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Defending Fiat

7K views 27 replies 19 participants last post by  Tin Man 2 
#1 ·
From The Detroit Free Press -
Fiat Chrysler should change its name, investor says

Should Fiat Chrysler Automobiles be called Jeep/Ram instead?

That's one piece of an investor's multi-part prescription, including spinning off Fiat to focus on North America, to boost the value of the Italian-American automaker.

But Adam Wyden's suggestions don't stop there. Wyden, of New York-based ADW Capital Management, says FCA should merge with Ford or General Motors, reflecting a long-stated pitch for industry consolidation by former FCA CEO Sergio Marchionne, who died this summer.

The suggestions came in a letter this week to the FCA board, which also recommended a spin-off of Alfa Romeo and Maserati and said FCA could expand its investor pool by issuing its financials using U.S. generally accepted accounting principles.

The Fiat brand has made some horrible mistakes in North America. Their footprint is getting smaller in the EU. Jeep and Ram can not go it alone or merged with GM and Ford as this one investors group imagines.

FCA needs to be whole. Maserati is the leading brand in for electrification, meaning they're getting most of the engineering attention for this technology. It doesn't make sense for another FCA brand to go after Tesla and the like. Besides, if all that is left is Ram and Jeep, which one should go after Tesla? Jeep is going to have plugins and EVs, but the cost and desirability for such vehicles will be a liability in the near term. Chrysler has the Pacifica PHEV, but if that brand goes away, so does that model.

The Fiat brand isn't dead. They might be comatose in North America, but operations continue to hum in the EU. Melfi builds the Jeep Renegade and Fiat 500X. Both sell well. Alfa Romeo is growing and the brand has superior vehicles to the competition. Fiat is investing a lot in its Polish manufacturing operations including the GSE line and a future BEV. The Fiat 500 BEV will be marketed as a city car, intended for the EMEA region. It might replace the current 500e as a compliance car for California, but that's not guaranteed.

The next thing to wonder about is Fiat Professional. They have a huge chunk of the market in Europe, and their vans contribute a lot to the Ram brand here. Fiat production facilities also build LCVs for the competition. It is alleged that if the sales of Ram trucks and Fiat Professional were combined they would be number two globally.

Then there is the Dodge brand. The Dodge brand must die. NY high rollers don't like having the doors of their high end imports blown off by blue collar muscle cars. That is the real reason big time NY investors want to kill FCA by the death of a thousand cuts.
 
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#3 ·
#4 ·
That deafening sound like rolling thunder we are hearing is not an approaching storm.....or even a nuclear bomb.

It's the sound of Gianni Agnelli violently thrashing in his grave!


If it were up to people like the investment group being represented in that letter, the company would have long since been sliced, diced, and sold off piecemeal to the four winds.

I'm confident in my feeling that some sort of move(s) will be taken by the company....but not one minute before John Elkann decides!
 
#6 ·
Investment analysts give the worst advice. The problem is that they've already taken a position on the company, and communicated that position to their clients, before they write one word of their "advice".

Why's he saying all this? Because he told his clients that this is what would happen. The opinion piece, like every other "analyst" piece, is part of an attempt to put the idea into the heads of other investors, so that it becomes a self-fulfilling prophecy.

I can't be the only one who noticed that his strategy for FCA, of dumping everything except UVs and Pickups in the American market, looks worryingly like the one Cerberus used to such great effect in the late 2000s. Perhaps that's how he expects the "merger" to come about, as Ford or GM pick up the remains of the company in a fire-sale when the next oil shock happens.
 
#11 ·
I think this (and other things like this) are very flattering to Sergio Marchionne's work and vision, ultimately. :)

Now, Sergio is gone. So everybody outside of FCA has got to be thinking "OPORTUNITY!" But, alas, there is no opportunity like Sergio had.

Anyhow, with a new tack(so to speak), will FCA (and it's most valuable components) continue to flourish and grow?

All over the world, the most savvy, are betting yes. And, figuring, how to get a piece of it!:rolleyes:
 
#12 ·
It’s just one of several standard schemes that circulate regularly for most large corporations. Pick the flavor of the month:
  • We need to break up a businesses into smaller, more profitable units to deliver shareholder value.
  • We need to merge companies together to deliver shareholder value.
  • We need to concentrate on "high growth regions" to deliver shareholder value.
  • We need to diversify to deliver shareholder value.
  • We need to return to our core business to deliver shareholder value.
 
