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LONDON/DETROIT (Reuters) - Former Fiat Chrysler (FCHA.MI) Chief Executive Sergio Marchionne for more than a year assured investors that he and the automaker’s board were working on an orderly succession plan ahead of his expected departure in 2019.
But a health crisis that left 66-year-old Marchionne incapacitated in a Swiss hospital set off a transition last week that was sudden and rushed, banking and industry sources said. The company announced on Wednesday that Marchionne had died, succumbing to complications from surgery.
It emerged that Marchionne’s successor was far from settled. Indeed before last week’s crisis, many company executives remained in the dark, four banking sources who spoke to Fiat Chrysler executives told Reuters.
The scramble to replace Marchionne led to the resignation of a senior executive who was passed over for the top job, the sources said, and exposed fissures between the Italian and North American sides of the world’s seventh-largest automaker.
Fiat Chrysler Chairman John Elkann named Michael Manley, head of the company’s Jeep and Ram truck divisions, to replace Marchionne at an emergency meeting in Turin, Italy on Saturday. In doing so, Elkann followed Marchionne’s wishes to appoint Manley his successor, two sources said.
The company has portrayed Manley’s appointment as the product of lengthy deliberation.
“Sergio and John have always been totally aligned on the choice of Mike Manley,” Fiat Chrysler’s main spokesman Mike Keegan said on Tuesday, when asked whether there were differences over the succession.
Elkann’s office declined to comment. Manley could not immediately be reached for comment.
This description diverges from what Marchionne himself told investors on June 1 during a day-long strategy presentation in Balocco, Italy.
Marchionne said that he and Elkann “from time to time have these chats” about succession, but the issue would not be decided until next year.
“It’s a 2019 issue,” Marchionne said. “So it’s not going to happen until we close ‘18. It just won’t happen.” He went on to say that the company’s board would not engage in a “rubber stamp process.”
Some analysts have also expressed skepticism that a final decision had been made.
“My view is Marchionne and Elkann were still arguing about succession and had different views on the right candidate,” Sanford Bernstein analyst Max Warburton said in a note on Monday, referring to the June 1 presentation.
Sources close to the company said they believed two other candidates - Fiat Chrysler chief financial officer Richard Palmer and Europe chief Alfredo Altavilla - had been in the running to replace Marchionne and that Elkann was also exploring an “Italian solution” by naming an Italian-born CEO.
Altavilla, 54, quit after being told of Manley’s appointment on July 21, one of the sources said.
A company veteran who joined Fiat in 1990, Altavilla took charge of the group’s struggling European operations in 2012 and returned them to profit three years later.
Altavilla pressed Elkann to give him the top job on July 20 when it became clear that Marchionne would not come back to work, three sources familiar with the situation said.
“For Altavilla it was too important - he wants to be CEO atleast once in his career,” one of the sources said.
Altavilla declined to comment.
MAJOR VOID
Marchionne underwent shoulder surgery in late June. The company said on July 21 that Manley would take over after Marchionne’s condition took a sudden turn for the worse. The company has not provided details on Marchionne’s illness.
Under the best of circumstances, Marchionne’s pending departure presented Fiat Chrysler with a major void to fill. Regarded as a savior of Fiat, Italy’s automotive champion, the Italian-born Marchionne set in motion the marriage between Fiat and bankrupt U.S. rival Chrysler just over a decade ago.
For the past several years, Marchionne had tried to engineer a merger or alliance between Fiat Chrysler and another automaker, driven by the view that car companies were developing too much duplicate technology in the chase for cleaner engines and electric cars. That ultimate deal eluded him.
Jetting between the company’s offices and design studios in Europe and the United States, Marchionne dominated Fiat Chrysler, eclipsing the executives under him.
A native of Italy who grew up in Canada, Marchionne acted as a bridge between the company’s Italian and American sides. He could parry questions from the Italian press in one press conference, and deliver sly put-downs of his rivals in English during the next.
Marchionne was a powerful advocate for the automaker’s Italian cars and brands, and said he would not restructure the company to leave a “stump” company in Italy that could not survive.
Fiat Chrysler reported second quarter financial results on Wednesday, and the scheduled call with analysts will be Manley’s first official step onto a public stage as CEO.
Manley runs the two brands, Jeep and Ram, that generate most of the group’s profit. Born in Britain and based at the former Chrysler headquarters in suburban Detroit, Manley is expected by bankers and analysts at least initially to follow a five-year plan laid out by Marchionne and other executives in June.
As Fiat Chrysler heads into what most industry executives and analysts predict will be a difficult 2019, the automaker’s Italian brands have lost a powerful champion with Marchionne’s departure.
DETROIT— Fiat Chrysler Automobiles NV on Wednesday reported a second-quarter profit decline of 35% and cut guidance on a number of targets for the full year, marking a rocky start to the tenure of its new chief executive.
The lower-than-expected earnings sent the company’s stock price sliding and came hours after Fiat Chrysler said former CEO Sergio Marchionne had died of complications from surgery.
CEO Mike Manley, who took over from Mr. Marchionne on Saturday, said the results show the challenges facing the company, but committed to achieving targets Fiat Chrysler set out last month in a new five-year business plan. That strategy was outlined by Mr. Marchionne, who had planned to step down as CEO next year.
“My intention is to deliver the plan as a strong, independent FCA,” Mr. Manley said on a conference call with analysts, indicating the Italian-American company wasn’t looking to merge with another auto maker or sell itself.
Blaming in part a quarterly loss at its Asian business from weak sales in China, Fiat Chrysler said net profit for the quarter ended June 30 was €754 million ($881 million), down from €1.16 billion the same period a year ago.
Adjusted operating profit, which strips out one-time items, fell 11% to €1.66 billion from €1.87 billion a year earlier. That was below a consensus forecast among analysts of €2.1 billion.
The company was hurt most by poor performance in the Asia Pacific region, where it posted an adjusted loss of €98 million on weak demand in China for locally-made sport-utility vehicles and price increases from import duties.
“It’s obvious China is clearly a priority for me in the coming weeks,” Mr. Manley said, adding he has high expectations for a newly launched luxury SUV exclusive to the Chinese market called Jeep Grand Commander.
Fiat Chrysler’s manufacturing problems with a new pickup truck launched earlier this year in the U.S. are “largely behind us,” Mr. Manley said, adding full production volumes would be reached by year’s end. The redesigned Ram 1500 truck is a key product for the company because of the high profit margins it generates.
Problems ramping up the production of the new truck cost the company about €300 million in each of the first two quarters, but those expenses will be “substantially reduced” this quarter and eliminated by year’s end, said Richard Palmer, the company’s chief financial officer.
Mr. Palmer also said he expected prices for commodities such as steel to continue to rise over the next year, but noted that the company had fixed price contracts this year and had built those higher price expectations into its 2019 plan.
Fiat Chrysler confirmed its adjusted net profit target for the full year but lowered its outlook for revenue and adjusted operating profit. The company now forecasts 2018 revenue between €115 billion and €118 billion, compared with about €125 billion previously.
The auto maker cut its guidance for adjusted operating profit to between €7.5 billion and €8 billion, against a previous forecast of at least €8.7 billion.
Fiat Chrysler said it met a key target of swinging to net industrial cash of €456 million as of the end of June, compared with net debt of €1.31 billion at the end of March. Revenue increased 6% to €29 billion.
Fiat Chrysler Warns of $800 Million in Costs Related to Emissions Settlement
Jan. 10, 2019
Fiat Chrysler Automobiles NV will spend up to $800 million to settle allegations that it used so-called defeat devices to pass emissions tests.
The auto maker said Thursday it agreed to pay around $400 million to federal regulators and states, and expects payments to customers, future warranty costs and mitigation efforts may cost an additional $400 million to fix an estimated 100,000 vehicles.
The company said it didn’t admit to any environmental violations under the settlement and said there was no “deliberate scheme to install defeat devices to cheat emissions tests.”
“We acknowledge that this has created uncertainty for our customers, and we believe this resolution will maintain their trust in us,” said Mark Chernoby, Fiat’s head of North American safety and regulatory compliance.
The Justice Department sued Fiat Chrysler in 2017, claiming illegal software installed on Jeep Grand Cherokee SUVs and Ram pickup trucks from the 2014 to 2016 model years to evade pollution controls. The government claims the company violated the Clean Air Act by allowing the vehicles to pollute more than 20 times beyond the legal limit.
The Justice Department said Thursday that Fiat will pay a $305 million civil penalty.
Fiat Chrysler deceived consumers and the federal government by installing defeat devices on these vehicles that undermined important clean air protections,” said Andrew Wheeler, acting administrator of the Environmental Protection Agency.
The total settlement includes a $6 million civil penalty for illegally importing 1,700 noncompliant vehicles.
The allegations against Fiat Chrysler came in the wake of a scandal involving Volkswagen AG’s use of illegal devices to cheat emissions tests on nearly 600,000 diesel-powered vehicles cars in the U.S. VW in 2017 pleaded guilty to criminal charges and has paid more than $20 billion in legal settlements and fines.
Fiat Chrysler recalls 862,000 cars for emission violations
March 13, 2019
Washington — Fiat Chrysler Automobiles US LLC is recalling nearly 900,000 vehicles that don't meet U.S. emission standards.
The U.S. Environmental Protection Agency announced Wednesday that Fiat Chrysler is voluntarily recalling 862,520 cars as a result of "in-use emissions investigations" conducted by both the agency and the company. Those investigations, designed to measure the effectiveness of emission control systems in cars after some time on the road, revealed the vehicles were not meeting federal emission standards.
Fiat Chrysler said in a statement the EPA announcement "reflects a new policy for announcing routine emissions recalls."
"This campaign has no safety implications. Nor are there any associated fines," FCA spokesman Eric Mayne said in an email. "This issue was discovered by FCA during routine in-use emissions testing and reported to the agency. "We began contacting affected customers last month to advise them of the needed repairs, which will be provided at no charge."
The recall covers the following vehicles:
.
2011-2016 Dodge Journey (front-wheel drive)
2011-2014 Chrysler 200 / Dodge Avenger (front-wheel drive)
The fix for the recalled cars involves replacing the catalytic converters. FCA said it is planning to recycle precious metals from old converters.
The recall will be conducted in phases, beginning with the 2011 model in the first quarter of 2019. Model-year 2012 vehicles will be recalled in the second quarter, 2013-2014 in the third quarter and 2015-2016 vehicles in the fourth quarter.
“EPA welcomes the action by Fiat Chrysler to voluntarily recall its vehicles that do not meet U.S. emissions standards,” EPA Administrator Andrew Wheeler said in a statement “We will provide assistance to consumers navigating the recall and continue to ensure that auto manufacturers abide by our nation’s laws designed to protect human health and the environment.”
