one global car company in the making - fca group global car company in the making . ... chrysler...
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20 Novembre, 2010
One global car company in the making
Sergio Marchionne
Sanford C. Bernstein - Strategic Decisions Conference
London - September 20, 2011
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2
Safe Harbor Statement
Cer ta i n i n fo rmat i on i n c l uded i n t h i s
p resen ta t i on , i n c l ud i ng , w i t hou t l im i ta t i on ,
any f o recas t s i n c l uded here i n , i s f o rwa rd
l ook i ng and i s sub j ec t t o impor tan t r i sks and
uncer t a i n t i es t ha t cou l d cause ac tua l resu l t s
t o d i f f e r ma te r i a l l y . The Group ‟ s bus i nesses
i nc l ude i t s au tomot i ve , au tomot i ve- re l a t ed and
o ther sec t o rs , and i t s ou t l ook i s p redominan t l y
based on i t s i n t e rp re ta t i on o f what i t
cons i de rs t o be the key economi c f a c t o r s
a f f ec t i ng these bus i nesses . Fo rward - l ook i ng
s t a t emen t s w i th rega rd t o t he Group ' s
bus i nesses i nvo l ve a number o f impor tan t
fa c t o r s t ha t a re sub j ec t t o change , i n c l ud i ng ,
bu t no t l im i t ed t o: t he many i n t e r re l a t ed
fa c to r s t ha t a f f ec t consumer con f i dence and
wor l dw ide demand fo r au tomot i ve and
au tomot i ve - re l a t ed p roduc t s ; governmen ta l
p rog rams; genera l economi c cond i t i ons i n each
o f t he Group ' s marke t s ; l eg i s l a t i on ,
pa r t i cu l a r l y t ha t re l a t i ng t o au tomot i ve-
re l a t ed i s sues , t he env i ronmen t , t rade and
commerce and i n f ra s t ru c tu re deve l opmen t ;
a c t i ons o f compet i t o r s i n t he va r i ous
i ndus t r i es i n wh i ch the Group competes ;
produc t i on d i f f i cu l t i e s , i n c l ud i ng capac i ty and
supp l y cons t ra i n t s and excess i nven to ry
l eve l s ; l abo r re l a t i ons ; i n t e res t ra t es and
cu r rency exchange ra t es ; po l i t i ca l and c i v i l
un res t ; ea r thquakes and o ther r i sks and
uncer t a i n t i es . Any o f the assumpt i ons
under l y i ng t h i s p resen ta t i on o r any o f the
c i r cumstances o r da ta men t i oned i n t h i s
p resen ta t i on may change . Any f o rward - l ook i ng
s t a t emen t s con ta i ned i n t h i s p resen ta t i on
speak on l y a s o f t he da te o f t h i s p resen ta t i on .
F i a t does assume and exp ress l y d i s c l a ims any
ob l i ga t i on t o upda te t hese f o rward - l ook i ng
s t a t emen t s . F i a t does no t a ssume and
express l y d i s c l a ims any l i ab i l i t y i n connec t i on
w i th any i naccu rac i es i n any o f t hese f o rward -
l ook i ng s ta t emen t s o r i n connec t i on w i t h any
u se by any th i rd par t y o f su ch f o rward - l ook i ng
s ta temen t s . Th i s p resen ta t i on does no t
rep resen t i nves tmen t adv i ce o r a
recommenda t i on f o r t he pu rchase o r sa l e o f
f i nanc i a l p roduc t s and/o r o f any k i nd o f
f i nanc i a l se rv i ces . F i na l l y , t h i s p resen ta t i on
does no t rep resen t an i nves tmen t so l i c i t a t i on
i n I t a l y , pu rsuan t t o Sec t i on 1 , l e t t e r ( t ) o f
Leg i s l a t i ve Dec ree no . 58 o f Februa ry 24 ,
1998 , a s amended, nor does i t r ep resen t a
s im i l a r so l i c i t a t i on a s con temp la ted by the
l aws i n any other count ry or s ta te .
