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SM’s message to FCA folk

by David Zatz on

Sergio Marchionne has sent out his quarterly message to the employees of FCA, a few days after the general earnings announcement. His message provided earnings in euros; we have converted to dollars based on the current rate.


Dear Colleagues,

We are off to a solid start in 2016, with substantial increases in Adjusted EBIT and Adjusted Net Profit, as detailed in our first-quarter results released today. Our improved earnings are a direct outcome of your continued perseverance in working together to build a globally competitive Group. In fact, all of our regional segments were profitable in the first quarter.

We posted net revenues of $30.7 billion [SM. wrote, “€26.6 billion” — Allpar has converted this and following euros to dollars] for the quarter, a 3 percent increase versus the same period in 2015. Adjusted EBIT came in at $1.6 billion, nearly double the prior year, with Adjusted EBIT margin at 5.2 percent. Adjusted Net Profit for the quarter was $609 million, which was $573 million higher than the same period a year ago. Worldwide shipments were approximately 1.1 million units, in line with the previous year, with a 15 percent increase in Jeep shipments.

During the first quarter, [Europe/Middle East/Africa] continued to grow market share and improve profits and margins. [North America] achieved an adjusted EBIT margin of 7.2 percent versus 3.7 percent the prior year and we remained the market leader in Canada. In [Latin America], we continued to lead the key Brazilian market and we turned an overall profit as a result of favorable vehicle mix, due to the continued ramp up of volumes from the new Pernambuco plant, manufacturing efficiencies and a reduction in marketing costs. Jeep sales increased by 17 percent in [Asia/Pacific Region], driven by the first full quarter of sales of the locally-produced Jeep Cherokee in China. With the start of production of the Jeep Renegade in China last week, we expect this upward trend to continue.

On the product side, we also started the year on a strong note, expanding the reach of all of our brands.

Jeep, which is celebrating its 75th anniversary, continued its global expansion plan and was introduced in India at the 2016 Auto Expo in New Delhi. Other highlights in the first quarter included:

  • Jeep Renegade was named “4×4 of the Year 2016” by 4×4 Magazine in the United Kingdom.
  • Production of the all-new Maserati Levante, the first SUV in the brand’s more than century-long history, started at the Mirafiori plant in Turin. With the addition of the Levante, which will be launched in Europe in May, the Maserati portfolio covers all key segments of the global luxury automotive market.
  • The Windsor Assembly Plant in Canada began production of the all-new 2017 Chrysler Pacifica minivan, which has already earned recognition on Ward’s “10 Best Interiors List.”
  • Production of the Fiat Mobi, an all-new model focused on urban mobility, started at the Betim plant in Brazil.
  • The Abarth 124 Spider debuted at the Geneva International Motor Show, providing additional performance for driving enthusiasts.

I want to thank you for your continued contribution to driving us forward. We have made a deliberate decision to set targets and pursue objectives that will assure the long-term success of FCA worldwide and never to settle for solutions that are mediocre or short-term. If we remain open-minded and committed, maintaining the agility to react rapidly to the constantly changing landscape around us, I am confident that we will succeed in continuing on our chosen path to excellence.

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