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FCA's U.S. sales chief sues company for wrongful retaliation

Some fresh controversy is brewing at Fiat Chrysler Automobiles as The Detroit News reports that the head of U.S. sales has filed a federal whistleblower lawsuit against the company.. Reid Bigland, who's also in charge of the Ram truck brand, alleges that FCA made him a scapegoat for wrongful sales inflation practices and fixing vehicle sales statistics, which are currently under investigation by federal agents. Bigland claims that FCA executives punished him for cooperating with the federal investigators in the case by cutting his pay by more than 90 percent, according to the lawsuit he filed. The plan apparently was to use the money saved to pay for fines following any settlements made with the Securities and Exchange Commission. So far, the lawsuit alleges that FCA cost Bigland over $1.8 million in income. "They had the largest growth in retail sales in 17 years last year and refuses to pay him," Deborah Gordon, Bigland's lawyer in the case, said to The Detroit News. "Why is that? Because he participated in the SEC investigation and they don't like what he said." Bigland claims he just cooperated with the SEC investigation by testifying about FCA's sales reporting, from the time he took the position to the period prior to being appointed the company's U.S. sales chief. "In late 2018, presumably as a way to wrap up their investigation with some result, the SEC suggested to plaintiff that he admit to some wrongdoing as to defendants' monthly sales reporting," Gordon further said in a statement as part of the lawsuit. "The SEC also suggested a resolution involving some penalty to FCA. Because (Bigland) had not engaged in any wrongdoing, and there was no wrongdoing, he declined to do so." However, exacerbating the issue is the fact that Bigland reportedly sold his shares in the company last year, prompting FCA to act against him even more. FCA came under fire recently by federal agents in at least two separate investigations, potentially exposing conspiracy and corruption between company executives and private entities. The investigations are being led independently by the U.S. Attorney's Office and the FBI. So far, eight convictions were reportedly secured, with one including former Fiat Chrysler Automobiles Vice President Alphons Iacobelli, as one of the defendants. Iacobelli was one of the former top labor-relations executives for the automaker.

Amazon opens contest for The Grand Tour tickets in the US

British enthusiasts already had the opportunity to win tickets to the first taping of The Grand Tour, and now Amazon has opened up a similar chance for customers in the US. In celebration of Prime Day, which starts today, customers in the US can enter The Grand Tour Prime Day Prize Draw. The prize includes travel, $200 to spend, accommodation, and a meet and greet with Jeremy Clarkson, Richard Hammond, and James May. Customers that are interested fulfilling a childhood dream should visit Amazon's website and fill out the entry form soon as the draw closes on July 12. The Grand Tour will launch this fall as an exclusive for Amazon Prime members with the exact city locations for studio records set to be revealed later this summer. Amazon, however, did reveal that the trio will host shows in the UK, US, and Germany. So there's no need to get too upset if you don't win the draw. With Top Gear getting a major shakeup with the departure of Chris Evans, we're itching to see Clarkson, Hammond, and May behind the wheel of cars again. The trio, it seems, is also excited to get the new show rolling as Clarkson posted a drifty video on his Facebook page. The trio are currently in Italy filming a comparison between an Aston Martin DB11, a Dodge Challenger SRT Hellcat, and Rolls-Royce Dawn. The five-second clip has the Challenger Hellcat and DB11 drifting head-on into the camera crew, which is behind the wheel of an Alfa Romeo. News Source: Amazon, FacebookImage Credit: The Grand Tour TV/Movies Alfa Romeo Aston Martin Dodge the grand tour

Fiat Chrysler dumped 40,000 unordered vehicles on dealers

In a move that echoes recent history, Fiat Chrysler has been making more cars and trucks than dealers in the U.S. are willing to accept, with Bloomberg reporting that at one point the automaker had built up a glut of around 40,000 unordered vehicles. That’s led some dealers to accuse FCA of reviving the dreaded “sales bank” accounting practice of obscuring inventory to improve the balance sheet. The company reportedly began building up its inventory of unordered cars this summer despite an industrywide slowdown in sales and an eagerness by some dealers to thin their inventories because rising interest rates are making it more expensive to hold unsold cars. The inventory build-up also coincided with Fiat ChryslerÂ’s efforts to find a merger partner, first with Renault, which fell through, then last monthÂ’s announcement that it will merge with FranceÂ’s PSA Group. FCA denies any such scheme and tells Bloomberg the rising inventory is down to a new predictive analytics system designed to better square supply with demand from dealers that is helping the company save money and narrow the numbers of unsold vehicles. The company recently agreed to pay a $40 million civil penalty to the U.S. Securities and Exchange Commission to settle a complaint that it paid dealers to report fake sales figures over a span of five years. While no one is suggesting that FCA is in dire financial straits — the company saw higher than expected earnings in the third quarter and record profits in North America — the practice has strong historical precedent by Chrysler, which built up bloated inventories in the run-up to its two federal bailouts, in 1980 and 2009. It was also common at GM and Ford during the 2000s, when all three Detroit automakers struggled with excess manufacturing capacity and plummeting sales in the lead-up to the Great Recession. Back in 2012, CFO Magazine wrote about a report that explained automakersÂ’ rationale for the practice and how it works: Say fixed costs for a given factory are $100, and that the factory can make 50 cars. Consumers, however, demand only 10. Under absorption costing, if the company makes all 50 cars, its cost-per-car is $2. If it makes only up to demand, or 10 cars, the cost-per-car is $10. Although each car adds variable costs for steel and other parts, if those costs are low, the company still has an incentive to make more cars to keep the cost-per-car down.