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 3
The creation of a global automaker Milestones in the integration of Fiat & Chrysler
2009 June: 20% initial ownership interest in Chrysler Group LLC
2011 January: achievement of 1st Performance Event by Chrysler Group LLC
April: achievement of 2nd Performance Event by Chrysler Group LLC
May: exercise of Incremental Equity Call Option by Fiat
July: purchase of ownership interest in Chrysler Group LLC from UST and Canada by Fiat plus UST rights under Equity Recapture Agreement
By year-end: expected achievement of 3rd
Performance Event, moving Fiat‟s interest in Chrysler Group LLC up to 58.5% from current 53.5%
From July 1st, 2012 until June 30th, 2016: Fiat has the option to purchase 40% of VEBA‟s original interest in Chrysler. Option is exercisable not in excess of 20% of Covered Interest in any 6 month period. Before an IPO, exercise price is based on a market multiple not to exceed Fiat‟s multiple applied to Chrysler reported LTM EBITDA less net industrial debt and following an IPO based on trading price of common stock
In addition to above option, under Equity Recapture Agreement: i) Fiat may purchase any remaining membership interest held by VEBA at a specified threshold ($4.25bn plus 9% p.a. compounded annually from Jan 1, 2010), and ii) Fiat receives all proceeds from Chrysler ownership interest held by VEBA over the above threshold (and once such threshold is reached, any remaining shares are turned over to holder)
VEBA 41.5% FIAT
58.5%
Chrysler pro-forma shareholder structure
(on a fully diluted basis)
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 4
Better geographic diversification
North America
3%
Europe 60%
RoW 9%
Mercosur 28%
North America
47% Europe 32%
Mercosur 17%
RoW 4%
* 12-month contribution by Chrysler
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 5
EMEA Gianni Coda
Asia Michael Manley
Mopar Pietro Gorlier
Systems & Castings
Riccardo Tarantini
Components Eugenio Razelli
LATAM Cledorvino Belini
CHIEF OPERATING
OFFICERS
BRAND LEADERS
INDUSTRIAL PROCESS LEADERS
CEO
Sergio
Marchionne
NAFTA Sergio Marchionne
SUPPORT PROCESS LEADERS
Fiat Professional
Lorenzo Sistino
Lancia
Chrysler Saad Chehab
Chief
Marketing Officer
Olivier François
Dodge Reid Bigland
Alfa
Romeo
Abarth
Maserati Harald Wester
Fiat Olivier François
Design Lorenzo Ramaciotti
Group Purchasing
Vilmar Fistarol
Quality Doug Betts
Product Portfolio
Mark Chernoby
Powertrain Coordinator
Bob Lee
Chief
Manufacturing
Officer Stefan Ketter
Chief Technical
Officer Harald Wester
Business Development
Alfredo Altavilla
Chief Human
Resources Officer
Linda Knoll
Chief
Financial Officer
Richard Palmer
Fiat Services
& Holdings
Alessandro Baldi
Jeep Michael Manley
The leadership team
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 6
Overhaul of stand-alone companies in 2009
• Inadequate European business model
• Portfolio heavily skewed to A & B segments
• Heavy reliance for profitability on LCVs
• Under utilization of manufacturing infrastructure preventing full exploitation of operational efficiency
• Suboptimal volumes for Alfa Romeo & Lancia to support stand alone brand
• Low presence in major developing markets (China, Russia, India)
• Unique mass market brands with Fiat having the most solid position, Alfa Romeo with internationally recognized strong heritage
• A leading position for LCVs
• Leadership in CO2 emissions
• Strong positioning in Latin America
• Best-in-class time-to-market from design freeze
• Ferrari & Maserati unique iconic and profitable assets
Negative Positive Weaknesses Strengths
• Customer trust and confidence
• Heavy reliance on NAFTA markets
• Less than optimal product line-up
• Incomplete offering in C- & D-segment
