SA News • Fri, Jan. 23
- Constantly increasing market share in North America.
- Jeep and Maserati brands fast gaining ground worldwide.
- Positive financial effects from floating off Ferrari and bond issuances.
- Superstar CEO Marchionne set to stay until 2018.
- Possible mergers on the cards.
More Efficient Commercial Work Vans Reduce Demand For Gasoline
- New kinds of work vans come in more optimal and efficient sizes.
- These new and lighter sizes, combined with better engines and transmissions, can reduce gasoline consumption by 50%.
- New models from Ram, Ford and Nissan are now flooding the US market, and people are junking their old, inefficient commercial work vans.
- I did a comparison test and found the all-new 2015 Ram ProMaster City to be particularly attractive on all metrics.
- The Ram ProMaster City has the drive comfort and handling dynamics of a good new car, which is a new benchmark for a commercial work van.
Why Fiat Chrysler Shares Fell Back To Earth In December
- Fiat Chrysler Automobiles FCAU priced an expected sale of 87 million common shares at $11 apiece, a 19.7% discount to the stock price on December 11.
- For a short time, an arbitrage opportunity exists to sell shares at the current higher price, and buy them back at a discount through the secondary offering.
- FCAU's $2.5B convertible bond offering triggered further selling as convertible arbitrageurs set up their initial delta hedges.
- Once these 2 offerings are allotted and sold, the selling will cease and the stock price will rise.
Sergio Marchionne Is The Reason To Back Fiat-Chrysler
- Fiat CEO has turned the company around with bold strategic moves.
- Marchionne interested in the long-term,not in what analysts want short-term.
- Ambitious 5-year plan is achievable.
- Chrysler Easily Out-Performing Ford and GM in North America.
- Talk of Possible Tie-Up with Volkswagen Would be an Exciting Development.
- Fiat is trying to push that its brand is stylish and hip, but it may have gone too far.
- Sales rose 18% in May and 17% since the beginning of the year, but the new ad campaign may cause a slowdown.
- Fiat's new ad campaign is courageous but very risky. Fiat should focus its marketing on its practicality and quantifiable facets instead of offending the senses.
- Fiat Chrysler Automobiles (FCA) presented recently its ambitious five-year strategic plan, aiming at strong growth and higher profitability during 2014-2018.
- Its targets are mainly dependent on major expansion of both the Jeep and Alfa Romeo brands, which are expected to post unit sales CAGR of 22% and 40%, respectively.
- No equity issuance is expected, net debt should be stable until 2016, and free cash flow should improve, something that the market is clearly questioning if it is reasonable.
- Despite the low likelihood of this plan being achievable, Fiat has good value over the long term, even if the company does not completely deliver on its targets.
Fiat Chrysler: The Valuation Is Cheap Even If You Do Not Believe In The 2018 Targets
- Investors gave little credit yesterday to Fiat’s 2018 targets: the group plans notably to increase its net income to around EUR5bn in 2018 from EUR0.9bn in 2013.
- They also remained concerned about the group’s balance sheet.
- But we remain confident that a mix of capital increase, disposals and improving cash generation will gradually reduce the group’s debt and the stock beta and sustain the rerating.
- Even assuming a 30% miss on 2018 targets and a capital increase, the stock’s 2018 P/E would be cheap around 3.5x.
- Cheap valuation – absolute and especially on relative basis vs General Motors and Ford.
- A very solid CEO - Sergio Marchionne was the 5th CEO in just 2 years before he took over in 2004.
- Boost from recent Chrysler acquisition - Fiat is now the 7th largest auto company in the world.
- Bad economic conditions in Southern Europe - have affected the company negatively.
- New premium strategy - less vulnerability to cyclical economic downturns.
A Call On The European Car Industry: Long Peugeot, Short Fiat
- How to get exposed to a recovery of European car industry? Be long Peugeot, short Fiat.
- Peugeot's new "ticket," with Tavares as CEO and Gallois as chairman, is very promising.
- Product lineup is far richer at Peugeot than at Fiat.
- Geo mix: A call option on China for Peugeot, vs. U.S. exposure for Fiat.
- Valuation: Two cash-burning companies, but Peugeot looks cheaper on multiples.
Fri, Jan. 23, 10:35 AM
- The conference call is scheduled to begin at 9.00 a.m. ET (2.00 p.m. GMT / 3.00 p.m CET).
