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Marchionne: Maserati to ‘switch all of its portfolio to electrification’  

After 2019, all Maseratis will be electrified, according to FCA CEO Sergio Marchionne. It's part of a larger electrification strategy from FCA as a whole, which intends to have half of its fleet electrified by the end of its five-year plan through 2022, Marchionne said. On an earnings call last week, he said: I'll give you a couple of broad sort of indications of where we are today in terms of the delineation of the post 2018 FCA. The first one and I've mentioned this in passing and other occasions about the fact that there's nothing that will prevent an OEM from engaging in the type of development work that Tesla has done so far. We have been – as you well know, we have been reluctant to embrace that avenue until we saw a clear – a path forward. I think we're now in a position to acknowledge at least one of our brands and in particular Maserati will, when it completes the development of its next two models effectively switch all of its portfolio to electrification. It's especially significant because of FCA's feet-dragging when it comes to offering hybrid and electric vehicles. As it currently stands, Fiat offers the 500e ­– of which Sergio Marchionne has said "I hope you don't buy it" because the company loses money on them — and Chrysler offers the Pacifica Hybrid minivan, which experienced significant launch delays. While diesel is an important part of the emissions strategy for 2020 standards in Europe, Marchionne said he thinks the current situation leaves diesel in a "weaker state" as a solution. Hence the electrification push. He said, "I think what has really made the issue absolutely mandatory now is the fate of diesel and the fact that it's actually the inclusion of, especially in Europe, of some type of electrification on gas engines is inevitable." In the short term, at least, it will put pressure on prices. Though Marchionne said he's "encouraged" by the direction of battery costs, he said, "I still think that there's going to be a huge increase in prices in 2021, 2022. If effectively the electrification becomes as widespread as people expect, there has to be a shift in pricing." He also says that FCA has no intention of making its own batteries. "Given the level of knowledge and depth of that knowledge that sits with other people in the industry, what right do I have to enter that space? None." We already know what the first two plug-in vehicles from Maserati will likely be. The company plans to launch an all-electric Alfieri in 2020.

China-FCA merger could be a win-win for everyone but politicians

NEW YORK — Fiat Chrysler boss Sergio Marchionne has said the car industry needs to come together, cut costs and stop incinerating capital. So far, his words have mostly fallen on deaf ears among competitors in Europe and North America. But it appears Marchionne has finally found a receptive audience — in China. FCA shares soared Monday after trade publication Automotive News reported the $18 billion Italian-American conglomerate controlled by the Agnelli family rebuffed a takeover from an unidentified carmaker from the Chinese mainland. As ugly as the politics of such a combination may appear at first blush, a transaction could stack up industrially, and perhaps even financially. A Sino-U.S.-European merger would create the first truly global auto group. That could push consolidation to the next level elsewhere. Moreover, China is the world's top market for the SUVs that Jeep effectively invented, so it might benefit FCA financially. A combo would certainly help upgrade the domestic manufacturer; Chinese carmakers have gotten better at making cars, but struggle to build global brands, and they need to develop export markets. Though frivolous overseas shopping excursions by Chinese enterprises are being reined in by Beijing, acquisitions that support the modernization and transformation of strategic industries still receive support, and the government considers the automotive industry to be strategic. A purchase of FCA by Guangzhou Automobile, Great Wall or Dongfeng Motors would probably get the same stamp of approval ChemChina was given for its $43 billion takeover of Syngenta. What's standing in the way? Apart from price (Automotive News said FCA's board deemed the offer insufficient) there's the not-insignificant matter of politics. Even as FCA shares soared, President Donald Trump interrupted his vacation to instruct the U.S. Trade Representative to look into whether to investigate China's trade policies on intellectual property. Seeing storied Detroit brands like Jeep, Chrysler, Ram and Dodge handed off to a Chinese company would provoke howls among Trump's economic-nationalist supporters. It might not play well in Italy, either, to see Alfa Romeo and Maserati answering to Wuhan instead of Turin — though Automotive News said they might be spun off separately. Yet, as Morgan Stanley observes, "cars don't ship across oceans easily," and political considerations increasingly demand local manufacture of valuable products.

FCA cuts powertrain warranties to 60k miles

FCA US is cutting back the mileage of its powertrain warranty on some 2016 model year vehicles. Rather than the current five years/100,000 miles of coverage, the new amount is five years/60,000 miles for gasoline-fueled models from Chrysler, Jeep, Dodge and Ram. In March 2015, General Motors made a similar switch to five-years/60,000-miles of coverage for Chevrolet and GMC, and FCA US seems to be citing this as part of the reason for the shift. "Following changes already made by competitors, FCA US is adjusting powertrain warranty coverage for 2016 model year vehicles to be more consistent with industry practices," the automaker said in a portion of its statement. The bumper-to-bumper warranty for these vehicles is unchanged at three years/36,000 miles. According to Automotive News, Fiat's warranty is remaining at four years/50,000 miles. When it changed the mileage limit, GM also halved the number of free service visits for Chevy, GMC, and Buick to two from the previous four. The automaker claimed that the reason for the adjustments to its coverage was that a long warranty was seldom a reason for customers to buy a vehicle. Related Video: Response to Query: 2016MY Powertrain Warranty Adjustment Following changes already made by competitors, FCA US is adjusting powertrain warranty coverage for 2016 model year vehicles to be more consistent with industry practices. For 2016MY, Chrysler, Jeep®, Dodge and Ram Truck vehicles with gasoline engines will be covered by a 5 year/60,000 mile powertrain warranty. The basic coverage, also known as "bumper to bumper," remains at 3 years/36,000 miles. # # # News Source: FCA US, Automotive News - sub. req.Image Credit: Mark Ralston / AFP / Getty Images Chrysler Dodge Jeep RAM Car Buying Maintenance Ownership FCA warranty fca us powertrain