• Gap in perceived quality and reliability vs. competition
• Brands with strong heritage in North America, Jeep globally recognized
• US distribution network re-sized
• Experienced and talented workforce, albeit demoralized
• Competitive labor rates and significantly restructured OPEB liabilities
• Sufficient liquidity to launch a credible business plan with speed being of the essence
Negative Positive Weaknesses Strengths
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 7
Inextricably intertwined entity leveraging on partners‟ core strengths
Sharing of best practices in the
areas of WCM, engineering and
design, quality and
management with significant
cost synergies, particularly in
purchasing and engineering
Optimized allocation of
production capacity at both
organizations
Full integration of Fiat &
Chrysler product portfolios
Strong joint geographic
coverage, Asia excepted
Critical mass target of ~6mn
units by 2014
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 8
Architecture convergence & component
standardization to yield significant benefits
100k 300k 500k 1,000k
1%-2%
2%-4%
5+%
Purchasing efficiency range (case study)
25-30%
10-15%
Model/Brand Specific
Modular Architecture & Powertrain
Other Common Components
100% = Total Vehicle Cost
• Reduced investment & development costs
• Shortened time-to-market
• Increased economies of scale
• Improved quality & reliability
• Optimized production capacity utilization & manufacturing flexibility
C SUV Alfa Romeo
C SUV Jeep
Plant A
D Sedan
Alfa Romeo
C Sedan
Chrysler Group
Plant B
Cars developed on common
architectures can be allocated to same
flexible manufacturing plant
to optimize industrial costs, including supply
chain costs
Units
ER&D and Capex savings (case study)
Top hat &
powertrain
applications
Industrial
installation
Platform
development
Up to
60-65%
reduction
55-65%
Further opportunities for savings in powertrain application costs and ER&D spending by sharing volumes
First derivative
vehicle
Primary vehicle on a
brand-new architecture
Optimal allocation of production (case study)
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 9
Structural overcapacity in Europe and restructured
industrial infrastructure in North America
Source: PwC Autofacts
Capacity Utilization
78%
63%
84% 77%
65% 73%
68% 64% 65%
74% 70% 80%
77% 73% 81%
76% 67%
78%
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 10
0
20
40
60
80
100
120
140
160
0
50
100
150
200
250
300
350
400
450
500
0
5
10
15
20
25
30
35
40
45
50
0
50
100
150
200
250
300
350
400
78%
37%
126%
54%
H1 2010
73%
33%
118%
49%
H1 2011
Rest of Europe2
Italy1
1 Italy: Cassino, Melfi, Mirafiori, Pomigliano d’Arco & Termini Imerese (ceasing production by 2001 year-end) 2 Tycky (Pol), Kragujevac (Ser), Bursa (Tur, including vehicles supplied to Opel in force of Nov 2010 agreement)
Capacity utilization at FGA (Passenger car plants)
Rest of Europe2
Italy1
Harbour definition
(235 days per annum/
16 hours per day)
Technical definition
(280 days per annum/
3 shifts per day)
Cassino
Termini Imerese (end of car production in 2011)
Melfi
90%
2010 2014E
0
50
100
150
200
250
300
350
0
50
100
150
200
250
300
350
400
450
500
Pomigliano d’Arco
Mirafiori
2010 2014E
2010 2014E
2010 2014E
2010 2014E 2010 2014E
HARBOUR DEFINITION
Officine Automobilistiche Grugliasco
TECHNICAL HARBOUR DEFINITION
TECHNICAL
HARBOUR DEFINITION
TECHNICAL
HARBOUR DEFINITION
TECHNICAL HARBOUR DEFINITION
TECHNICAL
HARBOUR DEFINITION
TECHNICAL HARBOUR DEFINITION
TECHNICAL HARBOUR DEFINITION
TECHNICAL
HARBOUR DEFINITION
TECHNICAL HARBOUR DEFINITION
TECHNICAL
Reconstructing a sustainable industrial system with
ultimate goal of European ops at break-even by 2014
Capacity
(k units)
