New Fiat Chrysler five-year business plan to focus on execution

Article by Christian A., on May 6, 2014

The new business plan of chief executive Sergio Marchionne for the Fiat Chrysler group will rely on Jeep, Alfa Romeo and Maserati becoming global brands. Marchionne is set to unveil Fiat Chrysler’s five-year business plan on May 6, which should show the newly merged company can "go on the attack against the giants" in the auto industry.

This time, the US-Italian carmaker will focus on execution, after repeatedly missing sales targets due to delayed investments and making some bad styling decision. Investors are aching to see how Marchionne would be able to hike sales by over a third to more than 6 million vehicles by 2018 as well as how and when the CEO would compete against larger carmakers like Toyota Motor Corp, General Motors Co and Volkswagen.

Stephanie Brinley, a senior analyst at researchers IHS Automotive, told Reuters that Fiat Chrysler has to stop saying it will do it, adding that what is lacking is the execution of the plans. Jeep is currently the best weapon that Fiat Chrysler has, having ready products and being a global SUV brand.

To achieve sales targets and boost margins, Marchionne will have to start building Jeep SUVs not only in Europe but also in fast-growing markets like Brazil and China. In fact, Fiat Chrysler will commence building the Jeep Renegade compact SUV in Italy later this year and in Brazil in the next.

The Renegade - the brand's first model to be built exclusively outside the US – is considered as vital for achieving an overall sales goal of 1 million vehicles this year, representing a 37-percent surge over 2013. Even analysts who described the sales target ambitious agree that Jeep is the only truly global brand that Fiat Chrysler has and represents its best opportunity to expand in Asia.

Fiat Chrysler's joint venture in China also has plans to build three Jeep models locally, with the first one arriving in late next year. On the other hand, Marchionne intends to overhaul the luxury Maserati and upmarket Alfa Romeo marques by building them into global brands and boosting their positions in the high-margin market for premium cars. The CEO is expected to pledge at least six new Alfa models under the plan.

The models would include premium-priced sedans and SUVs, the first of which will arrive in early 2016. Marchionne believes Alfa could deliver the global profile that volume brand Fiat couldn’t.

He also believes that Alfa could deliver more sales than Maserati. Analysts, however, Marchionne will need considerable time and billions of euros to outcast Alfa’s weak quality reputation.

Fiat had repeatedly tried to revive Alfa, and those efforts left behind just three models as sales continue to drop by over half over the past decade to 74,000 units in 2013.

The future of Alfa will be crucial to Fiat’s survival in the harsh European market. A success would allow Fiat Chrysler to fully utilize plant capacity in Italy and reinstate thousands of workers currently under temporary layoff schemes. Maserati, meanwhile, saw its trading profit tripled and deliveries doubled in 2013. [source: Fiat]

If you liked the article, share on:

Comments

Recommended

Bimmerpost has posted several cool pictures of the new BMW G30 540i and the new G31 generation BMW 5-Series Touring, with both wearing the brilliant Rhodonite Silver Individual colour. The...
by - October 23, 2017
A few years ago, Lotus tried to take on Porsche. They had a five-car plan to go against competitors like Ferrari and Aston Martin. Though it did not go well,...
by - October 23, 2017
To keep the Nissan Maxima interesting, the Japanese automaker gives the 2018 model year a number of small tweaks. Some of these include standard Android Auto, which is a new...
by - October 23, 2017
It looks as if Chevrolet has everything planned out in terms of production. Firstly, they have plans of introducing the Corvette ZR1 in a few months, which will then be...
by - October 23, 2017
While Tesla Motors continues to struggle with regards to the assembly of its much awaited Tesla Model 3, investment firm Oppenheimer & Co. is confident that its previous production estimates...
by - October 22, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries