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Automakers are getting nervous about Europe's economy

Carmakers BMW and Stellantis on Thursday expressed concerns about Europe's economic outlook, joining a chorus of retailers and others in warning of waning consumer confidence on the continent and hitting their shares. "Obviously the macro(-economic situation) in Europe is more challenging, which gives me pause, personally," Stellantis chief financial officer Richard Palmer said on a conference call with analysts. "If there was anywhere where I was more concerned, it would be Europe than anywhere else really based on the macro." This follows a dire assessment of consumer sentiment in Europe from the likes of consumer goods company Unilever and news of lower spending by Europeans from Amazon. Like other major auto companies, Stellantis and BMW have been hit by supply chain disruptions stemming from the global coronavirus pandemic that have curtailed car production. They have also benefited from strong consumer demand amid low vehicle supply, allowing them to raise prices and keep them high even as the semiconductor shortage shows signs of easing. BMW posted a 35.3% jump in third-quarter revenue despite a small drop in vehicle sales. Stellantis said its revenue rose 29% on the back of a 13% increase in vehicle sales as more semiconductors became available. The concern among analysts has been that demand may falter, just as carmakers get their hands on the supplies they need, undermining pricing and hurting profits. But this week Ferrari said it was confident about its prospects for this year and 2023 as demand for its luxury cars, as well its pricing power, remained strong. Both BMW and Stellantis said on Thursday they had vehicle order books that stretched into the second quarter of 2023. But BMW's chief financial officer Nicolas Peter said high inflation and rising interest rates could hit buyers' wallets. "This is causing conditions for consumers to deteriorate, which will affect their behaviour in the coming months," he said. "We therefore continue to expect our higher-than-average order books to normalise, especially in Europe." He added customers had been unhappy about the wait for new cars, so "a slight reduction (in orders) would not be negative." Palmer said Stellantis was "ready for any softness in demand" but in the short term had been affected by a shortage of drivers to deliver its cars to dealers. "At the moment, we can't build enough cars," he said.

Fiat set to invest $12B on new models, stop Euro losses in 3 years

Naturally, you'd expect a massive automaker like Fiat to have an in-depth plan to exit the current European-market doldrums, and you'd expect that plan to include plenty of new vehicles to attract those precious buyers that still remain despite the financial downturn. And you'd be right, though Fiat does seem to have a few unexpected twists up its corporate sleeve.
Perhaps the biggest shocker is a report that Fiat will completely drop the Punto, a car with mass-market appeal aimed at small-car buyers cross-shopping the popular Volkswagen Polo. Its replacement will be a five-door Fiat 500 aimed at upmarket buyers (sounds awfully similar to the 500L) that will be built in Poland. Lower-end customers will reportedly be served by variants of the Fiat Panda.
Borrowing a page from the BMW, Daimler and Volkswagen playbook, reports Automotive News, Fiat is said to have plans to reignite production at its Italian factories by retooling them to build high-end vehicles from Maserati and Alfa Romeo. These will be marketed as premium products, built by skilled Italian workers (who are paid wages that are 75-percent higher than those building Fiats in Poland), and will be sold around the world.

Macron and Le Pen decry 'shocking' Stellantis CEO pay

PARIS — French President Emmanuel Macron and his far-right challenger in the French presidential vote, Marine Le Pen, on Friday both decried as “shocking” the multimillion euro payout to the CEO of carmaker Stellantis. Stellantis CEO Carlos TavaresÂ’ remuneration package of 19.15 million euros just a year after the company was formed became an issue as Macron and Le Pen campaigned ahead of the April 24 runoff vote. Polls show purchasing power and inflation are a top voter concern. Stellantis was formed last year through the merger of PSA Peugeot and Fiat Chrysler Automobiles. Centrist President Emmanuel Macron, perceived by many voters as being too pro-business, called the pay package “astronomical” and pushed for a Europe-wide effort to set ceilings on “abusive” executive pay. “ItÂ’s shocking, itÂ’s excessive,” he said Friday on broadcaster France-Info. “People canÂ’t have problems with purchasing power, difficulties, the anguish theyÂ’re living with, and see these sums. Otherwise, society will explode.” Far-right leader Marine Le Pen, who enjoys support from many working-class voters, called for bringing in more workers as shareholders. “Of course itÂ’s shocking, and itÂ’s even more shocking when it is the CEOs who have pushed their society into difficulty,” she said Friday on BFM television. “One of the ways to diminish this pay, which is often out of proportion with economic life, is perhaps to allow workers in as shareholders.” Stellantis continued to back the package despite a 52.1% to 47.9% vote rejecting it at an annual shareholders' meeting chaired from the Netherlands, where the company is legally based, on Wednesday. The company, citing Dutch civil code, noted that the vote is advisory and not binding. The company later said in a statement that it took note of the vote, and will explain in an upcoming 2022 remuneration report “how this vote has been taken into account.” In the 2021 report, the company identified peer group companies that it used as a salary benchmark, including U.S. companies like Boeing, Exxon Mobile, General Electric as well as carmakers Ford and General Motors. Stellantis, whose brands include Peugeot, Fiat, Jeep, Opel and Maserati, reported net profits last year had tripled to 13.4 billion euros ($15.2 billion). The French government is the third-largest shareholder in Stellantis, with a 6.15% stake through the Bpifrance Participations S.A. French public investment bank.