Production
(k units)
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 11
An intense product rejuvenation underway in Europe
Major modification
• Re-launch of Alfa Romeo brand, including strong European push
• Return to North American market through Chrysler network
• Major focus on core A,B,C segments
• Full integration of Chrysler with Lancia
• Comprehensive product line leveraging on Chrysler nameplates
2011 2012 2013 2014
• Maintaining strong position in EU & Latin America
• Leveraging on Chrysler opportunities
• Consolidating strong industrial and R&D partnerships
• Strengthening body-builder business
• Revitalizing an American icon
2010
New model
• Continue building on sporty image
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 12
2011 2012 2013 2014
70th Anniversary
Commemorative
product actions
across all
nameplates
• Elegant sedans & premium minivans
• Enhanced offering with high-performance SRT versions
• Revitalizing an American icon on a global basis
• Enhanced offering with high-performance SRT versions
• Focus on pick-up trucks
• Full-line passenger cars, CUVs & minivans
• Enhanced offering with high-performance SRT versions
• Small cars
2010
Major modification
New model
Commitment to enhance product portfolio at Chrysler
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 13
• First FGA vehicle to come out of partnership with Chrysler
Initially available in FWD, powered by 2.0 140 & 170hp MultiJet II produced and developed by Fiat Powertrain
Rounding out powertrain offerings in H2
Chrysler V6 Pentastar gas engine in Q3
Diesel version equipped with automatic transmission and AWD capabilities available in latter part of the year
• Successful launch in June across Europe, with very good initial reception by market
Bringing new customers to the brand (60% new to Fiat)
• FY 2011 target of 20+k units
• Fiat‟s historical leadership in European A-segment…
More than 6 million Pandas manufactured since early 80‟s
More than 2.6 million Panda units in operation in Europe at the end of 2010
• …to continue in a steadily recovering segment post eco-incentive boom with the introduction of New Panda
The “Magic Box” since the ‟80s
A unique city-car offering simple yet ingenious solutions to everyday mobility needs
State-of-the-art safety, versatility, comfort and efficiency
Cars hitting showrooms in December in Italy; sales to start in January in Italy, then across Europe in February and later on in more than 40 countries outside Europe
0.8
1.2
1.7
1.2
1.6
2000 2008 2009 2011E 2014E
A-segment in EU27+EFTA
(million units)
Fiat: 2011 key product launches Renovating portfolio
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 14
• Successfully launched in mid June across key European markets with 20k orders taken to date
• FY target of ~120k units, 45-50k shipments expected in 2011
• Sales potential doubled vs. predecessor models thanks to first-time 5-door concept, leveraging also on strong customer base (1.5+mn car park)
• Competitive fuel-efficient powertrain offering
A true icon in MPV category with 13mn units sold in its history
• Based on significantly refreshed Chrysler Town & Country
• The most advanced safety systems in market today and the most advanced entertainment system in its class
• To be launched in Q4 in Europe
First global flagship, a RWD equipped with segment leading standards
• Derived from all-new Chrysler 300
• On sale from October in all European dealerships
• Elegance and dynamism in perfect tune with Italian style
• Based on significantly refreshed Chrysler 200
• On sale in 2012
Lancia/Chrysler: key product launches Transformation into a full-liner underway
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 15