The EPA tests vehicles usually between one and seven years old to investigate the effectiveness of the vehicle’s emissions control systems over a "120,000- to 150,000-mile useful life," at its National Vehicle and Fuel Emissions Laboratory in Ann Arbor. Automakers also conduct additional testing on their own.
The recall follows a recent settlement reached by EPA and Fiat Chrysler to settle allegations from federal regulators that the company used software on about 104,000 diesel-powered pickups and SUVs that is similar to “defeat devices” that were used by Volkswagen AG to cheat U.S. emissions-testing.
hat settlement, which is unrelated to Wednesday's recall of vehicles with gasoline engines, requires Fiat Chrysler to pay $280 million to compensate drivers of Jeep Grand Cherokees and Dodge Ram 1500 pickups from the 2014-2016 model years with 3-liter V-6 diesel engines.
The company also will pay $305 million in civil penalties to the EPA, U.S. Department of Justice and California Air Resources Board and at least $72 million to states whose attorneys general had sued over the alleged cheating.
Drivers of the affected models could receive as much as $2,800 each under the settlement.
FCA was not required to admit any wrongdoing as part of the settlement and the company is not required to buy back any of the affected vehicles.
Fiat Chrysler Automobiles NV said Monday it was proposing a merger with Renault SA, a move that is likely to shake up the global automotive industry.
In a news release, the company said the combined business would be 50% owned by FCA shareholders and 50% by Groupe Renault shareholders with a “balanced governance structure.” They said the majority of the board would be independent.
Renault already has an alliance with Nissan Motor Co. Renault and Nissan have a 20-year-old partnership in which they share technology and vehicle parts. Renault owns 43.4% of Nissan, while Nissan owns 15% of Renault.
The Renault-Nissan relationship has come under strain as the two sides debate whether to overhaul the cross-shareholding arrangement and how to make joint decisions on future models and technologies.
If Renault and FCA merge, it would create a car company with a combined value of about $37 billion and annual vehicle production of almost nine million passenger cars and light trucks. Such a combination would rank as the third-largest auto maker by production, behind Volkswagen AG and Toyota Motor Co. but ahead of General Motors Co.
Renault Considering Fiat’s Offer to Merge Into a New Auto Giant
The French carmaker Renault on Monday said it was considering a proposal by Fiat Chrysler to merge and form a global partnership aimed at improving their chances of surviving the coming perilous and costly shift to electric and self-driving cars.
If the proposal goes forward, the new company would displace General Motors as the third-largest car company in the world, behind Volkswagen and Toyota, and significantly change the balance of power in the global auto industry.
Under Fiat’s proposal, shareholders of both companies would receive 50 percent of the new company. The combination would have a total value on the stock market of $39 billion.
There is a consensus among industry executives and analysts that carmakers must link up to share the cost of a transition from internal combustion engines to avoid being run over by fast-moving tech industry challengers like Tesla or Uber. A Fiat-Renault deal would put pressure on rivals to find partners or be left behind as competitors unite in new mega-alliances.
Both companies talked over the weekend about a strategic partnership. But proposing a full-blown merger illustrates the urgency that automakers feel as they stand on the brink of what may be the biggest period of transition since the early days of the automobile.
Fiat Chrysler Automobiles said in a statement that it was motivated by “the need to take bold decisions to capture at scale the opportunities created by the transformation of the auto industry in areas like connectivity, electrification and autonomous driving.”
Renault said Monday that its board would consider Fiat’s “friendly proposal.”
The board “decided to study with interest the opportunity of such a business combination, comforting Groupe Renault’s manufacturing footprint and creating additional value for the Alliance,” the company said.
A spokesman for Fiat Chrysler said there had been no decision on a name for the merged company, nor a decision on a chief executive.
Investors cheered the idea. Renault shares soared almost 14 percent in Paris trading while Fiat Chrysler shares rose more than 10 percent in Milan.
Still, the lesson from past auto mergers is that they often founder on clashing corporate cultures or turf battles, and that predictions of the possible benefits prove overly optimistic. That was the case with Chrysler’s ill-fated merger with Daimler in the late 1990s.
A union of Fiat Chrysler and Renault could also destabilize the French company’s longtime alliance with Nissan of Japan, which is already troubled. A Nissan spokesman on Monday declined to comment.
This deal would be particularly tricky because it will inevitably draw the attention of political leaders in Italy and France, who will fight to preserve as many jobs as possible. The French government is Renault’s largest shareholder.
By purchasing parts together, combining their manufacturing operations and sharing the cost of research and development, the partnership would eventually save 5 billion euros, or $5.6 billion per year, Fiat said. At the same time, Fiat said, the deal would not result in any plant closings.
The merger “would create new opportunities for employees of both companies and for other key stakeholders,” Fiat said.
It is hard to see how Fiat and Renault would be able to avoid job cuts, though, when their factories are operating below capacity and the European auto industry is suffering a downturn.
PARIS— Fiat Chrysler Automobiles NV has withdrawn its proposal to merge with Renault SA after the French auto maker’s alliance partner, Nissan Motor Co. , refused to back the deal, according to people familiar with the matter.
Nissan’s two representatives on Renault’s board were withholding support late Wednesday as other board members prepared to vote in favor of the $40 billion merger, the people said. The planned abstentions raised doubts about Nissan’s commitment to preserving the alliance if the merger were to proceed, the people said.
The French government said Wednesday it wouldn’t approve Fiat Chrysler’s merger proposal without Nissan’s guarantee that Renault’s decadeslong alliance with Nissan would survive. The state asked to delay a vote on the merger, prompting Fiat Chysler to withdraw its merger proposal, the people said.
