A strong financial performance in North America helped Fiat Chrysler Automobiles report a 17 percent jump in third-quarter adjusted operating profit on Tuesday even as sales and market share fell in the United States and Canada.
Adjusted earnings before interest and tax (EBIT) rose to 1.76 billion euros ($2.1 billion), aided also by improvements in Europe and Latin America. Revenue fell 2 percent to $31.1 billion.
Net profit climbed to $1.1 billion from $712 million a year earlier.
The carmaker reported an 8 percent adjusted operating profit margin in North America, up from 7.6 percent a year earlier. FCA attributed the increase mainly to a heavier sales mix of more profitable pickups and SUVs, as well as pricing gains.
North American revenue slipped 4 percent to $18.98 billion, while shipments in the region slipped 6 percent to 592,000 vehicles, largely on a drop in fleet sales from 21 percent to 15 percent in the quarter.
FCA said its U.S. market share slipped to 11.3 percent at the end of the quarter, from 12.5 percent a year earlier. It Canadian share fell to 11.1 percent from 12.5 percent.
FCA’s 8 percent margin compares with the 8.3 percent reached by bigger U.S. rival General Motors.
The company's shares finished the day up 5.4 percent, ending at $17.45 on the New York Stock Exchange.
The automaker confirmed its timeline for retooling its North American production capacity to produce more pickups and SUVs, confirming officially for the first time that it will retool its Warren Truck Assembly plant in suburban Detroit to build the upcoming Jeep Wagoneer and Grand Wagoneer body-on-frame SUVs next year.
The automaker also confirmed that its retooled Sterling Heights Assembly plant, which will begin making the redesigned Ram 1500 in January, will be able to produce about 60,000 more half-ton pickups per year than the pickup’s current line in Warren Truck.
FCA said its closely watched net industrial debt rose to $5.2 billion by the end of September from $4.9 billion three months earlier because of currency effects, but confirmed that its net industrial debt would fall to less than $2.9 billion by the end of 2017. In the quarter, FCA said its total debt fell to $21.9 billion from $22.5 billion at the end of June.
Profitability also improved in Europe, helped by sales of the Stelvio and the new Jeep Compass. The company also was profitable in Latin America, while margins at Maserati remained strong at 13.8 percent on demand for its first crossover, the Levante.
On a call with analysts, CEO Sergio Marchionne said:
Reuters contributed to this report.
Send us a letter
Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.