#14 ·
Maybe you're right about Italy, I don't have the numbers by hand. BUT Europe wide the 500 had it's absolute record year in 2017 and also 2018 isn't too shabby in the whole lifecycle:

Text Font Line Parallel Number

Fiat 500 European sales figures (at http://carsalesbase.com/european-car-sales-data/fiat/fiat-500/ )

Also the 500L is a pretty steady seller in it's 7th year now:
Fiat 500L European sales figures (at http://carsalesbase.com/european-car-sales-data/fiat/fiat-500l/ )

Also the 500X sells pretty good this year, apart from the Euro6d dent:
Fiat 500X European sales figures (at http://carsalesbase.com/european-car-sales-data/fiat/fiat-500x/ )

Tipo sales really go down:
Fiat Tipo European sales figures (at http://carsalesbase.com/european-car-sales-data/fiat/fiat-tipo/ )
 
#15 ·
Tipo seems to have been mainly hit by WLTP: there was a major drop in sales in September and October, but take that away and the fall is in line with a car that is in its second-to-third year in the market.

And yes, 500 is down in Italy but the bigger 500X has taken its place to become Italy's #2 selling car. The top four are:

1. Panda: 77k
2. 500X: 40k
3. Renault Clio: 37k
4. 500

( 2018's most popular cars in Europe – by country | Autocar (at https://www.autocar.co.uk/car-news/industry/2018s-most-popular-cars-europe-–-country ) )

..and who would guess that Lithuania was such a strong market for FIAT? #1,#2, and #3 sold are FIAT 500, Tipo, 500X. So much for cold-climate countries not liking Italian cars...

One last comment on that article: Hyundai's "success" in the Irish market is because they've flooded the daily-rental fleets, and are the biggest abuser of the "one-owner, 0km" registration scam. You'd have to be an idiot to buy a new Hyundai or Kia when there are so many six-month-old models around...
 
#18 ·
why do they sell this ancient Panda, it hurts the image of whole group
It certainly does not. The Panda is a brilliant, no frills, perfect city car, ideal for medieval towns and cities, narrow mountain roads, and with four wheel drive an astonishingly capable little car. Panda owners generally love their cars. Millions and millions of sales attest to that. How can that hurt the image.
Maybe not the perfect car to go in from Helsinki to Karasuando, but there is a big world out there!!
 
#19 ·
At launch, that Panda scored 4 Stars - the highest rating for a city car that year (Official Fiat Panda 2011 safety rating results (at https://www.euroncap.com/en/results/fiat/panda/10970 )). The safety equipment has been improved since then, but what you're seeing is the effect of EuroNCAP completely changing its testing and scoring system since 2011. The car is as safe in a collision today as it was at launch.

I don't think that newer cars in the class are so much safer than Panda as a difference between five and zero stars would suggest, just that those cars were designed with the post-2015 test program in mind. The score is also based on lowest-available specification, and this hurts carmakers like FIAT who sell lower-priced models. Compare the 500 and Panda's scores to see just how much this matters: structurally, Panda and 500 are the same car, but last year, a re-test of the 500 scored 3 stars. The difference was that, in 2016, 500 had a refresh that made some safety equipment standard across the range; something Panda didn't get.

I'm unhappy that driver aids (e.g., autonomous braking), cabin labelling and driver instructions contribute to the headline score on what is at heart, supposed to be a crash-safety test. I'd prefer to see automated systems, or the presence/absence of seatbelt indicators, scored separately to the core crash-safety. All the Lane-Departure-Warnings in the world won't help you if you're struck head-on by a car that veered into your lane, and Autonomous braking does not function at the speed used in the impact tests (nor does it have any bearing on side or pole impacts).
 
#21 ·
At launch, that Panda scored 4 Stars - the highest rating for a city car that year (Official Fiat Panda 2011 safety rating results (at https://www.euroncap.com/en/results/fiat/panda/10970 )). The safety equipment has been improved since then, but what you're seeing is the effect of EuroNCAP completely changing its testing and scoring system since 2011. The car is as safe in a collision today as it was at launch.

