Product plan fiat_2012_2016

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Il piano prodotto Fiat dal 2012 al 2016

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Product plan fiat_2012_2016

  1. 1. Group’s views on European market and broad implications on its development plans for the future October 30, 2012October 30, 2012 1
  2. 2. Safe Harbor Statement Certain information included in this presentation, including, of the assumptions underlying this presentation or any of the without limitation, any forecasts included herein, is forward circumstances or data mentioned in this presentation may looking and is subject to important risks and uncertainties that change. Any forward-looking statements contained in this could cause actual results to differ materially. The Group’s presentation speak only as of the date of this presentation. We businesses include its automotive, automotive-related and other expressly disclaim a duty to provide updates to any forward- sectors, and its outlook is predominantly based on its looking statements. The future financial targets included in this interpretation of what it considers to be the key economic presentation were not examined or reviewed by Fiat’s auditor factors affecting these businesses. Forward-looking statements neither any other accounting firm. Such financial targets were with regard to the Groups businesses involve a number of based on numerous variables and assumptions that are inherently important factors that are subject to change, including, but not uncertain and may be beyond the control of Fiat’s management. limited to: the many interrelated factors that affect consumer Such future financial targets, such projections, by their nature, confidence and worldwide demand for automotive and become less reliable with each successive year. Accordingly, automotive-related products and changes in consumer there can be no assurance that the such financial targets will be preferences that could reduce relative demand for the Group’s realized and actual results may vary materially from those shown products; governmental programs; general economic conditions and as such no undue reliance should be placed upon such in each of the Groups markets; legislation, particularly that projections. Fiat does not assume and expressly disclaims any relating to automotive-related issues, the environment, trade liability in connection with any inaccuracies in any of these and commerce and infrastructure development; actions of forward-looking statements and projections or in connection with competitors in the various industries in which the Group any use by any third party of such forward-looking statements competes; production difficulties, including capacity and supply and projections. This presentation does not represent constraints, excess inventory levels, and the impact of vehicle investment advice or a recommendation for the purchase or sale defects and/or product recalls; labor relations; interest rates of financial products and/or of any kind of financial services. and currency exchange rates; our ability to realize benefits and Finally, this presentation does not represent an investment synergies from our global alliance among the Group’s members; solicitation in Italy, pursuant to Section 1, letter (t) of substantial debt and limits on liquidity that may limit our ability Legislative Decree no. 58 of February 24, 1998, as amended, nor to execute the Group’s combined business plans; political and does it represent a similar solicitation as contemplated by the civil unrest; earthquakes and other risks and uncertainties. Any laws in any other country or state.October 30, 2012 2
