Fiat-Chrysler losses rivals Ford’s
Fiat Chrysler (FCA) lost $1.84 billion last quarter, nearly as steep as Ford’s $2 billion loss. Net revenue fell by 16%, dropping to $22.3 billion. The company’s adjusted net loss was roughly $514,000.
Debt servicing was the main issue for FCA, which only last year celebrated having no net debt—balancing debt with cash—after years of working to pay off the acquisition of Chrysler and investments in plant upgrades. The company cleared $56 million before interest and taxes.
Surprisingly, while volume sales in North America fell by 16%, net revenue in the continent only fell by 9%; earnings before interest and taxes (EBIT) fell by 48%, to $594 million. North America was the only region where FCA had a positive EBIT; it was –$64 million in Asia-Pacific, –$295 million in Europe/Middle East/Africa, and -$29 million in Latin America. Maserati posted a global $75 million loss before interest and taxes, with shipments down by 44% and revenues down 46%.
Globally, shipments fell by 21% to just 818,000. Asia-Pacific shipments were roughly half of what they were in the first quarter of 2019 — just 4% of North American shipments in Q1 2020. Shipments in Europe, the Middle East, and Africa (EMEA) fell by over 30%, with net revenues down by 26%. Combined EMEA shipments were less than half of those in North America alone. Likewise, Latin American shipments, which only fell by 12%, were less than a quarter of those in North America. (For those adding it up at home, North American volume was greater than all other regions combined.)
The company had been profitable for years before the effects of the coronavirus struck, and had been building a cash reserve while paying off debts; FCA was able to get a new $3.8 billion credit line in April to help make it through the economic shutdown.
Clark Westfield grew up fixing up and driving past-their-prime American cars, including various GM and Mopar V8s. He has ghostwritten auto news for the last few years, lives in Farmingdale, New York, and can be reached at +1.516-531-4021.