Fiat Chrysler Automobiles, in signalling a 47 per cent drop in profits for the first quarter of 2019, says that despite the large drop the company is confident that that its changes in production and the new models that will be produced will soon put the firm back on track. By the end of 2019, Fiat is expecting to meet its full-year profit targets.
In terms of Fiat’s latest financial performance, net profits tumbled to 508 million euros ($763 million), according to CBC News. This was down from 951 million euros for the same quarter in 2018. The company also notes that its net revenue dropped five per cent to 24.5 billion euros ($36.8 billion).
The Financial Times reports that global vehicle sales fell 14 per cent to one million vehicles, with a slowdown in every one of the company’s regions. Fiat’s brands include Jeep, Ram, Dodge, Alfa Romeo and Maserati.
The changes to manufacturing that Fiat have been undertaking are designed to meet new vehicle emissions rules (an average emissions limit of 95g per kilometer in the U.S). To meet the requirements, Fiat are to purchase credits from Tesla in order to help it hit carbon dioxide goals and avoid large fines in both the U.S. and Europe. The cost of doing this is around 1.8 billion euros. In other words, as Digital Journal’s Ken Hanly reports, Fiat will pay Tesla for the right to count Tesla electric vehicles as part of its fleet of cars.
With the new models, Fiat is setting out to produce its own cleaner vehicles, as well as hybrid and pure electric models. The Tesla credits off-set is designed to give more time for these car models to be developed and get to market, with the additional hope that consumer buying of electric vehicles picks up.