  3. 3. The planProgress to-date • New Chrysler formed out of “363” sale June 2009 with Fiat at 20% • Government loans repaid in May 2011, 6 years early; FIAT GROUP Fiat to 58.5% 75 67 • GEC formed to drive single management organization 3.2 2.3 Net revenues (€bn) with 4 regional hubs Sept 2011 Trading profit (€bn) • Chrysler sales activities integrated into Fiat in EMEA & * pro-forma LATAM 2010A* 2011A* • Fiat brand successfully launched in NAFTA with Fiat Trading margin (%) 3.4% 4.3% 500 early 2011 • Converged to 3 key architectures and launched first vehicle with New Panda (Mini), 500L (Small), Dart (Compact) 2010A 2011A • Maserati brand relaunch accelerating, 2 new sedans Targets (Apr 2010) Net Revenues (€bn) launching H1 2013 Fiat Group (pro-forma) >64 76 Lingotto Plan • Integrating Fiat LCV vehicles into RAM brand to Trading Profit (€bn) complete full-range commercial vehicle brand Fiat Group (implied pro-forma) >1.3 >3.0 • Completing worldwide powertrain offering with Fire Trading Margin 1.4 in NAFTA, Pentastar downsize for APAC, 8- Fiat Group (pro-forma) 2.0-2.2% 4.0-4.8% speed/9-speed planetary transmission • APAC business developing driven by Jeep SUV success, localization started with launch of Viaggio in China DECENT EXECUTION OF AN AMBITIOUS PLAN, WITH EMEA’S MARKET DECLINE HAVING • Purchasing & WCM progressing with significant savings, efficiency & capacity improvement FUNDAMENTALLY CHANGED THE LANDSCAPE • No longer a marginal player in global rankingOctober 30, 2012 3
  4. 4. Industry trend and forecast(mn units) NAFTA 18.3 LATAM (passenger cars, 17.7 17.7 18.2 (passenger cars & LCVs) ~17 7.1 SUV, pick-up 7.3 trucks & LCVs) 6.9 17.1 16.4 16.6 15.6 6.3 6.0 15.2 5.5 5.8 14.2 Chrysler forecast @ 2009 Investor Day 5.2 Fiat forecast @ 2010 Investor Day 13.5 Revised forecast Revised forecast 2010 2011 2012E 2013E 2014E 2015E 2016E 2010 2011 2012E 2013E 2014E 2015E 2016E APAC* 31 EU27+EFTA (passenger cars & LCVs) (passenger cars & LCVs) 29 18.2 17.4 27 16.5 15.4 25 14.4 15.3 15.6 ~24 14.9 13.9 14.1 13.9 14.1 Fiat forecast Fiat forecast @ 2010 Investor Day Revised forecast 2012E 2013E 2014E 2015E 2016E *Industry 2010 2011 2012E 2013E 2014E 2015E 2016E reflects aggregate key markets where Group is competing (i.e. China, India, Japan, Australia, South Korea)October 30, 2012 4
  5. 5. Flexible work practices have allowed us to deliveron strong market demand in the Americas CAPACITY UTILIZATION CAPACITY UTILIZATION Harbour definition Technical definition Harbour definition Technical definition 120% 160% 140% 100% 107% 143% 140% 140% 120% 80% 92% 100% 60% 73% 73% 80% 85% 85% 88% 60% 60% 40% 49% 40% 20% 20% 0% 0% 2010 2011 2012E 2010 2011 2012E INDUSTRIAL FLEXIBILITY 2.4 1.6 • Stable at ~90% utilization of technical capacity for many years • Consistent utilization of all flexibility instruments (extra-overtime and holidays) to maximize output FY 2010 Full utilization Efficiency Additional FY 2012E production including improvement production production (mn units) additional shifts (line speed through extra- (mn units) (Standard Union increases) overtime and Contract Terms) holidays Harbour definition: 235 days p.a. / 16 hours per day Technical definition: 280 days p.a./3 shifts per day for LATAM; 265 days p.a./3 shifts per day at all plants (ex Saltillo where applied 2 shifts at 285 days) for NAFTAOctober 30, 2012 5
  6. 6. But Fiat Group isn’t immune to the effects ofthe European “Carmageddon”… EXTERNAL MARKET FACTORS GROUP CAPACITY UTILIZATION IN EMEA • Slump in European market demand, with 2012 being (passenger cars & LCVs; including JVs; percent) the 5th consecutive year of decline  Expected 2012 volume of ~12.5mn passenger cars is the lowest level since 2007 and down 20+% from 16mn peak 88%  Italian market at <1.4mn units and down 40+% from 2.5mn peak in 2007 80%  European LCV volumes expected at ~1.6 million units and down 30+% from 2.4mn peak in 2007 ~69% • Pricing pressure, especially for mass market segments • Further pressure from Korean and potential Japanese 56% and Indian FTA’s 52% ~45% • Market becoming bi-polar with profitability limited to premium • Low-end brands increasingly relevant in mass market • Lack of visibility for recovery to pre-crisis level • Structural overcapacity of European manufacturers will delay any pricing recovery • Industry heavily regulated and no moves to simplify 2010 2011 2012E MARKET 2013 AND THEN EXPECTED TO BE FLAT IN Harbour definition Technical definition 235 days p.a. / 16 hours per day 280 days p.a. / 3 shifts per day GRADUAL RECOVERY TO ~15MN IN 2015/2016 (PASSENGER CARS & LCVS)October 30, 2012 6