Fiat Chrysler’s merger proposal aimed to build scale to cope with slowing sales and the rising cost of developing electric vehicles and self-driving cars. The combined company, if realized, would produce almost nine million passenger cars and light trucks a year, placing it just behind Volkswagen AG and Toyota Motor Co.
The negotiations represented a test of the European auto industry’s ability to overcome national economic rivalries and establish a European champion, akin to Airbus SE in aviation. Fiat Chrysler sent Renault directors a merger proposal on May 26 that called for the combined business to be 50%-owned by its shareholders and 50% by Renault shareholders.
French and Italian officials signaled cautious support for the deal when the proposal was made public last week. The French state, which is Renault’s largest shareholder and has two seats on its board, had pushed Fiat Chrysler for concessions in recent days.
Complicating the consummation of the deal was the two-decade partnership between Renault and Nissan in which they share technology and vehicle parts. Renault owns 43.4% of Nissan, while Nissan owns 15% of Renault. The Japanese company hasn’t been involved in the talks, people familiar with the discussions have said.
Nissan CEO Hiroto Saikawa on Monday said that the proposed merger if realized would significantly alter the structure of Renault.
“This would require a fundamental review of the existing relationship between Nissan and Renault,” Mr. Saikawa said.
Automaker to Pay $40 Million for Misleading Investors
FOR IMMEDIATE RELEASE
2019-196
Washington D.C., Sept. 27, 2019 —
The Securities and Exchange Commission today charged Michigan-based automaker FCA US LLC, and its parent company, Fiat Chrysler Automobiles N.V., for misleading investors about the number of new vehicles sold each month to customers in the United States. FCA US and Fiat Chrysler Automobiles have agreed to pay $40 million to settle the charges.
According to the SEC’s order, between 2012 and 2016, FCA US issued monthly press releases falsely reporting new vehicle sales and falsely touting a “streak” of uninterrupted monthly year-over-year sales growth, when in fact, the growth streak had been broken in September 2013. FCA US and Fiat Chrysler Automobiles included the press releases in their SEC filings. New vehicle sales and the growth streak were key performance indicators that illustrated the company’s competitive position and demand for its vehicles. The SEC’s order finds that FCA US inflated new vehicle sales results by paying dealers to report fake vehicle sales and maintaining a database of actual but unreported sales, which employees often referred to as a “cookie jar.” In months when the growth streak would have ended or when FCA US fell short of other targets, FCA US dipped into the “cookie jar” and reported old sales as if they had just occurred.
“New vehicle sales figures provide investors insight into the demand for an automaker’s products, a key factor in assessing the company’s performance,” said Antonia Chion, Associate Director in the Division of Enforcement. “This case underscores the need for companies to truthfully disclose their key performance indicators.”
The SEC’s order finds that FCA US and Fiat Chrysler Automobiles violated the antifraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934, as well as the reporting, books and records, and internal accounting controls provisions of the Exchange Act. Without admitting or denying the Commission’s findings, the two companies have agreed to cease and desist from committing or causing any future violations of these provisions and to pay a civil penalty of $40 million on a joint and several basis.
The SEC’s investigation was conducted by Gosia Spangenberg, Andrea Fox, Daniel Maher, and Nicholas Margida, under the supervision of Lisa Deitch, Peter Rosario, and Ms. Chion.
Turns out there's another Fiat sales thread. @Yumcha slacking off again.
Anyways, reports suggest that sales were inflated by thousands. Not sure if it's 5,000 to 6,000 per month or per year or some other time period.
DETROIT -- An internal review ordered in mid-2015 by top Fiat Chrysler executives uncovered thousands of vehicle sales reported by FCA brands for which there were no actual buyers, according to two company sources.
The insiders told Automotive News that following the inquiry, U.S. sales head Reid Bigland put a stop to the practice, which had resulted in FCA US reporting more sales than it actually made.
The sources did not specify the precise time period covered by the review but said it revealed that 5,000 to 6,000 vehicles had been reported as sold by dealers and then "unwound."
Fiat Chrysler and Peugeot in talks over $50 billion tie-up
October 30, 2019
MILAN/PARIS (Reuters) - Talks between Fiat Chrysler and Peugeot owner PSA over a potential tie-up that could create a $50 billion car giant gathered pace on Wednesday, with one source saying a deal could be announced as early as Thursday.
The two groups said in separate statements they were holding discussions aimed at creating one of the world’s leading auto makers, better placed to tackle a host of costly technological and regulatory challenges facing the global auto industry.
The companies have each called unscheduled board meetings on Wednesday to discuss the potential deal, people close to the matter said, while one source familiar with the discussions said an agreement could be announced as soon as Thursday.
Spokespeople for Fiat Chrysler Automobiles (FCA) and PSA declined to comment on a timeline.
After ditching a proposed merger with Renault in June, FCA Chairman John Elkann confirmed the group’s bid to pursue an alternative alliance as carmakers face huge investments in electrification, emission reduction and autonomous driving technologies.
The merged entity would still face substantial challenges, as auto manufacturers grapple with a global downturn in demand while trying to develop costly, cleaner car models as deadlines to meet ever more stringent anti-pollution rules loom.
And a combination of PSA and FCA would first have to overcome a series of political, financial and governance hurdles, though it elicited an encouraging early response from the French government, a key PSA shareholder.
France’s dithering over FCA’s pursuit of Renault - where it is also a shareholder, but was keen for the French carmaker to first resolve its tensions with existing partner Nissan - contributed to the collapse of that merger plan.
