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Stellantis won't race to split electric vehicles from fossil fuel cars

MILAN - Stellantis is not considering splitting its electric vehicle (EV) business from its legacy combustion engine operation, its finance chief said on Thursday, as the carmaker presented above-expectation revenue data for the first quarter. Chief Financial Officer Richard Palmer told analysts he did not see huge benefits in the kind of separations pursued by rivals such as France's Renault and U.S. Ford. "We need to manage the company and the assets we have through this transition," he said. "There are benefits to having the cash flow being generated by the internal combustion business for the investments we need to make." Palmer said the group, formed by a merger last year of Fiat Chrysler and Peugeot maker PSA, was not averse to considering adjusting its structure "but we aren't anticipating any big changes." Palmer's comments came after the world's fourth largest carmaker said its net revenue rose 12% to 41.5 billion euros ($44.1 billion) in the January-March period, as strong pricing and the type of vehicles sold helped offset the impact of the semiconductor shortage on volumes. That topped analyst expectations of 36.9 billion euros, according to a Reuters poll. Milan-listed shares were up 0.5% by 1415 GMT, in line with Italy's blue-chip index. The impact of the chip crunch was evident in the decline in shipment figures which fell 12% in the quarter to 1.374 million vehicles. It was a similar story for Germany's BMW which posted higher revenues on Thursday and a decline in car sales. Riding the Recovery Stellantis, whose brands also include Citroen, Jeep and Maserati, confirmed its 2022 forecasts for a double-digit adjusted operating income margin, after 11.8% last year, and a positive cash-flow despite supply and inflationary headwinds. Morgan Stanley analysts said after the results that Stellantis had better management than many peers and benefited from its significant exposure to a stronger U.S. economy and a European recovery from the COVID-19 pandemic. They also said it was less affected by a slowing Chinese economy. Palmer said it was important for the group to maintain double-digit margins and keep delivering positive cash flows. "A 12% increase in revenue with a 12% decrease in volumes indicates a very strong performance on price and mix, which augurs well for our margin performance," he said. He said semiconductor supply problems were expected to ease this year with continued improvements in 2023.

Detroit automakers keep their masks on to keep the factories running

United Auto Workers members leave the Fiat Chrysler Automobiles Warren Truck Plant in May. Fiat Chrysler along with rivals Ford and General Motors Co., restarted the assembly lines after several weeks of coronavirus lockdown. (AP)   DETROIT — When the coronavirus pandemic slammed the United States in March, the Detroit Three automakers shut their plants and brought their North American vehicle production to an unprecedented cold stop. Now, four months after a slow and sometimes bumpy restart in May, many General Motors, Ford and Fiat Chrysler Automobiles  factories are working at close to full speed, chasing a stronger-than-expected recovery in sales. So far, none of the Detroit Three has had a major COVID-19 outbreak since restarting production, even as the coronavirus is surging in Midwestern and Southern communities outside factory walls. "We have people testing positive, but it's not affecting operations," said Ford global manufacturing chief Gary Johnson. Keeping the pandemic at bay has pushed the automakers and 156,000 U.S. factory employees represented by the United Auto Workers into unfamiliar work routines and extraordinary levels of cooperation among the rival automakers that will have to be sustained for months to come. For automakers, the automakers' COVID response has been as much about instilling new habits as relying on new technology. Workers log their symptoms, or lack of them, into smartphone apps and walk past temperature scanners to get to their work stations. But company and union executives said masks, along with physical distancing, are the key to keeping assembly lines rolling. "The mask is the foundation" of protecting workers on the job, said Johnson. Complaints about masks Autoworkers are accustomed to wearing protective gear such as shatterproof glasses and gloves. Masks that cover the mouth and nose, however, were not standard equipment on auto assembly lines, and were a tough sell at first. "The biggest complaint is wearing a mask," United Auto Workers President Rory Gamble told Reuters. "A lot of our members perform physical tasks. Wearing the mask inhibits breathing." Beyond that, Gamble said, masks and distancing make it harder for workers to have conversations on the job or socialize during breaks. "ThatÂ’s pretty much out the window, and it makes for a longer day," he said. Masks make it harder for co-workers to read each other's expressions — often crucial in the noisy environment of a car plant.

Chrysler stays IPO until 2014

There will not be a Chrysler IPO in 2013. Fiat, according to a report from Forbes, has announced that it will not be able to make the American brand's initial public offering before the end of the year, saying that the short, five-week window that makes up the rest of 2013 is "not practicable."
Not surprisingly, the issue with the Chrysler IPO is the same as it's always been - a disagreement between parent company Fiat, which owns 58.5 percent of the Chrysler Group and a UAW healthcare trust, which owns 41.5 percent. Fiat wants to buy out the UAW VEBA healthcare trust, which is responsible for shouldering retiree healthcare costs, but the two sides are hung up on an actual price tag for the remaining two-fifths of the company.
The original idea saw an IPO as a way of setting a fair market price for the remaining shares, although it's not entirely clear what broke down and led to a delay of the IPO plan. As Forbes points out, by waiting until 2014, Chrysler could be risking a cool-off in the IPO market, which could mean less money in its pocket when the automaker finally goes public.