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Fiat Chrysler's profit boosted by Ram and Jeep in North America

MILAN/DETROIT — Fiat Chrysler took the market by surprise by sticking to its full-year profit guidance on Wednesday after a strong performance from its Ram pickup truck in North America helped it defy an industry slowdown. Chief Executive Mike Manley, in FCA's first earnings release since a failed attempt to merge with France's Renault, also left the door open to that or other deals. "We are open to opportunity," Manley said on a call with analysts. "I have no doubt why there still would be interest in it," he added, when pressed on what it would take to revive talks with Renault. Manley declined to comment further. FCA last month abandoned its $35 billion merger offer for Renault, blaming French politics for scuttling what would have been a landmark deal to create the world's third-biggest automaker. Manley said a merger was not a must-have and Fiat Chrysler's business plan was strong. The company said it remained confident its adjusted earnings before interest and tax (EBIT) would top last year's 6.7 billion euros ($7.5 billion). Given disappointing forecasts from other automakers this earnings season, FCA's confirmation of the outlook sent Milan-listed shares in the Italian-American automaker, whose other brands include Jeep, up over 4%. A broad-based auto sales downturn has rattled the sector, forcing FCA's competitors — including Renault, Daimler and Aston Martin — to cut their sales forecasts after second-quarter results, while U.S. carmaker Ford gave a weaker-than-expected 2019 profit outlook. Japan's Nissan, a long-term partner of Renault, said it would cut 12,500 jobs by 2023 after its earnings collapsed. In the second quarter FCA's adjusted EBIT totaled 1.52 billion euros, versus analysts' expectations of 1.43 billion euros, according to a Reuters poll. 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 pickup truck market of 27.9%, up 7 percentage points from last year. Adjusted EBIT margin in North America rose to 8.9% from 6.5% in the first quarter, thanks to strong demand for the heavy-duty Ram and the new Jeep Gladiator pickup. Chief Financial Officer Richard Palmer also said FCA expected to report up to 10% margins in the region in both the third and fourth quarters.

Maserati says no to all-electric future, says U.S. chief

The future internal combustion remains questionable as automakers push for electrification. But not for Maserati, according to a report from Motor Trend on an investor call discussing first-quarter earnings. According to the outlet, FCA CEO Michael Manley and Maserati North America's head honcho, Al Gardner, made it known on the call that Maserati does not have any plans to say goodbye to good 'ol gasoline power. Rather, the company is planning to embrace electrification in different ways, such as hybridization. "This is a brand that needs combustion engines. It needs that raw emotion," Gardner told reporters at the conference. He also noted it's important for the company to get "back to its roots," citing the company's start with race cars before offering consumer vehicles. Maserati's electrification will begin as part of its model line overhaul leading up to 2022 that is also supposed to help reverse Maserati's slumping sales. Gardner noted that a new sports car will mark the start of the revamp, and we expect it will be a production version of the hotly anticipated and very sexy Alfieri Concept car. We may even see the car at Geneva next year. After that will be a new crossover smaller than the Levante, along with hybrid and plug-in hybrid variants with a few select electric vehicles. Maserati won't be the only automaker embracing electrification, as Jaguar, Volkswagen and Porsche are all pushing toward the new powertrain technology. Unlike Maserati, some of these brands are going all-in on electric cars. Volkswagen will release its last new internal combustion engine in 2026. Volvo's Polestar brand will only have pure EVs after the Polestar 1 sports car.

Maserati Levante SUV may be built in Italy after all

In July Fiat halted its investments in Italy, putting on hold plans for the Maserati Levante SUV to be built at the automaker's flagship factory in Turin. But Fiat CEO Sergio Marchionne, whose company owns Maserati, met with unions on Wednesday, and he may announce plans to move forward with production of the SUV at the Mirafiori factory if the CEO and the unions reach an agreement, Bloomberg reports.
Marchionne is reportedly about ready to build new cars at Fiat's largest and oldest factory, on the grounds that 5,300 workers accept extended temporary layoffs through most of next year in a slowing European auto market. If unions don't accept the deal, it's not clear whether Fiat would still consider building the Levante at Mirafiori or not.
The Levante, Maserati's first SUV, is based on the Jeep Grand Cherokee platform, and we reported two years ago that it would be built in Detroit next to its Jeep cousin. Obviously those plans have been altered considerably in the intervening period of time.