Fiat SpA (F), the Italian carmaker that controls Chrysler Group LLC, faces a “weak” first quarter in Europe because of declining sales and pressure on prices, Chief Executive Officer Sergio Marchionne said.
It’s “difficult” to predict car sales for 2012 in the region, Marchionne told reporters today in Geneva. “The first quarter is weak,” said the executive, who leads Turin-based Fiat and Chrysler.
Marchionne aims to merge Fiat with Chrysler, based in Auburn Hills, Michigan, to boost revenue to more than 100 billion euros ($131.5 billion) in 2014. He is looking to add a third partner to increase efficiency and cut development costs in Europe, and boost sales in fast-growing countries.
The CEO is counting on Chrysler to propel growth at Fiat, whose volume brands lost about 500 million euros in Europe last year as the region’s debt crisis caused consumers to hold back on purchases. Fiat forecast that 2012 profit will surge as much as 88 percent as the American carmaker’s earnings rise.
Marchionne said today that the lowest range of its profit forecast for 2012 includes a 500 million-euro loss in Europe. He confirmed a plan to break even in the region by 2014 and said Chrysler and Latin America businesses are performing well.
Earnings before interest, taxes and one-time items, which Fiat calls trading profit, will increase this year to 3.8 billion euros to 4.5 billion euros from 2.39 billion euros in 2011, the company said Feb. 1.
Marchionne said there are no talks now with General Motors Corp. for a combination in Europe with the Detroit automaker’s Opel brand. “We had a three-second discussion; we had talks with every carmaker which is losing money in Europe.”
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