2013: Best wishes to all and especially to Fiat Group

Fiat-Chrysler 2012-2013The new year is right here so it is time for the best wishes and a quick outlook at the main events of the ending year. So here there is my quick analysis and predictions for the coming year.


  • 2012 was the year in which roles changed: Fiat went from being the rescuer of Chrysler to become the rescued. Though the Italians don’t have any problems of cash, I just wonder what would be its situation if it wasn’t of Chrysler. Current European crisis hits the weakest auto makers and certainly Fiat is one of them. Fiat does not control the totality of Chrysler yet, and therefore it can’t access to its cash, but its position in automotive world is much stronger thanks to Chrysler results in America.
  • Awesome performance of Chrysler in USA. It had the best sales’ growth among the 3 of Detroit. The interesting thing is that Chrysler made it without the help of any all-new model (except for the Dodge Dart). The result is mainly explained by the recovery of US car market and the great Marketing and Advertising campaign of the group.
  • Brazil was again Fiat’s main market with excellent results. 2012 is the best year ever with a record month in August with more than 100.000 units delivered. However Fiat’s pole position began to be affected by the arrival of new and powerful players.
  • As a global player, Fiat-Chrysler knows it must be present everywhere. 2012 was the year of the come back of the group to Chinese market. The JV with GAC allowed Fiat to start production of the Viaggio, based on the all-new Dodge Dart. The Dart is the first totally made car developed from zero by Chrysler and Fiat together. It is expected to hit both, American and Chinese market, and to arrive in Europe in 2013.
  • Too bad for Fiat-Chrysler in India and Russia, the other key markets to become an important global player. In India Fiat decided to sell directly its cars and announced the introduction of Jeep brand. In Russia poor results for Fiat brand as they are waiting for the start of the construction of a plant along with Jeep models.
  • As a part of Marchionne’s intentions of expanding the business, Mazda and Fiat agreed to start the production of their fist car together. Alfa Romeo will have its roadster back and Mazda will have a great successor for its great MX-5. And this may not be the last project together as both companies are interested on sharing costs for their future small cars. Fiat-Chrysler needs urgently a partner in Asia so it could become a real threat for Toyota and VW. The best candidates are Suzuki or Mazda.
  • During the year the group presented the new Fiat 500L, the new Fiat Siena, the Lancia Flavia, Maserati Quattroporte, Ferrari F12, the Fiat Viaggio. They showed also the new Dodge Dart and Viper. The models to say goodbye were the Polish Fiat Panda, the Fiat Idea and Lancia Musa, the Alfa 159, Brera and Spider and Ferrari 599. The Dodge Caliber did also say goodbye, and so the Jeep Cherokee/Liberty and Dodge Nitro.


  • The new year will be a difficult one for Fiat-Chrysler. The whole group is expected to sell 4.2 million from 4 million in 2012. The growth will come from Chrysler division in USA, where rise will continue but slower. Fiat will face tough times as Europe will continue to suffer and competition will get hard in Brazil. Good previsions indicate that European car market will perform as bad as 2012. 
  • Great expectations for the Viaggio in China. If all forecasts are met, this car would be the first of more models to be built locally. Jeep will start production of its SUV there.
  • 2013 will be an important year for the future of Alfa Romeo. After many failures, the revival of the brand must work and will start in late 2013 with the introduction of the all-new 4C, which will be in charged of improving Alfa Romeo’s image in Europe and increase the brand’s awareness in America. In terms of sales, Alfa Romeo could face its worst year.
  • Along with Alfa, Jeep will be also another protagonist of the group. Local production is expected to start in late 2013 in Italy and China, while it will be officially launched in India (imported only). Jeep is considered the only truly global brand of the group (besides Ferrari).
  • In USA Fiat brand will increase its range of products with the introduction of the 500L made in Serbia. Fiat wants to replicate the success of the small 500, selling the minivan version everywhere. That’s why during 2013 lot of information should come from the small SUV they are building in Italy for both, Fiat and Jeep brands.
  • In 2013 it is expected the presentation (which does not mean introduction) of Fiat 500XL (the 7 seater version of the 500L), the Fiat Viaggio for Europe, the Alfa Romeo 4C, the Maserati Ghibli and the successor of Ferrari Enzo. In America we will see the new C-hatchback for Chrysler and the successor of the 200, the new Jeep Cherokee and maybe the new Jeep Compass/Patriot. They may anticipate the next Chrysler Town & Country/Dodge Caravan, and the future mid-sized Dodge (Barracuda?). Meanwhile the Fiat Bravo and Lancia Delta will say goodbye. The same will happen to the Italian Lancia Ypsilon, current generation Maserati Quattroporte, and maybe Jeep Compass/Patriot.

Italy: 500L helps Fiat to keep its share in Nov/12

Photo by: Ansa.it

Photo by: Ansa.it

One more terrible month for Italian car market. In November 2012 the market fell 20.1%, which is as bad as the months before October, when the fall slowed down (-12.4%). One year ago the market fell 9.3% compared to November 2010, but two years ago, in November 2010, the market had a deeper fall (-21.1%). All those numbers explain the hard moment of Italian auto industry and the difficult coming months. However analysts have said that the fall should stop in 2013, and the recovery should come in 2014. Now Italy is Europe’s fourth largest market far behind its eternal rival, France. In that scenario Fiat Group maintained its market share thanks to some specific models. The whole group plus Jeep managed to rise its market share from 28.49% on Nov/11 up to 29.74% last month. This is particularly good news in current situation. Fiat Group sells fewer cars now but is catching share from other auto makers, which are doing worse than the Italians. Nevertheless the ‘good’ fact is explained by only one brand of the group, Fiat, which is down ‘only’ 14%, far from total market’s fall, farther than the other brands of the group, and even much farther than competitors from Germany and France. That is why Fiat brand occupies a bigger place in the group: last year its sales counted for 71% of the group’s total. This year its share in the group is up to 73.5%, which is too much, but is explained by the fact that Lancia and Alfa Romeo (the other 2 ‘big’ brands) don’t have a big range of products. This time Alfa Romeo had a big fall and its Giulietta model did not maintain its sales figures as it happened in previous months. Lancia, down 23.4%, is in complicated situation as it is really dependent on Italian market and the new Ypsilon keeps falling more than total market.

Among mainstream brands Fiat did quite well. Alfa and Lancia continue to fall. Too bad for VW, Renault and Opel. Source: UNRAE, bestsellingcarsblog.net

Among mainstream brands Fiat did quite well. Alfa and Lancia continue to fall. Too bad for VW, Renault and Opel. Source: UNRAE, bestsellingcarsblog.net

After Fiat, then comes Ford as the best-selling brand in Italy. It was down a massive 21%. Then comes VW, which for the first time falls more than total market, down a shocking 27% (it is perhaps its worst result in Europe). A worse situation for Opel, Citroen and Renault. The only big brand to have positive results is Peugeot (now ahead of Lancia). Toyota fell 9%, while Kia is up an incredible 10%. So compared to its main rivals Fiat did very well, but Lancia is in a difficult situation, while Alfa Romeo does not that bad considered the fact that it only offers 2 models. There is concern about Lancia, as it can’t reach not even 5% of the market and Italy represents more than 85% of its sales. So, Lancia faces two difficulties: it does not sell as before in a market that continues to fall. Alfa Romeo is somehow in a better situation, as it is not that dependent on Italy. This year will be by far the worst for both brands in the last 2 decades. Going further, Fiat Group’s share increases due to specific models. Fiat models to have positive result were the new Panda (a tiny growth) and the new 500L which could be the protagonist of the month. The new small MPV was Italy’s 10th best-selling car and could be Fiat’s new star in coming months according to what happened in November. More than 2.000 units were sold that month. That’s a result that can be analyzed from two points of view. 2 thousand units for an all-new model in its third month of life is nothing. But if current situation is taken into account, then the 500L is a complete success. It can be also a kind of savior of Fiat Punto as its gets old while the 500L is a B-MPV that can perfectly fit the needs of those looking for a subcompact. In the opposite side the 500 had a big fall, even worse than Punto. Lancia sold almost 3.100 Ypsilon, down a massive 37%, which is a lot. The Musa, which should be out of production soon, increased its registrations 54%. Finally the Giulietta, which used to be in top 10, now occupies place 14th with almost 1.800 units, down 26%. It was the deepest fall among Alfa Romeo models.

The Panda is the only important model to grow in November. The 500 had a terrible month. The Punto continues to fall and is extremely close to Ford Fiesta's registrations. Too bad for the Ypsilon. The Giulietta falls but not as much as all of its competitors. Source: UNRAE, bestsellingcarsblog.net

The Panda is the only important model to grow in November. The 500 had a terrible month. The Punto continues to fall and is extremely close to Ford Fiesta’s registrations. Too bad for the Ypsilon. The Giulietta falls but not as much as all of its competitors. Source: UNRAE, bestsellingcarsblog.net

The 500L was Fiat Group's 5th best-selling car in Italy. It is the leader of the segment. Good month for the Musa and B-Max. Source: UNRAE

The 500L was Fiat Group’s 5th best-selling car in Italy. It is the leader of the segment. Good month for the Musa and B-Max. Source: UNRAE

Panda stable. Punto declines. 500L grows. The right equation for the crisis. Source: UNRAE

Panda stable. Punto declines. 500L grows. The right equation for the crisis. Source: UNRAE

Click here to see Italy December 2012 results

Click here to see Italy October 2012 results

Fiat Europe October/12: good and bad

The results for Fiat Group plus Jeep in Europe last month are good and bad. Good because Fiat brand decreased its fall and did well in the UK and Spain. But bad because Alfa Romeo and Lancia shrink and German and French registrations continue to fall. European car market fell 4.6% in October 2012 and the whole group did it too but even more: 5.8%. Its market share falls from 6.6 one year ago to 6.5. Total fall could had been worse if Lancia and Alfa Romeo counted for more share inside the group. Their sales in EU + EFTA countries, declined 15% in the case of Lancia and 17.6% for Alfa Romeo. Jeep, which sold only 2.322 units, is up 6%. Once again the group loses market share but this time the fall slows down as Fiat brand managed to increase it. The brand sold 2.7% less than previous period allowing it to increase its share from 4.7% to 4.8%. In October 2012 the group sold 64.736 units (4.016 units less), and Italy counted for 52.6% of them vs. 55.3% of October 2011. It means the group sells fewer cars in Italy (but keeps stable its share over there) and the fall outside Italy is not that deep. The main problems come from the native Italy and France, which is Alfa Romeo’s second market. Compared to its rivals, Fiat Group did much better than Renault, GM and Ford, but is a step behind PSA. VW Group continues to impress increasing its sales volume and therefore its share to a massive 25.5%, almost 4 times Fiat Group’s. Fiat brand occupies place number 8 even after Audi and BMW that now sell more cars. If market conditions continue to aggravate next year Fiat brand could be surpassed by Skoda, which sold 8.557 less cars and is really close to Toyota brand (120 units behind).

It is amazing the way VW manages to rise its market share. Audi and Mercedes stole market share from Renault, Ford and Opel, mainly. Fiat Group did not fall that much as Renault, GM and Ford. Hyundai keeps growing and in October the whole group (Hyundai + Kia) sold 61.810 cars, just 2.926 cars behind the whole Fiat Group. Source: ACEA

The reason for the tiny fall of Fiat brand is explained by the good results in the UK and Spain. Thanks to optimal registrations of the 500 model (in the top 10 best-selling cars in October), the brand is up a massive 39% in a market up 12%. Contrary to those good results, Alfa Romeo does not stop falling, this time 33%, which is too much compared to the good results of Chrysler, up 288%. Alfa Romeo sold 786 units in Oct/11. Last month Alfa Romeo and Chrysler combined sold 686 units. UK has become a kind of substitution market for French bad numbers but the group is still really small in terms of market share (3.4% for Oct/12 vs. 2.9% for Oct/11). Jeep did also good, up 178%, with 339 units delivered. Something similar occurs in Spain: the whole group’s share is up to 3.36% from 2.91% last year. It gained market share due to a lower fall compared to total’s market. Fiat Group plus Jeep fell 9.5% while Spanish car market declined 22%. Fiat brand is up 7.6%, Jeep is up 15%, but Alfa Romeo shrinks a massive 47% and Lancia sells 2 fewer cars. Once again, interesting results but not enough to help the troubled Italian and French figures.

Fiat Group is not really suffering outside Italy. Germany is the largest market in terms of units sold but is the lowest in terms of market share. Good for the UK, Spain and Austria. France is some how stable while the Netherlands and Switzerland did very bad. Source: Autoblog Español, Automotive Austria, ACEA, Rai Netherlands, Auto-Suisse, Carsitaly.net

In France things are going bad but during October 2012 the fall slows down. The market is down 7.8%, much better than previous months results, and Fiat Group declined its registrations by 7.7% thanks to a lower fall of Fiat brand mainly. The brand fell 5.3%, while Lancia increased its registration 1.8% (or 8 more cars), but Alfa Romeo is down 23% (or 259 fewer cars). As it happened in the UK, the 500 model was the protagonist of the month. A record of 2.204 units were sold in October, counting for 54% of the brand’s sales. In Germany, which is Fiat Group’s second most important market after Italy, the group had mix results: Fiat brand is up 8.9% in a market that grew up only 0.5%. But Alfa Romeo declined 20% and Lancia sold only 153 cars, down 0.6%. All brands together (plus Jeep, Ferrari and Maserati) sold 7.244 units against 6.784 in October 2011 (+6.8%). Market share is extremely low at 2.79% against 2.62% for Oct/11. Once again the Fiat 500 is the star with a record sales of 2.310 units. Germany was the largest market for Jeep brand in that month. Too bad in the Netherlands (-38%) where the group sold 1.199 units, down 48%. In Austria (-9%) they all sold 1.497 cars, down 0.4%. In Switzerland all brands sold 1.354 cars compared to 1.637 of last year. In Poland, where Fiat’s share is historically higher than in any other European country, the Group sold 2.169 units (8.5% of the market), down 9%. Generally speaking, Fiat is still strongly dependent on Italian market, which affects its performance as Italy is doing really bad while the good results in other markets is not enough.

This Figure shows the percentage of homeland sales. Almost 53% of Fiat Group’s sales in Europe corresponded to Italy during October 2012. Ford and GM depend on two main markets, while Fiat Group is highly dependent on just one market, which is not good at all. Surprisingly VW Group’s big sales are not exclusively in Germany, which counts for 41% of them. Source: ACEA, Autoblog Español

Europe: “We need to get this issue under control”, Marchionne

Here there are the main highlights of Sergio Marchionne’s interview with Luca Ciferri, Editor-in-Chief of Automotive News Europe:

  • Inevitable the move of merging Fiat and Chrysler by the year 2014
  • Big effort on relaunching Europe operations
  • 2013 total sales target: 4.3 million from which 2.6 million (60%) correspond to Chrysler. It means Chrysler sales will grow 8% while Fiat ones would decline 6%
  • Problem with distribution of production in North America
  • “Success” for the coming Chrysler 200, to be presented in Detroit 2013
  • Regarding Chrysler 100 he thinks “is a great idea to provide dealers in the U.S. with two options in the compact segment”
  • If Chrysler 100 gets produced will come to Europe as the new Lancia Delta
  • Reason for poor results of Lancia Thema/Flavia/Voyager: selling a premium brand in a difficult market is tough. The market is getting smaller
  • The Dodge Dart effectively started rolling out in late September. The target is unchanged
  • He wants different body types for the next generation Chrysler Town & Country and Dodge Grand Caravan. Marketing study is on the way
  • Fiat 500 results in America: great product. Different approach from different people in charge of its sales
  • Jeep can reach 1 million units but it does not have the capacity right now
  • The new SUV from Maserati, the Levante, will be built in Mirafiori, Turin with a lot of the underpinnings coming from the U.S.
  • Jeep’s production in China: the company will remain in USA. It can do CKD units but everything coming from U.S. market.
  • Alfa Romeo to VW: “there are some things that are not available for sale… I have zero interest in selling Alfa”

Source: Automotive News

A possible solution to troubled Italian sales

Photo by: ilgiornale.it

It is my belief that during difficult times such as current European car industry crisis, any idea looking for solving it is welcome, no matter the impact it may have. The situation is that bad that European authorities are finally considering Sergio Marchionne’s idea of assisting the industry and control over capacity problem. But even the most optimistic previsions indicate that next year will be at least as bad as current one. The reasons for this scenario are well-known by everybody but not the possible solutions. Not all car makers are struggling to sell their products. In one side there are French, Italian and American brands trying to resist. In the other side there are VW, BMW and Mercedes, relatively comfortable as they keep earning money in China. That’s why getting to a common solution is difficult, well interests are different and VW, the European leader, is some how benefiting from the mess in which Fiat, PSA, Renault, Ford and Opel are nowadays. In the case of Fiat, the Italian car maker has two big problems: its Italian factories working at 50% of capacity (and therefore the problems with union labors) and the sharp drop of Italian car registrations (along with Spain, Italian fall is the worst of big European markets). Italy represents 54% of Fiat’s sales in Europe. YTD figures show that Italian market has dropped 20% and of course Fiat, as the leader of that market, experiences a big fall too.