French government spokeswoman Sibeth Ndiaye said Paris was following the PSA-FCA talks closely with an eye on the fallout for jobs, but added an enlarged group was ultimately “the best path to protecting employment.”
The tie-up would leave France with two major players in the global industry, as opposed to the Renault-FCA-Nissan configuration, which left PSA trailing.
Morningstar senior equity analyst Richard Hilgert said in a note that total volumes of FCA and PSA, including China joint venture partners, amounted to 8.7 million vehicles last year, ranking the eventual combined group fourth behind Volkswagen, Toyota and the Renault-Nissan alliance, each at more than 10 million vehicles.
“We view the combination of these two companies as reasonable given global competition, high capital intensity, and industry disruption from electrified powertrain as well as autonomous technologies,” Hilgert said.
MILAN — The boards of French carmaker PSA, the owner of Peugeot, and Fiat Chrysler in separate meetings on Tuesday approved a binding agreement for a $50 billion merger, sources said.
The two midsized carmakers announced plans six weeks ago for a tie-up to create the world's No. 4 carmaker and reshape the global industry. A merger is seen helping them deal with big challenges in the industry, including a global downturn in demand and the need to develop costly cleaner cars to meet looming anti-pollution rules.
Both companies declined to comment.
A source close to FCA had said earlier the two companies could formally announce the agreement early on Wednesday, followed by a conference call to explain further details later in the day.
China's Dongfeng Motor Group, which now has a 12.2% equity stake in PSA, will have a reduced stake of around 4.5% in the merged group, two sources said, in a move that could help make regulatory approval easier.
According to the deal approved by PSA's board on Tuesday, FCA's robot unit, Comau, will remain within the combined group rather than be spun off as was originally planned in October, the sources said.
The new group will evaluate how to extract value from Comau.
Ahead of the meetings, entities representing the Peugeot family, Etablissements Peugeot Freres (EPF) and FFP, unanimously approved a proposed memorandum of understanding for the planned merger, a source familiar with the situation said.
FCA and PSA are expected to finalise a deal by the end of 2020 to create a group with 8.7 million annual vehicle sales, a source said.
That would put it fourth globally behind Volkswagen AG, Toyota and the Renault-Nissan alliance. It was only six months ago that FCA abandoned merger talks with PSA's French rival Renault.
FCA would gain access to PSA's more modern vehicle platforms, helping it meet tough new emissions rules, while Europe-focused PSA would benefit from FCA's profitable U.S. business featuring brands such as Ram and Jeep.
However, the deal could still face close regulatory scrutiny, while governments in Rome, Paris and unions are all likely to be wary about potential job losses from a combined workforce of around 400,000.
PSA's Carlos Tavares will be chief executive and FCA's John Elkann — the scion of Italy's Agnelli family, which controls FCA through their holding company Exor — chairman of the combined company.
FCA confirmed this week that Dodge will end production of both the Grand Caravan and the Journey after the 2020 model year, leaving the brand without a front-wheel drive crossover for the first time since 2008, and without a minivan for the first time in nearly four decades.
"The year was 1983. Ronald Reagan was President of the United States of America. Lech Walesa was the Nobel Peace Prize Laureate. The Internet was created, and the first mobile phones were introduced to the public. U.S. astronauts completed the first space shuttle spacewalk; Michael Jackson performed the 'moonwalk.' The Baltimore Orioles won the World Series ... and Chrysler hit a home run with the introduction of the first minivan," FCA (then Chrysler LLC) said when it celebrated the minivan's 25th anniversary in 2008.
Since that anniversary, the Dodge variant of FCA's minivan has changed very little. It has received interior and powertrain improvements, including the introduction of the 3.6-liter "Pentastar" V6 in 2011, but its fundamental architecture has remained constant. The lack of attention it received came to light in 2019, when the outdated powertrain disqualified it from new-car sales eligibility in California.
The prior 25 years notwithstanding, the story of the Dodge Journey is somewhat similar. Introduced in 2008 as a 2009 model, it was praised as one of Chrysler's better, more modern offerings when it hit dealerships. Like the Grand Caravan, it later benefited from an interior overhaul and the introduction of the 3.6-liter V6, but its bones remained unchanged for the duration. This lack of attention showed, as the Journey slipped from borderline-competitive to also-ran.
The discontinuation of the Grand Caravan and Journey eliminates 40% of the Dodge lineup. The two models represent more than 38% of the brand's sales volume so far in 2020. For 2021, only the Charger, Challenger and Durango will remain. Minivan buyers will still have options at Chrysler, which offers several variants of the Pacifica, including the new Voyager, which is a stripped-down model aimed at budget-conscious buyers who would previously have been drawn to the bare-bones Dodge.
With this latest round of downsizing, Dodge will join Ram, Chrysler, Fiat and Alfa Romeo in the ranks of FCA brands offering four or fewer models; only Jeep will offer more.
I expect the Chrysler brand to cease in the near future when the merged alliance plans to chop off unnecessary brands and expenditure. The Pacifica could most likely be inducted into Dodge as "Dodge Pacifica". The new 2021 facelift of Pacifica resembles more Dodge anyways. The sweet Chrysler 300 will most likely run its course and slowly die off. Whatever they decide to name the new alliance, they better act quickly to electrify their line up or risk mass extinction.
^ Not unlikely.
I see fewer & fewer Chrysler cars on the road, far many more Chargers than 300s, and rarely see a Pacifica, compared to the Odyssey/Sienna crowd.
