No new products in the pipeline. That’s the current situation in FCA after three years of continous launches. Back in 2015, the car maker started a new product offensive with the relaunch of Alfa Romeo and the arrival of the Fiat Tipo, 500X and 124 Spider. Then it was the turn for the Fiat Toro and Mobi in Brazil, and more recently the new Argo and new Jeep Compass. Maserati also introduced its first SUV. Any big car maker must have a continous product update plan if it wants to retain its market share.
But it seems that the company is entering in a new period of very few launches. Based on the current plan, FCA should reach the unreachable goal of 7 million units by 2018, or next year. In order to achieve this target, the group was supposed to launch 47 new cars* all over the world between 2014 and 2018. The ambitious plan presented in May 2014 included 8 new Alfa Romeos, 5 new Chryslers, 6 new Dodges, 20 new Fiats, 4 new Jeeps and 4 new Maseratis.
But 3 and a half years after the famous “Investor Day”, the numbers show a different reality. FCA has presented and introduced only 12 products of the 47 new cars announced in 2014. The company has only accomplished a quarter of the product plan and it has a bit more than a year to complete it. Marchionne says that FCA is now focused on reducing the debt and improving the profitability, which means that the volume goals are not his priority anymore.
But the company won’t be able to grow and become a real big player without more new cars. The truth is that its rivals are moving faster despite their own problems. Volkswagen Group continues dealing with the diesel and emission issues but at the same time goes on with its SUV offensive. PSA just got bigger and is investing in Iran and Magreb. Renault-Nissan is now one of the world’s top 3 best-selling car makers with big chances of dethroning VW and Toyota thanks to the Russian and Brazilian boost.
The problem is the lack of planning. FCA top management, aka Marchionne, is always changing plans, making more noise than cars, and waisting precious time to overcome its rivals. The best example of this is how late the car maker arrives to the parties. SUV boom started in Europe with the arrival of the Nissan Qashqai in 2007. It was soon followed by Volkswagen, Peugeot, Renault, Ford, Opel, Hyundai and many other mainstream brands. Then the premiums joined the segment, but FCA was still out of it. The group finally presented the Jeep Renegad and Fiat 500X in late 2014, early 2015, or 5 years after Dacia hit the market with the Duster. The same happened to the Maserati Levante, which was introduced 14 years after the first Porsche Cayenne was launched.
Another example is the lack of clarity regarding the electric cars. The big car makers and even the Chinese brands are investing billions to lead the electric car market in the next 10 years. Meanwhile many governments in Europe and even in China or India announce future bans on combustion engine cars. New and tougher emission regulations (WLTP) are set to complicate things even more. Despite all of these changes, FCA remains as one of the few big car makers without a clear plan regarding its electrification.
FCA is now working to improve its profitability and reduce its debt. This is certainly a good thing to do when you’re thinking to sell your company. At the end, Marchionne’s legacy will be a healthy company, with a higher stock market value and ready to get sold. And he will be also remembered for his optimistic product plans.