1966 Dodge D100 on 2040-cars

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Fiat Chrysler profit up as it closes in on retiring its debt

MILAN — Fiat Chrysler Automobiles reduced its debt by more than expected in the first quarter, putting the carmaker well on course to become cash positive later this year. Chief Executive Sergio Marchionne expects to cancel all debt during 2018 — possibly by the end of June — and generate around 4 billion euros ($5 billion) in net cash by the end of the year. Marchionne has said that forecast does not include any one-off measures, nor the impact of the planned spinoff of parts maker Magneti Marelli, which he hopes to execute by early 2019. The world's seventh-largest carmaker said on Thursday net debt had fallen to 1.3 billion euros ($1.6 billion) by the end of March, well below a consensus forecast of 2.6 billion euros in a Thomson Reuters poll of analysts. FCA said capital spending fell 900 million euros in the quarter due to "program timing," which analysts said implied higher investments for the rest of the year. The Italian-American group said first-quarter operating profit rose 5 percent to 1.61 billion euros, below a consensus forecast of 1.74 billion, as a weaker performance from its North American profit center weighed. Shipments there were higher due to the new Jeep Wrangler and Compass models. But currency moves hit revenues and earnings, and costs related to new product launches added to the pressure. FCA's shift to sell more trucks and SUVs boosted margins yet again in North America to 7.4 percent from 7.3 percent in the same quarter a year ago, although they were down from the 8 percent recorded in the preceding three months. Marchionne, preparing to hand over to an internal successor next year, is close to his goal of ending a margin gap with larger U.S. rivals General Motors and Ford. The 65-year-old has said becoming debt free and being able to compete on a par with U.S. peers would mean FCA no longer needed a partner to survive and could well succeed on its own. The CEO has previously said tying up with another carmaker would help to meet the huge costs in an industry investing in electric vehicles and automated driving. FCA shares fell immediately after the results, but recovered to trade up 3 percent at 19.71 euros by 1150 GMT, outperforming a 0.4 percent rise in Europe's blue-chip stock index. ($1 = 0.8214 euros) Reporting by Agnieszka FlakRelated Video: This content is hosted by a third party. To view it, please update your privacy preferences. Manage Settings.

FCA applies to trademark 'Hornet' and 'Dodge Hornet' names

FCA's trademark binge on March 6 isn't the only time this month that the automaker's appealed to the U.S. Patent and Trademark Office. Motor Trend discovered two applications FCA submitted on March 3, one for "Dodge Hornet," the other simply for "Hornet." The automaker requested to reserve both names in Canada and Mexico, too. The only time Dodge has ever used the Hornet name was on a chunky, four-door subcompact hatchback revealed at the 2006 Geneva Motor Show, planned for the European market with a 170-horsepower engine developed with BMW. Crowds loved the car, encouraging Chrysler to find a way to put it into production. What followed was three years of aborted platform-swapping efforts first with Chinese automaker Chery and then with Nissan before Chrysler gave up. In 2009, analysts suspected new owner Fiat might try to get a Hornet done on one of the Italian automaker's European platforms. Nothing came of that, either, FCA opting to resurrect another historical nameplate for the Dodge Dart sedan in 2011. If a new Dodge model gets the Hornet label, the best guess for a product that needs to succeed in North America is a crossover. With the Grand Caravan soon headed to pasture and the Journey expected to follow soon after, the brand will be left with a big sedan, a big coupe, and a big three-row crossover. A reborn Hornet could pick up where the concept left off, slotting into the compact space left by the outgoing Journey and where models like the Nitro and Caliber once lived. Another guess posits something a little larger, based off the Chrysler Pacifica platform, to lower development costs and increase utilization at the Windsor, Ontario, plant that builds the Pacifica and Grand Caravan. Or the Hornet could be a PSA Group model reworked into service for our market; that opens up the size choices, although PSA is moving all of its products to two platforms, both front-wheel-drive based. It's possible Dodge won't do anything with the name, the recent application nothing more than an attempt to reserve company property. Hudson reserved Hornet in 1950 for a sedan built from 1951 to 1954. After Hudson merged with Nash to form AMC, AMC used the name on a compact sedan built from 1969 to 1977. Chrysler took over AMC in 1987, letting the Hornet trademark expire in 1992.

Auto Mergers and Acquisitions: Suicide or salvation?

We love the Moses figure. A savior riding in from stage right with the ideas, the smarts, and the scrappiness to put things right. Alan Mullaly. Carroll Shelby. Lee Iacocca. Andrew Carnegie. Steve Jobs. Elon Musk. Bart Simpson. Sergio Marchionne does not likely view himself with Moses-like optics, but the CEO of Fiat Chrysler Automobiles recently gave a remarkable, perhaps prophetic interview with Automotive News about his interest and the inevitability of merging with a potential automotive partner like General Motors. Marchionne has been overtly public about his notion that GM must merge with FCA. For a bit of context, GM sold 9.9 million vehicles in 2014, posting $2.8 billion in net income, while FCA sold 4.75 million units and earned $2.4 billion in net income, painting a very rosy FCA earnings-to-sales picture. But that's not the entire picture. Most people in the auto industry still remember the trainwreck that was the DaimlerChrysler "merger" written in what turned out to be sand in 1998. It proved to be a master class in how not to fuse two companies, two cultures, two continents, and two management teams. Oh, it worked for the two individuals at both helms pre-merger. They got silly rich. And the industry itself was in a misty romance at the time with mergers and acquisitions. BMW bought Rolls-Royce. Volkswagen Group bought Bentley, Bugatti, and Lamborghini, putting all three brands into their rightful place in both products and positioning. No marriages there, so no false pretense. Finally, Nissan and Renault got married in 1999. A successful marriage requires several rare elements in this atmosphere of gas fumes and power lust. But a successful marriage requires several rare elements in this atmosphere of gas fumes and power lust, the principle part being honesty. Daimler and Chrysler lied to each other. The heads of each unit, the product planners, and finance all presented their then-current and long-range forecasts to each other with less-than-forthright accuracy. Daimler was the far greater equal and no one from the Chrysler side enjoyed that. The cultures were entirely different, too, and little was done to bridge that gap. Which brings me back to the present overtures by Marchionne to GM. "There are varying degrees of hugs," Marchionne stated in the Automotive News piece. "I can hug you nicely, I can hug you tightly, I can hug you like a bear, I can really hug you." Seriously?