^ Not unlikely.
I see fewer & fewer Chrysler cars on the road, far many more Chargers than 300s, and rarely see a Pacifica, compared to the Odyssey/Sienna crowd.
You may be near one of the coasts, I don’t know, but in Midwest at least the Pacifica far outnumbers the newer Odysseys. Not considering the Sienna since it’s older.
Stellantis: The name of new group resulting from the merger of FCA and Groupe PSA
July 15, 2020 13:30 ET | Source: Fiat Chrysler Automobiles N.V.
The name of the new group resulting from the merger of FCA and Groupe PSA
In a major step as they move towards the completion of their 50:50 merger as defined in the Combination Agreement announced on 18 December 2019, Peugeot S.A. ("Groupe PSA") and Fiat Chrysler Automobiles N.V. ("FCA") (NYSE: FCAU / MTA: FCA) today announce that the corporate name of the new group will be
.
is rooted in the Latin verb “stello” meaning “to brighten with stars”. It draws inspiration from this new and ambitious alignment of storied automotive brands and strong company cultures that in coming together are creating one of the new leaders in the next era of mobility while at the same time preserving all the exceptional value and the values of its constituent parts.
will combine the scale of a truly global business with an exceptional breadth and depth of talent, knowhow and resource capable of providing the sustainable mobility solutions for the coming decades. The name’s Latin origins pay tribute to the rich history of its founding companies while the evocation of astronomy captures the true spirit of optimism, energy and renewal driving this industry-changing merger.
The process of identifying the new name began soon after the Combination Agreement was announced and the senior management of both companies have been closely involved throughout, supported by Publicis Group.
The
name will be used exclusively at the Group level, as a Corporate brand. The next step in the process will be the unveiling of a logo that with the name will become the corporate brand identity. The names and the logos of the
Group’s constituent brands will remain unchanged.
As previously stated, completion of the merger project is expected to occur in the first quarter of 2021, subject to customary closing conditions, including approval by both companies’ shareholders at their respective Extraordinary General Meetings and the satisfaction of antitrust and other regulatory requirements.
Introducing Stellantis. Talk to your doctor before using Stellantis as side effects may include model redundancy, the overwhelming urge to apply Dodge badges to Peugeot crossovers, and weak stream.
Honestly, how can you not poke just a little fun at the name chosen for the new multi-national corporation that will result once the merger of Fiat Chrysler Automobiles (FCA) and Peugeot S.A. (Groupe PSA) is completed in the first quarter of 2021. According to the press release, "Stellantis is rooted in the Latin verb 'stello' meaning 'to brighten with stars' ... The name's Latin origins pay tribute to the rich history of its founding companies while the evocation of astronomy captures the true spirt of optimism, energy and renewal driving this industry-changing merger."
The "Latin origins" of the French company Peugeot and the Italian Fiat are obvious. Chrysler, on the other hand, was founded by a man born in Kansas whose father was a Canadian-American of German and Dutch ancestry (thanks Wikipedia). His mother was also of German ancestry. So yeah, the name Stellantis is really only related to the Peugeot and Fiat bits. The Americans are just along for the ride with their Jeeps and Hellcats.
And it should be noted that we will henceforth never write "Stellantis" in ALL CAPS as the corporation does because it's silly and we don't do it for Hummer, Mini, etc. Admittedly, Fiat could go either way since it's literally an acronym, but Fiat doesn't even bother doing that any more.
The name Stellantis will only be applied at the corporate level, so effectively in place where you previously would've said Fiat-Chrysler or FCA. There won't be a Stellantis Challenger.
BRUSSELS/MILAN — Peugeot maker PSA has offered to boost Japanese rival Toyota to try to address EU antitrust concerns about its plan to create the world's fourth-biggest carmaker, to be called Stellantis, by merging with Fiat Chrysler, people familiar with the matter said on Friday.
PSA has offered to increase the production capacity for Toyota in their van joint venture, one of the sources said. Another source said the French company would sell the vans at close to cost.
PSA makes vans for Toyota in its Sevelnord plant in northern France. The van collaboration started in 2012.
PSA submitted its offer to the European Commission earlier on Friday, three months after the EU enforcer opened a full-scale investigation into the deal with FCA on concerns that it would hurt competition in small vans in 14 EU countries and Britain.
"As of now, the transaction has obtained merger clearance in 14 jurisdictions. As previously stated, closing of the transaction is expected to occur in the first quarter of 2021," PSA and FCA said in a joint statement.
The Commission, which temporarily halted its investigation into the deal in July while waiting for the companies to provide requested data, did not set a deadline for its decision.
"The deadline is still suspended. This procedure in merger investigations is activated if the parties fail to provide, in a timely fashion, an important piece of information that the Commission has requested from them," the EU executive said.
It is now expected to seek feedback from customers and rivals before deciding whether to demand more concessions, or either clear or block the deal.
PARIS — PSA is ending the production of Peugeot and Citroën small city cars, three sources told Reuters, withdrawing from an increasingly unprofitable market as its starts a strategic review ahead of its planned merger with Fiat Chrysler.
While PSA had already agreed to sell its stake in its Czech joint venture with Toyota where the Peugeot 108 and Citroen C1 models are made, the decision to stop selling the gasoline cars altogether has just been taken, the sources said.
Carmakers are reviewing the production of vehicles with combustion engines as they need to fit costly exhaust filtering systems to meet tighter emissions laws. That's pushing up the cost of some so-called entry-level A segment cars to the point where they are hard to justify economically.
