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FCA happy with Q2 performance though Maserati needs work

By Graeme Roberts | 31 July 2019

FCA reported second quarter 2019 net profit of EUR0.8bn, adjusted net profit of EUR0.9bn, adjusted EBIT of EUR1.5bn and margin of 5.7%.

Full-year guidance was confirmed.

"We continue to deliver strong performance in North America and LATAM. Robust demand for our new products, along with steps we've taken to exert discipline across all of our businesses, have generated the momentum to achieve our full-year 2019 guidance," said CEO Mike Manley.

 Worldwide combined shipments were down 11% to 1,157,000 units.

While the group's adjusted EBIT was in line with Q2 2019, prior year, North America achieved record Q2 results with adjusted EBIT of EUR1,565m and margin at 8.9% despite shipments being down 12%, largely attributable to dealer stock reductions of approximately 80,000 units. The successful launch of the redesigned Ram heavy-duty pickup, along with the continued success of the redesigned and Classic Ram 1500, resulted in a US large pickup market share of 27.9% in Q2, up 7 ppts from last year. The new Jeep Gladiator pickup launch is exceeding FCA expectations with production already achieving full run rate. Although new to the market, the Gladiator earned a 7.7% share of its US segment in June.

Solid financial results in LATAM were driven by strong commercial performance in Brazil where FCA retained the market leader position. Adjusted EBIT was up 9% to EUR110m and margin at 5.4%, up 60 bps.

In the second half of the year, FCA said, it would continue to focus on the underperforming areas of its business, including Maserati, where it had "reinforced" management; and
EMEA, where it continued to target increased margins through the impact of restructuring actions, better management of channel mix, and targeted product strategies.

"Based on the strength of our second quarter results and the initiatives put in place to maintain this momentum, we remain confident in our ability to achieve our full-year 2019 guidance," FCA said.