- Consensus view is EPS of $0.30 on revenues of $25.50B.
Thu, Jan. 22, 1:06 PM
- Sales growth at Fiat Chrysler Automobiles (NYSE:FCAU) could slow this year after the automaker topped the pace of major rivals in 2014.
- Analysts note the year-over-year comparison becomes trickier for Fiat Chrylser at the expanded scale.
- To meet its 2015 target of 5M deliveries, Fiat Chrysler would need to improve deliveries by 5.2% to 5M.
Fri, Jan. 16, 7:35 AM
- Fiat Chrysler Automobiles (NYSE:FCAU) car registrations +7.2% to 55,863 units in December, according to the European Automobile Manufacturers Association.
- YTD registrations +3.5% to 767,856 units.
- Market share: 5.6% in December, 5.9% for the year.
- Results include the Fiat, Lancia, Alfa Romeo, and Jeep brands.
- EAMA release (.pdf)
Tue, Jan. 13, 9:36 AM
- Barclays initiates coverage on Fiat Chrysler Automobiles (NYSE:FCAU) with a strong Overweight rating.
- The investment firm makes its call with Fiat Chrysler CEO Sergio Marchionne in full swagger with reporters at the Detroit Auto Show.
- The global automaker has some of the highest growth targets in the sector.
- Previously: Highlights from the Detroit Auto Show (Jan. 12 2015)
Mon, Jan. 12, 11:30 AM
- Fiat Chrysler Automobiles (FCAU +1.4%) CEO Sergio Marchionne says the company is still on track to meet its aggressive 5-year growth target.
- Part of the automaker's plan is to reinvigorate the Alfa Romeo brand into an alternative to BMW to Volkswagen in various segments.
- Marchionne is in Detroit for the annual show where he's expected to make more off-the-cuff remarks.
Wed, Jan. 7, 8:02 PM
- Sales of electric vehicles in the U.S. rose 23% to 119.7K in 2014, according to a summary from InsideEVs.com.
- December was the peak month of the year with EV sales of 12,784 units.
- 2014 EV sales by model (estimated): Nissan Leaf 30.2K, Chevrolet Volt 18.8K, Tesla Model S 17.3K, Toyota Prius 13.2K, Ford Fusion Energi 11.55K, Ford C-Max Energi 8.4K, BMW i3 6.09K, Smart ED 2.59K, Ford Focus Electric 1.96K, Fiat 500e 1.79K, Cadillac ELR 1.31K, Toyota RAV4 1.18K.
- Plug-in entries from Porsche, Honda, Kia, Volkswagen, and Mitsubishi all recorded sales of less than a thousand for the year.
- Related stocks: OTCPK:NSANY, GM, TSLA, TM, F, OTCPK:BAMXY, OTCPK:DDAIF, FCAU, OTC:HYMLF, OTCQX:VLKAY.
Tue, Jan. 6, 8:20 AM
- The spinoff of Ferrari could give Fiat Chrysler Automobiles (NYSE:FCAU) enough breathing room to seek a merger partner, according to auto industry analysts.
- The rising cost of developing clean cars in Europe and the U.S. sets the stage for automakers to join forces through mergers and extended partnerships.
- "Eventually it must happen," notes FCA chief Sergio Marchionne on the topic of mega-mergers.
- No company is too big to be ruled out of the merger discussions due to the benefits of scaling investment costs and matching strengths/weaknesses in Europe, Latin America, China, and the U.S, note insiders.
- Automakers: GM, F, TM, FCAU, HMC, OTCPK:NSANY, TSLA, OTCQX:VLKAY, OTCPK:DDAIF, OTC:HYMLF, OTCPK:BAMXY, OTCPK:FUJHY, OTCPK:MMTOF, OTCPK:PEUGF, OTC:RNSDF, TTM, KNDI. OTCPK:SZKMY, OTCPK:MZDAY.
Mon, Jan. 5, 12:34 PM
- The average transaction price paid for a vehicles in the U.S. during December rose 1.9% Y/Y and 1.1% M/M to $33,168, according to an estimate from TrueCar.