Looking for solutions implies understanding the problem. Italians stop buying cars because of economic situation and the bad perspective for coming years. The country is part of a deep recession in most of Europe which is the result of high public expenditure, low revenue and high government inefficiencies. After years of this terrible combination, European governments finally decided to execute a severe austerity plan, firing public employes, and increasing taxes. Italy is part of that austerity plan and Italians are suffering the consequences: less money to save as they have to pay more taxes, and the worst, less job offer. Those looking for a job are coming thru a difficult time, while those having one struggle to keep it in an economy that will shrink 2.4% this year, with unemployment rate around 11%, according to predictions of Confindustria, Italy’s employers’ lobby group. The uncertainty that reigns among Italians is big enough to diminish their spending of everything that is not strictly necessary. Cars is part of that decision and Fiat knows that. If people are not sure of their economic future they cut expenses and they begin with the things that are not vital. Cars are not a basic need so when someone is not sure of keeping his job in coming months, one of the last things this person will think about is buying a car. It explains why Italian market sinks and will continue to do it as far as the economic situation and job offer don’t get better.

The problem is that Fiat can’t wait till things get better. They need to sell cars and increase production levels of its Italian factories and must do it as soon as possible. Understanding the client’s needs and behavior is always a good way to have the appropriate approach in order to sell. And that’s exactly what Fiat should do at least in Italy, its homeland. If the problem for a big part of the population is keeping its job in coming months, then Fiat could use its strategic position as the major private company in Italy to offer some buyers the possibility of buying their new cars with a sort of unemployment insurance. I mean, Fiat as a big player of Italian economy, is able to neutralize the risk of possible future unemployment of potential buyers. They can offer clients to buy their cars (through a credit) and give them the possibility of suspending monthly payments if they ever become unemployed. Of course, it would not apply to everybody, and only in those cases in which Fiat, using its strategic position, makes a close analysis of several companies that could be considered candidates as they might not have problems in the future. That is, Fiat would assume part of the risk the client has of becoming unemployed and so in case that happens (Fiat should only work with those companies with less than 10% of probability of collapse), that client could suspend payments for the time he does not get a new job. The client that could be benefited from this should pay certain quantity of money down and of course a higher interest rate for the credit. For this, Fiat should make a deep analysis of all industries and companies and then make a classification according to their economic situation and future perspectives. Only those buyers working on those companies with low risk exposure could applied for this particular purchase. And in case they become unemployed, they would keep their debt and will be able to use the car. In other words, Fiat would be offering the opposite of normal credits without any money down: instead of not receving the money now, Fiat would get it now but might not receive it in the future, if things get bad for the client. Anyone could say that this could be a good idea of buying a car and then stop paying for it. But when anyone becomes unemployed the very first thing this person looks for is to find a job immediately.

This approach could be a good way of telling clients that Fiat understands their situation and it can support them in case they need help. Fiat would not be risking too much as they would only give this possibility to ‘safe’ companies’ employees and might increase its car registrations, currently affected by this uncertainty about job among potential buyers. The bad side of the equation is that it would not be a good message for the employed people who can’t apply for the credit. Fiat would be telling them their job is not secure and making business with them would not be a good deal. One last thing: this credit should only apply for Fiat Punto, Lancia Ypsilon or Alfa Romeo MiTo. ‘B-Segment’ is Fiat’s major problem nowadays, with the Punto that shrinks 34% so far this year, and the Ypsilon that, no matter its youth, fell 32% in October and 40% in September. And there is the MiTo, which never took off in terms of sales. Most of Fiat’s fall in sales is due to Punto’s drop as the Panda is stable, up 3% YTD. Those thinking more of their job whose income really depend of it, are considered middle-class Italians who normally buy ‘B-Segment’ cars. One person in this situation would not buy a 500, the chic and expensive citycar. They would not buy either the Bravo/Giulietta/Delta models, which are more expensive. If they wanted to change their car they would choose a Punto or Ypsilon, which are affordable and some how comfortable. So the target fits perfectly the products, and in the case of the MiTo, it needs more promotion to get a proper level of sales figures, and this could be a good idea to do it. Or what do you think of this idea?

