Fiat Chrysler Automobiles (FCA) has reported first quarter adjusted net profit of EUR0.6bn, some 41% below the same quarter last year. Revenues were off 5% on last year’s pace at EUR24.5bn for the quarter.
However, despite the weak looking overall numbers, the company stuck to its full-year guidance.
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FCA CEO Mike Manley said the market is responding enthusiastically to the rollout of FCA’s new products. “We continue to execute initiatives that will strengthen the underperforming parts of our business,” he said. “Based on these factors and our first quarter results being in line with our expectations, we are confident in our 2019 guidance.”
First quarter adjusted earnings before interest and tax (EBIT) fell 29% to EUR1.07bn.
FCA reported worldwide combined shipments of just over 1m units in Q1, down 14% on last year, ‘primarily due to non-repeat of overlapping of all-new and prior generation Jeep Wrangler production and planned realignment of commercial strategies in Europe.’
Adjusted EBIT decreased 29% to EUR1.067m, primarily from lower volumes partially offset by positive net pricing in North America.
Operating profit margins in North America fell to 6.5%, down almost a percentage point on last year.
FCA said the effect of reduced volumes globally were partially offset by continuing growth in Ram volumes, improved net pricing, particularly in North America, along with better channel and product mix in several markets.
FCA singled out the strong performance of the Ram 1500 as an important highlight for the quarter. It claimed the number two position in the profitable US light-duty segment for the quarter with a market share of 23.3%, an increase of 4.5 percentage points over last year.
FCA also noted several steps to ‘strengthen our business in the first quarter’. These included the successful negotiation of a labour agreement in Italy and continued implementation of cost-containment actions in all regions. In addition, it announced an extension to its Sevel partnership with Groupe PSA whereby FCA will increase production capacity in the Sevel joint operation, ‘enabling our future growth in the high margin LCV segment in Europe’.
The company also said other steps taken include the addition of new senior leaders to drive improved performance; an aggressive focus on Maserati distribution network and marketing; and, progress towards a restructure of a JV in China. Further, it said the launches of the all-new Ram Heavy-Duty and Jeep Gladiator are on track and generating enthusiastic responses from the market. These products will contribute to volume and margin expansion in North America, particularly in the second half of the year, FCA maintains
