ITALY: Fiat Looks To Boost Profits
He outlined his long-term corporate plan for Fiat, Italy's No. 1 carmaker and the country's leading private employer, at a shareholders meeting Monday.
Though carmaking is Fiat's core business, the company is involved in numerous other activities, including insurance, agricultural machinery and trucks.
In recent months, Fiat has invested heavily in its non-car businesses. It has closed deals designed to bolster Comau, its automation system-making division; Teksid, Fiat's metallurgical branch, and Magneti Marelli, its automotive component arm which is also expected to expand in the service maintenance business.
Monday's general meeting of Fiat shareholders was the first after the Turin-based group, which employs 220,000 people around the world, announced a strategic alliance with U.S. automaker General Motors Corp. in March.
Under the venture, GM and Fiat Auto agreed to share costs, factories and components around the world.
While pledging to raise profits this year, Fresco acknowledged Monday that Fiat's 1999 figures were unsatisfactory. Fiat earned 353 million euros, or $331.8 million, on revenue of 48.1 billion euros, or $45.2 billion, last year.
This year, the group will have significant growth in operating profit as well as a rise in pretax profit, he said. Its operating profit was 788 million euros, or $740.7 million, and its pretax profit was 518 million euros, or $486.9 million, in 1999.
"As we have communicated on many occasions, 1999 was not -- from the point of view of results -- a satisfactory year, even though we reached the objective of posting operating profit figures that did not drop below those of the previous year," Fresco said.
Fiat expects its 2000 revenues to be between 57 billion euros ($53.5 billion) and 58 billion euros ($54.3 billion), the company's chief executive Paolo Cantarella said.