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Fiat Chrysler halts European production as coronavirus hits demand

MILAN — Fiat Chrysler Automobiles (FCA) is halting production for two weeks at most of its European plants to help protect staff against the coronavirus pandemic and adjust to a slump in demand, the Italian-American carmaker said on Monday. Italy has been the European country worst hit by the crisis and the first to enforce a nationwide lockdown, which has now been replicated by Spain and, to a lesser extent, by France as the virus sweeps through the continent. With all non essential services closed, including car dealers, and people forced home except for strict working needs, many forecast a heavy fall in car sales in March. FCA — which according to analyst estimates produces around 25% of its vehicles in Europe — said the suspensions through March 27 would allow it "to effectively respond to the interruption in market demand by ensuring the optimization of supply." Ferrari, meanwhile, said it closed its two plants until March 27. Ferrari said it had so far ensured production continuity, and it already implemented all the health measures decided by the Italian government at the two sites, in hometown Maranello and in Modena. But it was "now experiencing the first serious supply chain issues, which no longer allow for continued production." Marco Opipari, an analyst at Fidentiis, said a few weeks of closures was not a big problem in an over-supplied European auto industry and lost production could be recovered later on. "The real problem is on the demand side, people are not buying cars now, and sales volumes are expected to be very bad in March, with a real impact on automakers' earnings," he said. FCA said in a statement that production for its FCA Italy and luxury Maserati units would stop for two weeks, extending a temporary closure period already planned for some Italian facilities. Affected plants are Melfi, Pomigliano, Cassino, Mirafiori, Grugliasco and Modena in Italy, Kragujevac in Serbia and Tychy in Poland. The FIOM union said FCA's decision was "necessary". The carmaker said the freeze would help it to resume activity promptly once market conditions allow it. "The group is working with its supply base and business partners to be ready to enable our manufacturing operations to deliver previously planned total levels of production despite the suspension when market demand returns," it said.

Fiat Chrysler recalls 4.8 million U.S. vehicles for cruise control defect

WASHINGTON - Fiat Chrysler said on Friday it is recalling 4.8 million U.S. vehicles over a defect that could prevent drivers from deactivating cruise control and warned owners not to use the function until they get software upgrades. The Italian-American automaker said no injuries or crashes are related to the large recall campaign but said it had one report of a driver of a 2017 Dodge Journey rental car unable to deactivate the cruise control. Fiat Chrysler, which in 2015 was hit with penalties from U.S. regulators totaling $175 million for safety lapses, did not say how much the recalls would cost. The recall addresses what Fiat Chrysler called an "extremely rare" series of events that could lead to drivers being unable to cancel cruise control. The National Highway Traffic Safety Administration (NHTSA) said on Friday it "strongly encourages vehicle owners to follow a warning" to stop using cruise control on the recalled vehicles until repaired. NHTSA said drivers could overpower the system by forcefully applying the brakes until the vehicle stopped. Fiat Chrysler also said the vehicle could be stopped by shifting into neutral and braking. Fiat Chrysler shares fell more than 2 percent in premarket trading in New York on the recall. Fiat Chrysler noted that at times cruise control systems automatically initiate acceleration to help vehicles maintain driver-selected speeds, including when going up an incline. If an acceleration occurs simultaneously with a short-circuit in a specific electrical network, a driver could be unable to deactivate the function. Fiat Chrysler said vehicles may be placed in park once stopped, at which point cruise-control is canceled. The recall involves a group of gasoline-powered vehicles with automatic transmissions from various model years built from 2014 through the 2019 model year. Most of the vehicles being recalled cover the 2014-2018 model years. Among the vehicles being recalled are the Chrysler 200, Chrysler 300, Chrysler Pacifica, Dodge Charger, Dodge Challenger, Dodge Journey, Dodge Durango, Jeep Cherokee, Jeep Grand Cherokee, Jeep Wrangler and Ram 1500, 2500 and 3500 pickup trucks and Ram 3500/4500/5500 cab chassis trucks. Fiat Chrysler made the announcement going into the busy Memorial Day weekend, which traditionally kicks off the summer driving season.

Fiat Chrysler's Marchionne being treated in Zurich

ZURICH — Fiat Chrysler Chief Executive Sergio Marchionne was being treated in a Zurich hospital on Sunday with a serious illness after suffering complications following shoulder surgery. A Fiat Chrysler spokesman confirmed Marchionne was in Zurich's University Hospital, one of Switzerland's largest medical centers. The FCA spokesman did not give the 66-year-old Italian-Canadian executive's condition or say in which of the hospital's 43 divisions he was being treated. Italian news outlets said he has been in a coma since Friday, is breathing with the help of a ventilator, and that attempts to have him breath on his own were unsuccessful. Fiat Chrysler named its Jeep division boss Mike Manley on Saturday to take over immediately from Marchionne, who had been due to step down next April. SGS, the Swiss logistics services company, also announced on Sunday that it had named a new acting chairman to take over for Marchionne, since his illness prevented him from fulfilling the role's obligations. SGS said in a statement it was "deeply saddened" by the news, as did Lausanne, Switzerland-based Philip Morris International, where Marchionne is also on the board. Marchionne was credited with rescuing Fiat and Chrysler from bankruptcy after taking the Italian carmaker's wheel in 2004. On Saturday he was also replaced as chairman and CEO of Ferrari and chairman of tractor maker CNH Industrial — both spun off from FCA in recent years. In additional management changes linked to Marchionne's illness, Ferrari named FCA Chairman and Agnelli family scion John Elkann as new chairman and Louis Camilleri becomes chief executive. Reporting by John Miller in ZurichRelated Video: Image Credit: Reuters Chrysler Ferrari Fiat US