"PSA is getting out of both the factory and the A segment business, as it is offered today, and on which manufacturers have arguably lost the most money in Europe," one of the sources familiar with the matter said.
PSA declined to comment on the future of the two small cars. It said it was reviewing which products would best meet customer expectations in the A segment and cope with European carbon emissions targets.
"This means a reflection with fresh and disruptive ideas," a spokesman for the French carmaker said.
The European Commission is planning to tighten its emissions limits for cars under new proposals designed to cut the bloc's greenhouse gas output further by 2030.
PSA's merger project with FCA has also increased the options available, two of the sources said, as the Italian-U.S. company has no intention of abandoning its small best-selling Panda and 500 models. Both already have hybrid versions and the 500 is also available in full electric mode.
"Current projects could be replaced by new ones made possible by the merger with FCA", another source said. "The merger is turning all the cards around, especially when you consider that the A segment, from the very first 500 to the Panda, is inseparable from Fiat history".
FCA declined to comment.
PSA and FCA aim to finalize their merger in the first quarter next year to create a new company called Stellantis, which will be the fourth-biggest automaker in the world.
Great, they saw the writing on the wall. Now, go ahead and push for all electric versions, invest in battery technology, and a lot their problems will be solved / minimized.
FCA announced Friday that it's adding Redeye power to its crate motor program. The new 6.2-liter Hellcrate Redeye becomes the fifth modern Hemi design to be made available to end customers, joining the 5.7- and 6.4-liter naturally aspirated offerings, the supercharged 6.2-liter Hellcrate, and the monstrous, 1,000-horsepower 426 "Hellephant."
Just in case a "regular" 707-horsepower Hellcat swap isn't enough, the Redeye ticks that up to 807 horsepower thanks to a larger-displacement supercharger producing 14.5 pounds of boost (up from 11.6), a higher rev limiter (6,500 vs. 6,200 RPM), reduced weight and friction, improved piston cooling and better oiling. And all of it can be yours for an eye-watering $21,807 — or about 1/3 the cost of an actual Dodge Challenger SRT Hellcat Redeye.
"2021 marks the year that Dodge is distilled to a pure performance brand with 700+ horsepower models available across the entire Dodge lineup," said FCA fun-stuff boss Tim Kuniskis, in the company's announcement.
Part of the appeal of a V8 swap in America is that it's typically pretty inexpensive thanks to the multitudes of pickup trucks being scrapped from the country's roads on an almost-weekly basis, but crate motors are another animal entirely, and a far more expensive path for those craving more power. On the flip side, they're perfect for the professional, high-quality builds we're accustomed to seeing at venues such as SEMA.
Plus, OEMs tend to offer accessories for mating these engines to existing powertrains and making use of factory accessories. In this case, kits for both automatic and manual transmission applications are available, and an accessory drive kit includes an alternator, power-steering pump, belts, pulleys and mounting hardware.
DETROIT — Fiat Chrysler CEO Mike Manley will run operations in the Americas when his company merges with France’s PSA Peugeot early next year.
FCA Chairman John Elkann announced Manley’s new post on Friday in a letter to employees. Manley’s role in the merged company had been a mystery.
PSA CEO Carlos Tavares will run the overall company, to be named Stellantis. Shareholders of both companies will vote on the merger Jan. 4 to seal the deal creating the world’s fourth-largest automaker. The merger is expected to be completed by the end of March.
PSA will get six seats on the new company’s 11-member board, which will be chaired by Elkann.
The Americas, especially the U.S., are key to the new company’s success. Fiat Chrysler’s Jeep and Ram brands are highly profitable, and Tavares has long wanted to sell PSA vehicles in the U.S.
Manley has been the Italian-American automaker’s CEO for 2 1/2 years, taking over when Sergio Marchionne died in 2018.
Stellantis will have the capacity to produce 8.7 million cars a year, just behind Volkswagen, the Renault-Nissan alliance and Toyota.
2020 is the final model year for the Fiat 124 Spider and the 500L, FCA announced Wednesday. The Miata-based roadster and family-ish hatchback will not return for 2021, slicing Fiat's U.S. portfolio to just a single model in one fell swoop.
"For the 2021 model year, the Fiat lineup will feature the Fiat 500X small crossover, which offers unique and functional Italian design, standard all-wheel-drive capability, 9-speed automatic transmission, 30 mpg highway and best-in-class 210 lb-ft of torque," Fiat said in its announcement. "The Fiat 124 Spider and the Fiat 500L will be discontinued after the 2020 model year."
A joint-development project between Mazda and FCA, the reborn 124 Spider was originally supposed to be an Alfa Romeo. At what seemed like the last minute, labor issues and an Alfa product development shuffle shunted the project to Fiat.
The final product was an interesting blend of Italian and Japanese style and engineering. The engine and exterior design were provided by Fiat; the platform, transmission and interior all came from Mazda. The result was a slightly heavier and more powerful roadster than the Miata on which it was based.
As an added bonus, the enthusiast-friendly Abarth model, with the same upgrades Mazda offered on the MX-5 Club, was cheaper trim-for-trim, especially after Fiat's far more generous discounts. Since then, the 124's advantages have been somewhat overshadowed by improvements to the Miata, which got a more potent engine for the 2019 model year.
On the other hand, we wouldn't blame you if you'd forgotten that the 500L was still in production at all. Apart from a core group of loyal buyers, the frumpy hatchback never really caught on in the United States.
