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Marchionne completed Fiat-Chrysler deal from a Florida beach

Sergio Marchionne is the CEO of Fiat, which as you may have heard, has finally worked up a deal to finish acquiring the Chrysler Group after months of bargaining with the United Auto Workers and its VEBA healthcare trust, which owned just over 40 percent of the American brand. Where was Marchionne when the deal was finally hammered out? Well, not tucked away in a frigid Detroit board room until the wee hours of the morning.
Nope, one of the largest deals in automotive history was reportedly hammered out on the beach - at the home of a banker, in the Florida resort town of Vero Beach. Marchionne traveled to the home of Alain Lebec, a senior managing director at Brock Capital LLC, one of the advisory companies for the VEBA fund, where both sides met to make final arrangements in the $4.35-billion exchange. The location of the final deal, though, is nearly as remarkable as the pace with which it came about.
According to anonymous sources pinned down by Automotive News Europe, before the meeting, the two sides were meeting in Detroit as recently as December 19, which is where Fiat made one of its final revised offers. Naturally, the VEBA made a counter offer, which led Marchionne to initiate the Vero Beach meeting.

Automakers not currently promoting EVs are probably doomed

Okay, let's be honest. The sky isn't falling – gas prices are. In fact, some experts say that prices at the pump will remain depressed for the next decade. Consumers have flocked to SUVs and CUVs, reversing the upward trend in US fuel economy seen over the last several years. A sudden push into electric vehicles seems ridiculous when gas guzzlers are selling so well. Make hay while the sun shines, right? A quick glance at some facts and figures provides evidence that the automakers currently doubling down on internal combustion probably have some rocky years ahead of them. Fiat Chrysler Automobiles is a prime example of a volume manufacturer devoted to incremental gains for existing powertrains. Though FCA will kill off some of its more fuel-efficient models, part of its business plan involves replacing four- and five-speed transmissions with eight- and nine-speed units, yielding a fuel efficiency boost in the vicinity of ten percent over the next few years. Recent developments by battery startups have led some to suggest that efficiency and capacity could increase by over 100 percent in the same time. Research and development budgets paint a grim picture for old guard companies like Fiat Chrysler: In 2014, FCA spent about $1,026 per car sold on R&D, compared with about $24,783 per car sold for Tesla. To be fair, FCA can't be expected to match Tesla's efforts when its entry-level cars list for little more than half that much. But even more so than R&D, the area in which newcomers like Tesla have the industry licked is infrastructure. We often forget that our vehicles are mostly useless metal boxes without access to the network of fueling stations that keep them rolling. While EVs can always be plugged in at home, their proliferation depends on a similar network of charging stations that can allow for prolonged travel. Tesla already has 597 of its 480-volt Superchargers installed worldwide, and that figure will continue to rise. Porsche has also proposed a new 800-volt "Turbo Charging Station" to support the production version of its Mission E concept, and perhaps other VW Auto Group vehicles. As EVs grow in popularity, investment in these proprietary networks will pay off — who would buy a Chevy if the gas stations served only Ford owners? If anyone missed the importance of infrastructure, it's Toyota.

Fiat Chrysler's Q3 profit boosted by strong North American earnings

MILAN, Italy — Fiat Chrysler Automobiles (FCA) reported a 17 percent jump in third-quarter adjusted operating profit on Tuesday, helped by a strong performance in its key North American market and improving operations in Europe and Latin America. The world's seventh-largest carmaker still makes the lion's share of its profits in North America, so improving, or at least maintaining, its margins there is a key focus. The carmaker reported an 8 percent adjusted operating profit margin in the region, up from 7.6 percent a year ago, despite a drop in sales and shipments. "FCA's profitability in North America remained strong in the quarter despite a weakening market there," a Milan-based analyst said. FCA's profitability compares with an 8.3 percent North America margin reached in the quarter by bigger U.S. rival GM , showing CEO Sergio Marchionne making progress towards his goal of closing the margin gap with GM and the company's other U.S. rival, Ford, by 2018. The company's confirmation of its full-year outlook also pushed shares higher, a trader added. The stock was up 2.8 percent by 1129 GMT, outperforming a 1 percent rise in the European auto index. FCA has been retooling some U.S. factories to boost output of sport-utility vehicles (SUVs) and trucks while ending production of some unprofitable sedans to strengthen profitability as the U.S. car market comes off its peak. The company said a drop in North America shipments due to lower fleet sales and discontinued models was partially offset by higher deliveries of Ram trucks and two models from the Alfa Romeo stable: the Stelvio sport utility vehicle and Giulia sedan. Profitability also improved in Europe, helped by sales of the Stelvio and the new Jeep Compass, and Latin America, while margins at Maserati remained strong at 13.8 percent due to strong demand for its first SUV, the Levante. In a later conference call, investors are looking for hints on the new strategy to 2022 which the company promised to unveil early next year. Chief Executive Sergio Marchionne said earlier this year that FCA would streamline its portfolio and that components businesses, including Magneti Marelli, would be separated from the group, possibly via a spin-off. While FCA confirmed its targets this year, doubts remain about its exposure to a weakening U.S. market, recall costs and potential fines over emissions after it was targeted by European and U.S.