  7. 7. Our strengths and weaknesses in EMEA Positive Negative • Mass-market brands with strong heritage, • Portfolio heavily skewed to A- & B-segment & extensive dealer network geographically concentrated in Southern European markets • A leading position in LCV market • Fiat 500 continued leadership in up-market A- • Inability to leverage Fiat brand to move into C- segment and above segment • Fiat Panda & Fiat Freemont success shows • Historical core segments have become commodity purchases with limited ability to effectiveness of focus on utility / price return capital employed proposition • Quality problems behind us & leadership in • Lancia–Chrysler integration hindered by market condition and limited brand appeal recent products out of all production locations outside Italy (Pomigliano/Tychy/Serbia) • European leadership in C02 emissions for 5 • Dealer network effectiveness still not ideal years in a row • Alfa Romeo brand opportunity limited by historic lack of industrial volume in C- & D- • Ferrari & Maserati unique iconic & profitable segment to leverage assets, with Maserati launching 2 new products in H1 2013 • Conserved cash through 2008-2012October 30, 2012 7
  8. 8. Our starting pointA wide array of differentiated, sustainable technologies • Twinair engine, 0.9L 2-cylinder: 90 • New generation of planetary • Totally electric vehicle, 83 kW motor g/km NEDC CO2 emissions on Fiat automatic transmissions for FWD, • 100-mile cruising range in urban 500 RWD and AWD applications cycle • 1.4L Turbo MultiAir engine: 41 EPA • Dual Dry Clutch spread across the • 100+ MPGe EPA label on combined highway mpg on Dodge Dart portfolio in EMEA, NAFTA & China cycle • The widest range of vehicles in EU • Fiat’s leadership in flex-fuel • Real-time, on-board feedback on • New Fiat Panda powered by Twinair technology in Brazil, utilizing how to improve driving style for fuel engine: 86 g/km NEDC CO2 emissions variable mix of gasoline and ethanol economy • New Fiat 500L coming in 2013 • TetraFuel first engine in the world • Available on Fiat 500L, standard on able to run 4 different fuels: petrol, uConnect infotainment system • Bio-methane application easily bioethanol, “gasolina”, natural gas • Recorded savings on off-board implementable: well-to-wheel CO2 emissions comparable to electric Eco:Drive up to 16% vehicles FOR THE FIFTH YEAR IN A ROW, EUROPEAN LEADER IN CO2 EMISSIONS IN 2012October 30, 2012 8
  9. 9. Solving the EMEA quandary REMAIN FOCUSED ON NON-PREMIUM MASS-MARKET AND 1 RATIONALIZE CAPACITY BY CLOSING 1 OR MORE PLANTS OR LEVERAGE HISTORICAL PREMIUM BRAND HERITAGE (ALFA 2 ROMEO & MASERATI), RE-ALIGN PRODUCT PORTFOLIO AND REPOSITION THE BUSINESS FOR THE FUTURE We have chosen the second option because • We have installed up-to-date available capacity in EMEA and have little capacity left elsewhere • We have at least 3 brands that are capable of competing in the higher margin business • Fiat-Chrysler has developed over the last 3 years the relevant architectures and baseline powertrains to enter the premium end of the business and • Fiat-Chrysler has access to the NAFTA and APAC marketsOctober 30, 2012 9
