 24 it needs. There are no immediate plans to change anything in the large portfolio of brands within the combined group, he added. However the companies still face problems this year, including the coronavirus outbreak which has paralyzed production in China and hits carmakers' supply chain. PSA said the coronavirus impact was still difficult to assess. It factories in Wuhan, at the epicenter of the outbreak, are due to reopen in the second week of March.

Chrysler purchases remaining shares from VEBA Trust, announces funding plan

It's official: The Detroit Three is now The Detroit Two and The Fiat Subsidiary, Chrysler. Both the Italian carmaker and The Pentastar announced the completion of cash payments and a Memorandum of Understanding (MOU) on future payments necessary to make the Chrysler Group a wholly-owned subsidiary of Fiat. As previously detailed, Chrysler made a cash payment of $1.9 billion and Fiat North America made a cash payment of $1.75 billion to the Voluntary Employment Benefit Association (VEBA) run by the United Auto Workers union.
On top of that, Chrysler Group signed an MOU that agrees to payments of $700 million to the VEBA in four installments, the first of which was made concurrently with the other cash payments. And for you trivia mavens, the full name of the UAW is the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America. So go impress your loved ones with that nugget after you check out the press release below.

2015 Fiat 500 Abarth automatic targets broader appeal

There aren't many manual-transmission-only offerings on the US market, and now there's one fewer. The 2015 Fiat 500 Abarth has just gone into production with a newly available automatic option.
We've known that the hair-raising, high-performance Cinquecento has been scheduled to get a two-pedal setup for some time, but now we have more specifics on the gearbox itself. According to Fiat, the six-speed automatic is derived from the same Aisin unit used in the standard 500, but it's been substantially reengineered to cope with the 1.4-liter MultiAir turbo engine's added power. Allison Singer, a vehicle integration engineer on the 500 Abarth's development program tells Autoblog that the modifications to the gearbox include "gears that have been reinforced and a few extra clutch plates," among other changes. Unfortunately, there are no paddle shifters, as the 500's steering wheel was not designed to accommodate them, but at least there's a +/- manual gate on the gearshift lever.
Interestingly, the automatic brings with it substantially different power numbers than its manual counterpart. The new model receives 157 horsepower and 183 pound-feet of torque, which is 3 horsepower less than the manual, yet it packs a whopping 13 pound-feet more torque, which should aid drivability. By comparison, the five-speed manual 2015 Abarth registers 160 hp and up to 170 lb-ft. New features that come with the auto include a dedicated sport mode, rev-matched downshifts, fuel-cut upshifts, shift logic that holds gears in corners and 'fast-off' situations, along with sharper throttle tuning. Despite the added torque, Singer admits that "The manual will probably be a tiny bit quicker as far as performance goes," but she is confident that the transmission's availability will open the car up to a much broader market of buyers.