I don't think that newer cars in the class are so much safer than Panda as a difference between five and zero stars would suggest, just that those cars were designed with the post-2015 test program in mind. The score is also based on lowest-available specification, and this hurts carmakers like FIAT who sell lower-priced models. Compare the 500 and Panda's scores to see just how much this matters: structurally, Panda and 500 are the same car, but last year, a re-test of the 500 scored 3 stars. The difference was that, in 2016, 500 had a refresh that made some safety equipment standard across the range; something Panda didn't get.

I'm unhappy that driver aids (e.g., autonomous braking), cabin labelling and driver instructions contribute to the headline score on what is at heart, supposed to be a crash-safety test. I'd prefer to see automated systems, or the presence/absence of seatbelt indicators, scored separately to the core crash-safety. All the Lane-Departure-Warnings in the world won't help you if you're struck head-on by a car that veered into your lane, and Autonomous braking does not function at the speed used in the impact tests (nor does it have any bearing on side or pole impacts).
Not only that but safety assists systems are directly related to Adult Safety score. WTF!? :eek:
 
#25 ·
That argument comes up a lot, but I don't see the evidence. Here, I don't see anyone attacking the agency, and nobody has claimed that EuroNCAP has it in for FCA, or that the test was unfair or improperly conducted. I'm sure other car makers have had their models re-tested too.

This thread is about FIAT, so I didn't mention Wrangler's result, but I will now: The Wrangler's 1-star EuroNCAP result is appalling, and stupid for a vehicle that was given the engineering investment to carry a diesel engine specifically to be competitive in the European market. Someone, and more than one person, at FCA needs to answer for how they allowed this product to launch in Europe knowing that it would get this result (and it's very easy to simulate the various test procedures, so I don't know how this was a surprise). EuroNCAP tests several vehicles, and where there's a large divergence or a serious problem, they will approach the manufacturer and let them have a second go... BMW's X5 got a 5-star result despite a knee-bag not firing because BMW supplied evidence that it did fire in other tests. There's no excuse for a new vehicle scoring one star in EuroNCAP. None. All that said, EuroNCAP have some blame too: their agency did not conduct a pole-impact test on the vehicle (it says so in the comments for the Adult impact test), so Wrangler lost points in both passenger impact tests simply because one of the impact tests wasn't performed (it scored full points in the large-profile side-impact test).

The Panda result is not the same. It's not a new car. It has not even been revised recently. This was a random re-test, of the kind EuroNCAP does sometimes. The low score is simply a sign of the rules moving on and the low entry price of the model, as I outlined in my previous post. However, I think that there is something needlessly sensationalist in any scoring system where in only seven years you can go from an 80% score (highest in segment that year) down to a 0% score without the product design changing (except for the addition of some safety options). "Zero star" suggests that the vehicle is not roadworthy. Either the car was safe at launch and remains exactly that safe now, or it was not safe at launch and should not have been awarded a high score at the time.

Here's the breakdown of Panda's scores from its two tests (Adult in impact, Child in impact, Pedestrian, Safety Tech), and the decline isn't as dramatic:
2018: 45% 16% 47% 7% Headline: 0/5
2011: 82% 63% 49% 43% Headline: 4/5

For completeness, here's Wrangler:
2018: 50% 69% 49% 32% Headline: 1/5

The Adult and Child scores come from barrier and pole impact tests which have been significantly up-rated in recent years, hence the fall in score. Pedestrian testing is largely unchanged, as you can see from the scores (a 2% change is not significant given the randomness in the test procedure itself).
Including the Tech score in the overall rating is where I do have a criticism of EuroNCAP's scoring system - this is a mission-creep away from its original goal, which was to get car makers to improve the survivability of impacts.

I'd like two scores: an impact safety score, and a preventative score, which would make things clearer. I know three people who've been in accidents bad enough to require a hospital visit in the last ten years: two were side-impacts from drivers running a red-light , the third had his car flipped when a blown-out front tire caused him to hit a curved barrier at just the wrong angle. No emergency braking system, lane departure warning or seatbelt reminder (seatbelts are compulsory over here) would have helped any of them. There's more than one way of getting a high score, and I'd prefer that manufacturers focussed on impact survivability.
 
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