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Tuesday, 05 May 2020 22:27

FCA Wants to Restart Plants Week of May 18, After Losing $1.84B in Q1

Written by Breana Noble, The Detroit News

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Twenty-two FCA employees have died from the COVID-19 outbreak, Manley said. At least 16 of those were United Auto Workers members, according to the union. The rollout of additional safety measures in China, however, has been successful there, Manley said.

 

The measures include distancing workstations, staggering start times, using thermal-imaging cameras to check for fevers, adjusting traffic flow inside the plant, placing hand sanitizing dispensers at every entrance and providing face masks.

 

UAW President Rory Gamble in a statement said when it comes to start dates, the automakers "contractually make that decision and we all know this day would come."

 

"We continue to advocate for as much testing as possible at the current time and eventually full-testing when available," he said. "Our UAW focus and role is and will continue to be, on health and safety protocols to protect our members."

 

But with no cars, trucks or SUVs rolling off North American assembly lines into late May---halfway into the second quarter---Fiat Chrysler has withdrawn its $7.8 billion pre-tax earnings 2020 guidance it set in October. The company said it will provide an update when it has "better visibility of the overall impact of the crisis," though it expects the virus's impact to be even worse on the second quarter.

 

Other targets also are moving. Key product launches are being delayed by three months, though no programs have been canceled to date. Major construction projects, including at its new assembly plant on Detroit's east side formerly occupied by the Mack Avenue Engine Complex and at the Warren Truck Assembly Plant, paused because of the virus. It also has halted nonessential projects that were in development to conserve on cash, putting nearly 2,000 supplemental contract workers out of a job across North America.

 

The automaker, however, said it remains committed to merging with French automaker Groupe PSA of Peugeot and Citroën by the end of the year or in early 2021.

 

"At this time, all the terms and conditions we agreed to as part of the merger process have not changed," Manley added.

 

Fiat Chrysler's shares in May 5 trading were falling by 0.4%, as market indexes were climbing. Its stock remains down about 44% year-over-year.

 

In the first quarter, adjusted diluted loss per share was $1.17. FCA's 3.8% pre-tax margin in North America fell from 6.5% a year earlier. U.S. sales fell 10% year-over-year.

 

Results in January and February were in line with the company's expectations, Manley said. During the first quarter, Fiat Chrysler performed better than the industry overall, increasing its U.S. market share to 13%, according to Cox Automotive Inc.


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