FIAT CHRYLSER SHARES TUMBLE ON WEAK OUTLOOK
1:32 am, February 09, 2019
BloombergNEW YORK (Bloomberg) — Already standing in the long shadow of his predecessor, Fiat Chrysler Automobiles NV Chief Executive Officer Mike Manley faces a series of challenges to keep the automaker on track after less than a year at the helm.
After disappointing investors on Thursday with a lower-than-expected outlook, Manley is under pressure to keep a commitment to reinstate dividend payments for the first time in a decade even as he struggles to engineer a turnaround in Europe and Asia.
Fiat Chrysler shares plunged as investors registered disappointment with its latest results. The company pointed to stronger earnings growth in North America, which is its largest and most profitable market, but analysts fixated on higher-than-expected costs in the region in the fourth quarter.
The Italian-American automaker’s full year forecast for €6.7 billion ($7.6 billion) in adjusted earnings before interest and taxes fell well below targets that ranged as much as 28 percent higher. The stock drop was the worst since July 25, shortly after Manley took over from an ailing Sergio Marchionne.
Manley, 54, is battling issues left over from the Marchionne reign, as well as new ones that have emerged on his watch. The Chinese market weakened substantially in the second half of the year, and the automaker had difficulty ramping up production of a new Ram truck.
Lessons learned
“We’ve learned some lessons in 2018 and encountered some new challenges,” Manley said on a call with analysts. “We are starting the year with new leadership team members with the experience and the mandate to improve our operations.”
Fiat shares were down 12 percent at 3:00 p.m. in New York. They’ve declined 20 percent since Manley made his debut with investors in July.
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