Alfa Romeo Giulietta: Entered best-in-class club in C-Segment in 2011
• Best-in-class features in C-segment…
Handling & dynamic performance
Comfort
Safety
Quality
CO2 emissions in C-segment
121g/Km of CO2 for 1.4 MultiAir 170hp gas engine coupled with “Alfa TCT”
• …making Alfa Romeo Giulietta among best-in-class players in all main EU countries
• ~61k orders (100+k since launch in May 2010) to date
• ~58k shipments, fully in line with FY target of 90-100k units
~90% shipments with high trim level
• Share of 3% in EU27+EFTA in C-segment, the highest level ever for Alfa Romeo
• Fuel-efficient MultiAir technology
• Competitive diesel MultiJet II
• Dual Dry Clutch Transmission “Alfa TCT”, available in market starting H2
• Powertrains available across model range with best torque/power ratio compared to emissions
Alfa Romeo
Giulietta
Competitor
A
Competitor
B
Competitor
C
Competitor
D
Competitor
E
Competitor
F
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 16
Jeep New & refreshed vehicles gaining traction in Europe
Total Jeep up 41% to ~15K units
Year-over-year registrations increase largely due to performance of Wrangler and Compass
Compass: 4x last year levels
Wrangler: +66%
Several key markets experienced strong performance
Italy: +91%
Germany: +67%
France: +95%
Spain: +20%
Switzerland: +31%
Several product actions introduced to market in the quarter
Refreshed Compass launched in late April equipped with 2.2 CRD diesel engine ranging 136-163hp
Available with 2WD & AWD
2011 Grand Cherokee (the most awarded SUV ever) available with a new diesel engine since June
3.0 CRD available with 190hp & 241hp
Introduction of Laredo & Limited trims
Introduction of the 70th Anniversary package (April)
Available on Wrangler, Wrangler Unlimited & Compass
Package includes unique exterior badging and special interior trim
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 17
H1 „09 H1 „10 H1 „11
The shift in portfolio – The first evidence in H1 2011 (EU27+EFTA passenger cars)
• FGA gradually reducing dependence from smaller segments on the back of new product launches…
Alfa Romeo Giulietta contributing the most, with 220 bps share gain vs. prior year in C-segment
Strong pace for Jeep branded products resulting in greater presence in SUV segment (up 31% over same period in 2010)
• …while consolidating presence in lower spectrum of market…
Fiat 500 gaining 140 bps share in A-segment
Share gain of 20 bps by Punto in B-segment
…in expectation of full- quarter contribution of newly-launched Freemont & Ypsilon
42%
37%
7%6%
3%
1% 1%3%
0%
43%
35%
6%5%
3%
1% 2%
5%
0%
39%
34%
12%
3%2%
0%
4%4%
0%
Mini Small Compact Large MPV
Compact MPV &
MPV Large SUV LCV
derivatives
Others
12%
28%
22%
12%
4%
8% 8%
2%
5%
11%
28%
21%
11%
4%
9% 10%
2%
5%9%
25%
20%
12%
4%
9%
13%
2%
6%
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 18
• The most updated and complete product offerings of any EU producer
• Fiat Professional best in class in CO2 emissions and the widest CNG range in LCV market
• Strong distribution network
• Launched in May, a best-selling van whose 5 generations have received international awards and 2.2+ million units sold since 1981
Enhanced versatility to serve independent workers in various sectors, large fleets, convertible recreational vehicles and specialist transportation
Well structured and diversified product offering with ~2,000 different combinations of chassis, engine and mechanics
• Record-low consumption and CO2 emission levels (~15% reduction compared with Euro4 engines)
A step further with an extended range of Euro5 diesel engines ranging 115-177hp, also available in CNG version
Light Commercial Vehicles: Fiat Professional
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 19
