Wed. Feb 26th, 2020

FCA expects a 1.5% sales increase in Latin America this year



Sales of Fiat Chrysler Automobiles (FCA) will increase 1.5% this year in Latin America, led by Brazil, which should present an increase of 6%, as predicted on Wednesday by the president of the company for the region, Antonio Filosa.

The group, which owns brands such as Jeep, RAM, Dodge or Alfa Romeo, currently holds 13.9% of the market share in Latin America, the company’s second most important subdivision, which includes all the countries of South and Central America .

FCA is the second largest assembler in Latin America, after General Motors, and the markets that stand out most in its operations in the region are Brazil, Argentina and Chile, in that order.

In 2019, FCA had an increase in market share in Brazil of 1.1 percentage points under the Fiat and Jeep brands, a trend that is contrary to the regional one that should be maintained in 2020, and reached 18.7%.

“The growth was possible, basically, because Latin America’s total market showed a decline, but Brazil grew within this equation by almost 8%, while Argentina had a retraction of 44%,” Filosa said during a press conference in Sao Paul.

“We gain in sales volumes, market shares and as a region we increase our contribution and generate about 500 million turnover, 8% of the total FCA,” he added.

BRAZIL AS A REGIONAL GROWTH ENGINE

In that sense, he predicted a “minimum growth” for the regional market in number of sales, which he attributed to Brazil, and highlighted the trend of falling unemployment and interest rates in the country -which have reached historical lows-, as well as the increase of facilities to access credits, as engines of this increase in the South American giant.

“Sales to families, which account for 55% of the total, must increase, but at a lower rate than direct sales to companies, whether small, medium or large,” he said.

He also stressed the arrival of new vehicle models, such as the latest version of the Fiat Strada and the electric Fiat 500, the first model of the company with these characteristics that will be marketed in Brazil from the second half.

“Brazil is going to grow 6%, with 2.8 million units sold, and Argentina is going to drop something around 10% or 15%, with 400,000 units,” he said.

He also pointed out that FCA is the most investing company in the country, with an amount of around 15,000 million dollars for the 2018-2024 period and recalled the plans for exports of engines and transmissions made in Brazil to Europe, which should jump from 23,000 in 2019 to 230,000 in 2020, produced in its main factory in the city of Betim (southeast).

THE ARGENTINE MARKET

Regarding the second largest market in the region, where FCA was installed 101 years ago, Filosa pointed out the impacts of the economic crisis on the activities of the automotive sector, but was optimistic about the future.

“The Argentine economy is unpredictable in the long term, for better and for worse and has good pillars, with an agricultural sector almost as strong as the Brazilian, important reserves of oil, gas and minerals. In addition, it has about 44 million inhabitants with power purchasing power superior to that of Brazilians. I think it is full of good indicators for lasting growth, “he explained.

In that sense, he also predicted a turning point in FCA sales in the country from the second half.

THE FUSION WITH PSA

On the merger agreement with the French group PSA, owner of brands such as Peugeot or Citroen, announced at the end of 2019, Filosa recalled that the transition period will last 12 months and that only at the end of this process will the details be revealed of the reorganization to which both parties are going to submit.

He indicated that there are many possibilities for good synergies in many regions of the world, especially in Latin America, where FCA is one of the main market leaders, and pointed out the possibility that both can “build together a future” in Asia-Pacific.

“We will never be Fiat again, we are FCA and we will be something else soon,” he added.

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