Last year the Punto counted for one third of Fiat brand sales in Italy while the Ypsilon is almost doubles that number. YTD change for the period January-October 2012 vs. January-October 2011. Source: carsitaly.net and FGW Data basis

Italian car market sinks. Fiat Group down 24%

Photo by 500blog

September 2012 was again a terrible month for Italian car market, down a massive 25,7%, the biggest fall since March 2012. Italians bought 37.000 cars less than one year ago, 44.000 less than two years ago, and 80.000 units less than in September 2009. That’s why specialized press has constantly said that there is a demotorizzazione of the market, which means that Italians are not buying cars as they used to since late 60’s till 5 years ago. Partly because of current European economic situation and partly because those years in which Italian government helped people to buy cars are gone. Fiat is part of the problem and the solution, but this time it seems it will have to do more by itself than with Italian support. In September the whole group sold 24,2% less than one year ago, again a bit better than total market. Fiat gained more market share while some of its main competitors contributed to a deepest fall of the market: Ford (-38%), Opel (-34%), Citroen (-32%) and Renault (-38%). In the other hand, VW was down only 13%, and Peugeot -5%. But the fact that there are other losing more market than Fiat does not mean that the situation of the Italian group is not bad. Certainly a double-digit fall is a worrying issue because it means that there is no such big market they had in mind when they built the factories all over Italy. Of course first victims of this disaster are new models that required a big investment for its development and now they don’t find the clients. Old models can do it better from the point of view of profits as their development costs are already amortized. Obviously less innovation means less sales, so the key is to find the right scenario for investment, innovation and sales.

Sales figures and variation for September 2012/2011. Source: http://www.bestsellingcarsblog.net and UNRAE

Fiat brand was down 23% due to the Punto and surprisingly the Freemont, which was down a massive 53%. It is the first time it happens with this Crossover, as it was having very good results since its launch last year. There are two possible reasons: the first one could be the beginning of decline period of the Freemont as it was not an all-new model when it was introduced. And the second one, more feasible, is the emerge of new Fiat 500L, which had its first complete month in the dealerships. Last month 938 Fiat 500L were sold in Italy, 29 more units than Fiat Freemont. The Freemont sells around 1.500 units per month. Though they are not direct rivals, as the 500L belongs to ‘B-MPV’ segment while the Freemont is a ”D-MPV’ and their prices are quite far away from each others, it all seems that the new 500 MPV got some sales figures of its bigger brother. At the end most of Freemont’s offer is composed by 5 seats with diesel engines, which is pretty much what the 500L offers: 5 seats with lots of efficient diesel engines, and during this difficult times, some families would choose the cheapest option, no matter the big difference there is between them. Lancia’s sales figures dropped 26% because of the big fall of the Ypsilon, down 40%! Why a new car as the Ypsilon is having such bad results? car sales per segment indicate that ‘B-Segment’ is the most affected one with current crisis as the few people who buys a car are not looking for the traditional 5 door compact hatchback but for cheaper ones no matter the car is smaller. The Ypsilon is part of that change. Alfa Romeo sold 24% less, which is not bad at all as it depends on only 2 models, one of them extremely competitive but the other one far away from that denomination. The Giulietta continues to impress no matter the great power the VW Golf has in Italy and the new competitors coming from Germany. There is no doubt that Alfa Romeo guys must be really worried about coming months when the new generation of VW Golf will arrive. Jeep has the worst result, down an impressive 59%. It seems the new Grand Cherokee can not do it by itself and the lack of modern ‘C-SUV’ offer affects considerably Jeep’s total registrations. Ferrari was down 52% and Maserati -55%.

Italy car sales by segment A, B and C. (e) for estimated. Source: http://www.bestsellingcarsblog.net, UNRAE

938 Fiat 500L were sold in September. It allowed it to be the second best-selling small MPV in Italy. Source: http://www.bestsellingcarsblog.net



Click here to see Italy October 2012 results

Click here to see Italy August 2012 results