Fiat also announced several trim updates and some pricing changes for its sole remaining model. The base 500X gets a $250 price hike (up to $26,335 after a $1,495 destination charge), and Fiat is introducing new packages for the Sport model to give potential customers more flexibility.
The Fiat's platform-mate, the Jeep Renegade, remains cheaper, but its standard engine is the naturally aspirated 2.4-liter Tigershark"4-cylinder, while the 1.3-liter turbocharged engine is a $1,495 upgrade.
MILAN — While running Nissan’s North American operations from 2009 to 2011, Carlos Tavares had a reputation for closely watching costs with little tolerance for vehicles or ventures that didn’t make money.
Experts say that means Tavares, currently the head of PSA Group, is likely to follow that blueprint when he becomes leader of a merged PSA and Fiat Chrysler Automobiles. The low-performing Chrysler brand might get the axe as could slow-selling cars, SUVs or trucks that lack potential.
Already the companies are talking about consolidating vehicle platforms — the underpinnings and powertrains — to save billions in engineering and manufacturing costs. That could mean job losses in Italy, Germany and Michigan as PSA Peugeot technology is integrated into North American and Italian vehicles.
“You can’t be cost efficient if you keep the entire scale of both companies,” said Karl Brauer, executive analyst for the iSeeCars.com auto website. “We’ve seen this show before, and we’re going to see it again where they economize these platforms across continents, across multiple markets.”
Shareholders of both companies are to meet Monday to vote on the merger to form the world’s fourth-largest automaker, to be called Stellantis. The deal received EU regulatory approval just before Christmas.
Tavares, who for years has wanted to sell PSA vehicles in the U.S., won’t take full control of the merged companies until the end of January at the earliest.
He likely will target Europe for consolidation first, because that’s where Fiat vehicles overlap extensively with PSA’s, said IHS Markit Principal Auto Analyst Stephanie Brinley. Europe has been a money-loser for FCA, and factories in Italy are operating way below capacity — a concern for unions, given Fiat’s role as the largest private sector employer in the country.
“We are at a crossroads,’’ said Michele De Palma of the FIOM CGIL metalworkers’ union. “Either there is a relaunch, or there is a slow agonizing closure of industry, in particular the auto industry, in Italy.”
Italy’s hopes lie with the luxury Maserati and sporty Alfa Romeo brands, but De Palma said investments are needed to bring hybrid and electric technology up to speed. Fiat’s Italian capacity stands at 1.5 million vehicles, but only a few hundred thousand are being produced each year. Most factories were on rolling short-term layoffs due to lack of demand, even before the pandemic.
The merger is likely to also hit white collar workers, as Tavares is unlikely to keep engineering centers in Paris, Turin and Rodelsheim, Germany, where the Opel brand he acquired in 2017 is located, according to analysts.
FCA’s North American operations, led by the popular Jeep brand and Ram pickup, are hugely profitable and likely will be left untouched for a while, Brinley said. Tavares just three years ago stated his desire to sell PSA vehicles in the U.S. within a decade. He said any global automaker has to sell in the U.S. market.
In December the companies announced that Fiat Chrysler CEO Mike Manley would run Stellantis’ operations in the Americas.
Larger Jeep and Ram trucks and SUVs are unique to the U.S. and generally don’t sell well in Europe, so Brinley expects those to be designed by Fiat Chrysler in Auburn Hills, Michigan, north of Detroit. Eventually some cars and some smaller SUVs, though, will move to PSA underpinnings, she said.
PSA has a wider array of fuel-efficient smaller engines, and Fiat Chrysler will need those to meet government fuel mileage and pollution requirements worldwide. The PSA Group’s goal is to offer its all models with electrified powertrains by 2025, an area where Fiat Chrysler also has lagged.
Analysts say the Chrysler brand could be in jeopardy in the U.S., where it has only two models, the aging 300 sedan and the Pacifica minivan. U.S. sales of the brand were off 19% through October.
The two companies have yet to announce any decisions on brands. Fiat Chrysler, in a statement from Michigan, said one of Stellantis' greatest strengths is its historic brands, including 10 from FCA, adding that there are no plans to close any plants. But PSA said in a statement from Paris that it hasn't announced any plans for the brands. “We will communicate in due on this matter, as the EGA (shareholders' vote) is not the closing date, neither the announcement of a strategic plan,” the statement said.
Brauer said U.S. consumers aren’t likely to see Peugeot vehicles, though. Instead, smaller vehicles will be built on French or German underpinnings with bodies and interiors designed in Michigan.
While the tie-up is billed as a merger, the advantage goes to PSA, which will control 6 of the 11 board seats with Tavares the tie-breaker.
Fiat Chrysler’s brands range from powerhouse Jeep to the performance Abarth marquee and the historic Italian brand Lancia, which currently produces just one model, the Ypsilon, targeting female drivers. “I don’t expect cutting brands that still make volumes, even if they are focused on very specific market segments, like Lancia,” said Francesco Zirpoli, director for the Center for Automotive and Mobility at Venice’s Ca’ Foscari University. But Stellantis will have too many factories in Europe making similar vehicles. “These overlaps have to be resolved,” he said.
Stellantis also will face a major challenge in Asia, in particular China, where both PSA and FCA are weak.
“The big market of the future is Asia. Asia will dominate the car business,’’ said Ferdinand Dudenhoeffer, of the Center for Automotive Research in Germany. Already it is 45% of global sales. “They merge, OK. They find synergies, OK. They reduce headcount, OK. But they are missing the most important point in the car business."
07-25-2018, 07:59 AM
Sergio