Industry Units (000s)
Chrysler Group performance (H1 2011 vs. H1 2010)
Sales Market share
Key Messages (year-over-year)
+21% 9.9%
(up 70 bps)
+15%
14.8% (up 160 bps)
5,703
6,449
H1 2010 H1 2011
798 822
H1 2010 H1 2011
• Retail sales (excluding fleet) increased 43%
• Retail of retail market share* increased to 8.6%, up 160 bps
• Fleet mix at 31%, down from 42%
• Key performers included: • Jeep Grand Cherokee (+114%) • Jeep Compass / Patriot (+89%) • Chrysler 200 (32k vehicles sold) • Dodge Durango (24k vehicles sold)
• Retail sales (excluding fleet) increased 20%
• Retail of retail market share* increased to 12.9%, up 190 bps
• Key performers included: • Jeep Grand Cherokee (+130%) • Jeep Wrangler (+34%) • Dodge Journey (+53%)
* Company calculation; retail sales (excluding fleet) versus industry retail sales (excluding fleet)
Chrysler: sales in US & Canada outpace industry
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 20
Q1 Q2
+64% +196%
Q1 Q2
+19%
+13%
Q1 Q2 Q1 Q22010 2011
15k
8k
23k
10k
Q1 Q2
+64%
+112%
Key new vehicle contributors in US market New and redesigned vehicles launched in 2010 driving increased sales
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 21
1.5
2.3
0.6
0.3
0.4
0.1 0.1 0.1 (0.0) 0.0
0.4 0.0 0.0
0.2 0.1
0.1
0.2
0.2 0.1 0.1 (0.0)
0.1 (0.0) 0.0
0.7
0.3
0.8
0.1
0.4
0.4
0.8
0.3
0.4
0.4
0.5
2010 MarketDrivengrowth
Marketsharegain
NewMarkets
MarketDrivengrowth
Marketsharegain
NewMarkets
MarketDrivengrowth
Marketsharegain
NewMarkets
MarketDrivengrowth
Marketsharegain
NewMarkets
MarketDrivengrowth
Marketsharegain
NewMarkets
MarketDrivengrowth
Marketsharegain
NewMarkets
MarketDrivengrowth
Marketsharegain
NewMarkets
2014ETotal
growth
0.6
1.2
0.5
2.3
3.6
5.9
Market driven growth
Market share gain
New Market
0.8
0.1
0.5
0.3
0.4
0.1
0.1
(millions of units – Excl. JVs)
Critical mass, greater geographic diversification
Fiat & Chrysler combined volumes
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 22
The iconic assets
• Increase product differentiation to target new customers in the high-end sport cars segment
• Keep innovating with a new model every year to sustain turnover and reinforce brand
• Selectively exploit Special Series to target high-end customers and collectors
• Continuing search for opportunities in emerging markets, maintaining exclusivity in mature ones
• Personalization, one-off program, spare parts and after sales services improvement
• New generation of Quattroporte
• Extend luxury market coverage by entering high-end E and I segments
• Maintain and sustain GranTurismo and GranCabrio products in H segment
• Increase global market shares in all segments
• Dealer network improvement to support volume growth
• Production efficiencies and fixed cost optimization
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 23
Net profit (€mn)
Net industrial debt
(€mn)
Liquidity (€bn)
Fiat ex Chrysler improving €391mn before €881mn (US$1,268mn) paid to Chrysler for an incremental 16% ownership interest (on a fully diluted basis)
• Strong cash flow from operating activities
• Capex at €794mn, in line with FY guidance
• Dividend payments of €172mn
Revenues
(€bn)
Trading profit (€mn)
Trading margin
• Chrysler contributed €3.3bn for June
• FGA up 2.7%
• Double-digit growth for Luxury brands and Components
• Chrysler contributed €150mn for June
• Ex Chrysler, €68mn increase despite difficult trading conditions in Europe
• Strong performance at Components and Luxury & Performance brands
• FGA holding trading profit despite continued weak demand for passenger car in most European markets
• Fiat ex-Chrysler €0.9bn below Mar-end level, mainly reflecting disbursement for 16% stake in Chrysler
