Some two weeks ago Sergio Marchionne, one of the industry’s most polarizing figures, presented to investors the five-year plan for the Fiat Chrysler Automobiles (FCA) group. A lot of ink has already been spilled analyzing the announcements, as well as models and whole brands missing from the presentation, so we won’t aim to add to that at this [Read more…]
With production of the Chrysler 200 midsized sedan set to end next December, the illustrious brand will be down to just two models: the now almost elderly 300 large sedan, which shares its platform with the Dodge Charger and Challenger, and the brand new minivan Pacifica. That means the two namesake brands of Fiat Chrysler Automobiles are also its weakest volume brands in the North American market. And considering Chrysler cars are sold almost exclusively in the US and Canada, the brand doesn’t seem all that relevant anymore. That’s unfortunate for a brand which used to be one of America’s most innovative brands with a number of important technological breakthroughs to its name and which of course is credited with the creation of the minivan. However, for the past decades Chrysler has let its image crumble by selling mediocre cars and ongoing financial uncertainty under multiple owners as it has gone through a number of (near-)bankruptcies.
Let’s talk about automotive mergers again, because Sergio Marchionne, CEO of Fiat-Chrysler Automobiles, keeps going on about them being necessary to achieve the economies of scale needed for automakers in the current, highly competitive marketplace, and in order to spread the cost of investments in fuel efficiency, connectivity, autonomous driving and electrification. Okay, in all honesty, Sergio isn’t the only one saying it’s becoming “too expensive to make cars”, but he is the most outspoken one on the subject and he keeps flirting with other automakers to merge, most notably General Motors, so he’s an easy target for my rants.
And to a certain degree I can relate with him. Like he says, it doesn’t make any sense at all for every single automaker to develop -for example- hydrogen fuel cell technology in-house, so each of them has to “invent the wheel” by all themselves. Of course it would save tons of money for the automakers, and therefore for new car buyers, if development costs of a new technology could be spread among a cooperation of automakers, but guess what? This already happens a lot without any of them having to actually merge. Besides that, a lot of technologies in vehicle safety or fuel efficiency already get developed by suppliers, like Bosch, Magna or Denso, who then sell a license to the technology to a number of automakers, and thus spreading the development costs. [Read more…]
It really didn’t come as a surprise when Fiat-Chrysler Automobiles announced that it would withdraw the Chrysler brand from the UK market this week. Right-hand drive American MPVs, large sedans and rebadged Italian hatchbacks just didn’t vibe with the British car buying public. With the Jeep brand currently red-hot all over Europe thanks to the successful launches of the new midsized SUV Cherokee and even more so of the small crossover Renegade, the company has decided to dedicate its resources in the UK to its SUV brand.
Chrysler’s UK sales have dwindled to less than 2.000 units last year, but haven’t been above 3.400 in the last 6 years, which is approximately the number of Fiat 500 minicars the company sells every month in the UK market. Production and sales of the Delta compact had already been suspended last year, and the slow-selling RHD 300C large sedan (88 units in 2014, just 2 in January 2015) and Voyager MPV (2014: 565 units, January 2015: 5) will be discontinued as we speak, while the Ypsilon minicar (1.411 units in the UK last year) will be sold on customer’s request until the end of 2017. [Read more…]
After the first nine months of 2014, the minicar segment is still in negative territory, although just. Sales are down 1% or less than 5.000 units on last year, which means sales have improved in the third quarter, thanks to a strong performance for the segment leader Fiat 500 and the new generation Kolin triplets.
The Fiat 500 goes from strength to strength and seems to be unstoppable. In September, European sales of the already six-year-old model were above the 20.000 cars per month mark for only the second time ever, after last March. The 500 hasn’t just confirmed its leadership of the segment, which it took from the Panda exactly one year ago, it even added more sales than any other model in the segment, increasing its share of the segment to 15%. By itself, the 500 sold almost as many cars as the Volkswagen Up!, Skoda Citigo and Seat Mii combined.
The Panda holds on to the second spot, followed by the VW Up! which has remained stable on last year. The fastest growing model in the top 15 of the segment is the Hyundai i10, which has been renewed at the end of last year. Sales of the new generation are up one third compared to its predecessor in the first nine months of 2013. If the i10 manages to hold on to its fourth place of the segment by the end of the year, it would be an all-time best for the model. [Read more…]
Sales in the European minicar segment are down 2% in the first half of 2014, as a number of important models have just been renewed or will be in the second half of the year. The new generation of the Kolin triplets Citroën C1, Peugeot 107/108 and Toyota Aygo have started sales in June and won’t reach their full potential until the third quarter. Thanks to an excellent first quarter with sales increasing 20%, the Aygo is actually still up for the first half, but the C1 and 107 are down about 25%.
Also in showrooms later this year are the new generations of the Renault Twingo and Smart Fortwo, both on the same rear-engined, rear-wheel drive platform, and both outgoing generations down about 12% on last year. [Read more…]
Sales of minicars in Europe are growing again in the first quarter of 2014 after a slight decline in 2013, although the growth is still behind other segments, at 3% vs. 7% for the whole market. Forecasts for this segment are showing a 20% growth in the next three years, thanks to new arrivals like the Renault Twingo, the PSA-Toyota triplets and the Smart Fortwo this year . As a result of this product offensive, 6 out of the top 15 models will be either all-new or just refreshed by the end of 2014, and 13 out of the top 20 will have been renewed or refreshed in the last four years. Another reason for the expected boom in this segment is the rebound of sales in Italy, which is Europe’s largest minicar market. Italy has been in a sales slump in the last couple of years, dipping to levels not seen since the 1960’s.
The Fiat 500 is holding on to the first position it took from the Fiat Panda last year. After 2 months, the Panda was in the lead of the segment, but the 500 had an excellent month of March, outselling its sister by almost 7.000 units. This underscores the popularity of the 500 in the UK, where the model regularly scores a monthly top-10 position. It was the 8th best selling car in the UK in March, which is traditionally by far the biggest selling month of the year, thanks to the changeover to the new license plates. [Read more…]
When Fiat took control of Chrysler in 2009, Fiat-Chrysler CEO Sergio Marchionne drew an ambitious five-year turnaround plan for the bankrupt American automaker, promising better product, improved quality, higher sales and profitability and independence of government ownership by 2014. On May 6th, a new five-year plan will be announced, which means it is time to look back at the previous plan and see how the company has fared in the past half decade.
Marchionne promised to more than double Chrysler Group sales from 1,3 million units in 2009 to 2,8 million sales in 2014. These numbers may be a bit misleading, as 2009 was a disastrous year for Chrysler, and a two month production shut down during its Chapter 11 bankruptcy procedure didn’t help either. But still, when comparing the 2014 goal with the 2008 score of 2 million sales, it would still mean a 40% increase in 6 years.
In 2013, Chrysler Group worldwide sales increased 9% to 2,4 million. In order for the 2014 target to be met, sales would have to grow another 16,7% this year. This target was reiterated in the 2013 financial report, so Chrysler itself is still confident the goal will be reached. In the first quarter of 2014, Chrysler Group US sales, which represent three quarters of the company’s worldwide sales, where up 11,1% on 2013, so the company probably needs to increase its momentum in order to reach the 2,8 million sales. [Read more…]
The minicar segment in Europe has changed at the same pace as the rest of the market, at -2% from 2012 to 2013. This year, the segment has a new sales leader: the already 6-year-old Fiat 500 has surpassed its sibling Fiat Panda to take the crown of the segment for the first time.
The VW Up! is closing in on the Panda as well, as it leaves its twin siblings Skoda Citigo and Seat Mii far behind. The Up! actually sold almost double of the other two combined. This is a very skewed ratio compared to the PSA/Toyota-triplets, which are less then 2.000 sales separated from each other.
The Lancia Ypsilon has gone from -4% and #10 after three quarters to +3% and #7 by the end of the year. It has sold pretty good in Italy, where almost 80% of Ypsilons are sold. Lancia is likely to stop selling cars outside of Italy, and will discontinue all other models as well, considering three quarters of all Lancias sold are Ypsilon. [Read more…]
With GM CEO Dan Akerson stepping down next January to make room for Mary Barra, the first female CEO of a global automaker ever, General Motors no longer has a “change agent” at the helm, but a “car-girl” instead. Akerson has long said that he was not a long-term man for the job, and that he was in the position to turn GM around after the bankruptcy and would step down as soon as he felt the company would be prepared enough for the future, to leave General Motors in the hands of a leader who would take the company to the next level.
Meanwhile, at Fiat-Chrysler, a change-agent is still in charge with CEO Sergio Marchionne in the triple role of CEO of Fiat, Chairman and CEO of Chrysler Group, and Chairman of Fiat Industrial. Marchionne is credited for saving Fiat and then taking over the bankrupt Chrysler and saving this too. Both times, he managed to take the company from (near) bankruptcy to profitability within 2 years time. He is a true “company doctor”, so why didn’t he step down when Fiat was profitable again and leave the management to a leader who is specialized in running an already healthy company? And why is he still in charge of Chrysler now that it’s back on track? [Read more…]