  10. 10. Our strategy going forward 1. Focus Fiat brand on 500 and Panda as pillar vehicles (brands within a brand) and derive all future products therefrom 2. Reduce/curtail Lancia exposure, preserving uniqueness of Ypsilon and rely on Chrysler’s NAFTA development to feed European brand, if economically viable 3. Focus on Alfa Romeo and Maserati to access higher-end of bi-polar market 4. Fully flesh out Jeep brand by developing appropriate products for European and international markets 5. Continue to develop and maintain leading position in LCVs OVERRIDING OBJECTIVES ARE: 1. TO UTILIZE EMEA PRODUCTION BASE TO DEVELOP OUR GLOBAL BRANDS (ALFA ROMEO, MASERATI, JEEP AND THE FIAT 500 “FAMILY”) 2. TO SHIFT A SIGNIFICANT PORTION OF PRODUCT PORTFOLIO TOWARDS HIGHER MARGIN OPPORTUNITIESOctober 30, 2012 10
  11. 11. Major new model launches in EMEA(SoP within each year indicated) 2012 2013 2014 2015 2016 NOT CURRENTLY IN PRODUCTION ANYWHERE VEHICLES IN ITALY only for EMEA for EMEA and export IN ITALY for EMEA New model MODEL IMPORTED PRODUCED IN only for EMEA REFRESH for EMEA and export VEHICLES Refresh EMEA OUTSIDE ITALY for EMEA and export OUTSIDE ITALYOctober 30, 2012 11
  12. 12. Synergies on capital and costUtilize European manufacturing base for WW volume growth • Products needed for competitive offering in Europe are complementary to those produced in NAFTA and LATAM where production capacity is or will soon be saturated as Chrysler product offering continues to be renewed through 2015 • Target to utilize up to 15% of capacity for export, especially for Jeep smaller SUV (not currently in production anywhere), Alfa Romeo and Maserati brands • Architecture allocation • Italian footprint for higher value-added production • Focus ex-Italy on smaller segments • Working with Italian Government on actions to improve competitiveness for export • New Union agreement in place which addresses labor flexibility issue but need full adherenceOctober 30, 2012 12
  13. 13. Our new EMEA Targets • 2012 confirmed Trading Loss of ~€700 million • 2013 European market expected to be flat and EMEA loss expected at similar or slightly lower level • Actions on product plan and commitment of capital to Italian manufacturing sites • are dependent on respect and compliance with new labor agreements; • will require 24-36 months for implementation and • will allow Fiat-Chrysler in EMEA to recover some market share in a more rational market and to act as export base for sales by other regions • Break-even achievable in 2015-16October 30, 2012 13
  14. 14. 2012-14 Group financial targetsOld vs. new plan (IFRS) 2012E 2013E 2014E Investor Day Investor Day Investor Day Revised Revised Revised 2010 2010 2010 Volumes ~4.8 ~4.2 ~5.5 4.3-4.5 ~6.0 4.6-4.8 (units/000) Revenues ~85 ~83 ~97 88-92 ~104 94-98 (€bn) Trading Profit ~4.6 ~3.8 ~6.1 4.0-4.5 ~7.5 4.7-5.2 (€bn) Trading ~5.4% ~4.6% ~6.3% 4.6%-4.9% ~7.2% 5.0%-5.3% Margin EBITDA (€bn) 9.8-10.6 ~8.0 11.9-12.7 9.0-9.5 13.8-14.6 10.3-10.8 EBITDA % ~11.5% ~9.6% ~12.3% ~10.3% ~13.3% ~11.0% Capex (€bn) ~8.0 ~7.5 ~6.2 7.5-8.5 ~6.2 8.5-9.5 Capex/D&A ~1.5 ~1.9 ~1.1 1.6-1.8 ~1.0 1.6-1.8 ratioOctober 30, 2012 14
  15. 15. Some conclusions • EMEA will continue to provide great challenges for everyone for many years to come • Fiat-Chrysler decision to shift product portfolio is the preferred choice because • It is the best economic alternative • Group has all necessary elements to execute (brands, architectures, powertrains, installed capacity and experienced workforce) • Group can manage financial requirements for implementation NOT FOR THE FAINT-HEARTED, BUT A POTENTIALLY EXCITING FUTUREOctober 30, 2012 15
  16. 16. Contacts GROUP INVESTOR RELATIONS TEAM Marco Auriemma  +39-011-006-3290 Vice President Alexandra Deschner  +39-011-006-2308 Timothy Krause  +1-248-512-2923 Paolo Mosole  +39-011-006-1064 Sara Nicola  +39-011-006-2572 Maristella Borotto  +39-011-006-2709 fax: +39-011-006-3796 email: investor.relations@fiatspa.com websites: www.fiatspa.com www.chryslergroupllc.comOctober 30, 2012 16

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