• Quarter-end position not inclusive of proceeds from recent €1.5bn bond issuances (settled on July 8, 2011) and disbursements for UST & Canada ownership stakes and UST rights under Equity Recapture Agreement
Q2 ‟11 highlights Significant improvements across the board, with and ex Chrysler
Note: Q2 ’10 figures are provided herein on a pro-forma basis to reflect a carve-out of Fiat operations from the historical Fiat Group financial statements
• FGA: 2.5%
• Ferrari: 13.9%
• Maserati: 5.4%
• Components & Production Systems: 3.4%
• Reported net profit reflects measurement of ownership interest in Chrysler upon consolidation, net of unusual charges, for €1,058mn
• Ex one-off items and related tax impacts, net profit of €156mn (ex Chrysler €76mn, up €68mn over Q2 „10)
(17)
489
13.1
9.4
307
3.3%
Q2 „10 Q2 „10
Mar-end „11
Mar-end „11
Q2 „10
Q2 „10
+6.5%
+22.1%
10.0
375
3.8%
Ex Chrysler
+40.2%
+71.0%
13.2
525
4.0%
Reported
Q2 „11
Ex Chrysler Reported
Q2 „11
Ex Chrysler Reported
Q2 „11
1,380
979
12.2
Ex Chrysler
1,237
3,407
19.2
Reported
Q2 „11
Ex Chrysler Reported
Jun-end „11
Ex Chrysler Reported
Jun-end „11
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 24
Given consolidation of Chrysler and improved performance of Fiat‟s other businesses, Group is upgrading guidance for FY 2011 as follows (with Chrysler contributing 7 months)
Revenues in excess of €58bn
• Revenues for Fiat ex Chrysler in excess of €37bn
Trading profit of ~€2.1bn
• Fiat ex Chrysler trading profit in upper-end of €0.9-1.2bn guidance
Reported net income of ~€1.7bn
• Fiat ex Chrysler net income (ex unusuals) of €0.3bn
Capital expenditure of ~€5.5bn
• Capital expenditures for Fiat ex Chrysler of ~€4.0bn
Net industrial debt for consolidated Group expected in ~€5.0-5.5bn range
• Net industrial debt for Fiat ex Chrysler in ~€2.0-2.3bn range
Liquidity expected at ~€18bn
• Fiat ex Chrysler liquidity well in excess of €11bn
2011 guidance confirmed
Note Guidance for Net industrial debt of Fiat ex Chrysler includes disbursements for purchase of: • 16% incremental ownership interest in Chrysler (US$1,268mn) • 6.0% ownership interest held by UST (US$500mn) and 1.5% ownership interest held by Canada (US$125mn) • UST’s rights under Equity Recapture Agreement between UST and VEBA (US$75mn)
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 25
A reminder of April 2010 Investor Day Fiat & Chrysler 2010-14 financial targets (pro-forma combined from 2010)
>32
37 45 57 64
32
41
45
48
52
>64
76
85
97
104
2.0%
4.0%
5.4%
6.3%
7.2%
2.2%
4.8%
6.2%
7.1%
8.0%
0%
2%
4%
6%
8%
10%
12%
14%
-12
8
28
48
68
88
108
128
2010E 2011E 2012E 2013E 2014E
Tradin
g m
argin
Net R
even
ues (
€bn
)
Fiat Chrysler Eliminations Trading margin range - Low Trading margin range - High
(IFRS) CAGR 2010-14 = 12%
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 26
What is the future of Fiat-Chrysler?
Totally shared • Architectures
• Powertrains
• Manufacturing strategies
Multi-brand
Multi-national
Multi-ethnic
"Halfway to heaven and just a mile out of hell” (Bruce Springsteen)
How will the automotive industry look going forward?
Two key truths of this industry
• Very capital intensive
• Highly sensitive to operating leverage
Consequence
• Limited number of players
- 5 or 6 global with 6+ million vehicles
• Highly-efficient industrially but with a keen sense of markets & brands
• Geographically diversified
• Ready to tackle Chinese threat
September 20, 2011 Sanford C. Bernstein – Strategic Decisions Conference 2011 27
Contacts
Marco Auriemma +39-011-006-3290 Vice President
Alexandra Deschner +39-011-006-2308
Paolo Mosole +39-011-006-1064
Sara Nicola +39-011-006-2572
Maristella Borotto +39-011-006-2709
fax: +39-011-006-3796
email: [email protected]
website: www.fiatspa.com