- ATP changes (Y/Y): Hyundai (OTC:HYMLF) +9.4%, Subaru (OTCPK:FUJHY) +4.3%, Volkswagen (OTCQX:VLKAY) +3.7%, Nissan (OTCPK:NSANY) +2.7%, General Motors (NYSE:GM) +2.4%, Ford (NYSE:F) +2.2%, Fiat Chrysler Automobiles (NYSE:FCAU) +1.9%, Kia +1.7%, Honda (NYSE:HMC) +1.2%, Toyota (NYSE:TM) -1.3%.
- Incentive spending as a percentage of ATP was up 8.7% in December vs. +8.8% in November and +8.4% a year ago. The Big Three Detroit automakers were on the higher end, while Subaru and Toyota were the tightest of the bunch.
- Previous on U.S. auto sales: Fiat Chrysler Automobiles, Ford, General Motors, Toyota
Mon, Jan. 5, 8:21 AM
- Fiat Chrysler Automobiles (NYSE:FCAU) reports sizzling growth for its Chrysler and Jeep brands to close out the year.
- Brand sales growth: Fiat +1% to 3,784; Chrysler +53% to 30,930; Jeep 19% to 63,274; Dodge -2% to 46,578; Ram +35% to 48,628.
- Model sales growth: Jeep Patriot +53% to 9,434; Jeep Wrangler +16% to 14,003; Jeep Cherokee +18% to 17,715; Dodge Dart +26% to 6,881; Dodge Ram P/U +32% to 44,222; Chrysler Town & Country +10% to 10,709; Fiat 500L +4% to 1,482; Alfa Romeo 4C (new) 67.
- The automaker says it ended the month with 72 days supply of inventory vs. 80 days last month.
Mon, Jan. 5, 8:14 AM
Thu, Jan. 1, 3:41 AM
- More than 60M vehicles were recalled in the U.S. in 2014, totaling an average of about two announcements a day and affecting the equivalent of one in five vehicles on the road.
- GM's (NYSE:GM) defective ignition switch, Honda's (NYSE:HMC) Takata (OTCPK:TKTDY) air bag crisis and Fiat Chrysler's (NYSE:FCAU) flammable gas tanks led the group, doubling the previous U.S. annual recall record set in 2004.
Dec. 23, 2014, 2:10 PM| 1 Comment
Dec. 22, 2014, 11:34 AM| 1 Comment
Dec. 22, 2014, 10:49 AM
- TrueCar projects automobile sales in the U.S will rise 2.6% to 17M next year.
- The research firm forecasts the average transaction price of new vehicles will increase 2.4% to a $32,589.
- TrueCar's models to watch: Ford F-Series, Mazda CX-3, Mercedes-Benz GLA.
- Related stocks: GM, F, TM, FCAU, HMC, OTCPK:NSANY, OTCPK:DDAIF, OTC:HYMLF, OTCPK:BAMXY, OTCQX:VLKAY, OTCPK:FUJHY, KMX, CRMT, AN, OTCPK:MZDAY, LAD.
Dec. 22, 2014, 9:27 AM
- A tense period of negotiations between the UAW and the Detroit Three (GM, F, FCAU) automakers is expected to build in advance of the expiration of current labor contracts in September of 2015.
- The labor group is looking to close a large gap between hourly wages for automobile industry entry-level workers and legacy employees.
- What to watch: There will be a thin line for the UAW in pushing for its increases without giving Japanese automakers OTCPK:NSANY, TM, HMC, OTCPK:MZDAY, OTCPK:SZKMY, OTCPK:FUJHY, OTCPK:MMTOF an edge over the Detroit Three.
Dec. 19, 2014, 3:00 PM
- U.S. automobile sales are forecast to increase 11% in December to an annual selling rate of 16.6M units, according to a fresh forecast from TrueCar.
- The research firm says the industry benefited from lower gas prices and a better month of weather than was seen a year ago.
- For the full year, TrueCar expects total U.S. vehicle revenue to be up 8.3% to close to $1T.
- Transaction prices on new cars are up 1.9% to $31,831 YTD.
- Used vehicle sales are up 3.3% for the year.
- Related stocks: GM, F, TM, FCAU, HMC, OTCPK:NSANY, OTCPK:DDAIF, OTC:HYMLF, OTCPK:BAMXY, OTCQX:VLKAY, OTCPK:FUJHY, KMX, CRMT, AN, LAD.
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