Asia success still long shot for ambitious Fiat Chrysler – Reuters… — Volkswagen Fox-Africa

9 Июн 2015 | Author: | Комментарии к записи Asia success still long shot for ambitious Fiat Chrysler – Reuters… — Volkswagen Fox-Africa отключены
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Asia success still shot for ambitious Fiat – Reuters

DETROIT (Reuters) – If Chrysler Automobiles ( FIA.MI ) to become a significant force in it needs to succeed in China. But its record so far in the world’s largest market raises doubts its ability to deliver on growth analysts say.

The newly auto company has been in China for some time, but it has a share of only 0.6 percent in that country and in the Asia-Pacific It lags far behind rivals are truly global players, Toyota Motor Corp ( ), Volkswagen AG ( VOWG_p.DE ), General Co ( GM.N ) and Ford Motor Co ( F.N ).

muscle in China by producing and more Fiats locally is a of a new turnaround plan unveiled by Executive Sergio Marchionne this week as he pushes to global sales by as much as 60 to 7 million cars by 2018.

The strategy was widely criticized by as overly ambitious, causing Chrysler shares to fall on Wednesday.

“Not being in Asia means being half of the global car market,” Andrea Giuricin, a transport at Bicocca University in Milan, “That’s a very big problem for


Fiat Chrysler has been on three car markets: the United Italy and Brazil. Marchionne the world’s seventh-largest auto needs to catch up rapidly in in order to compete in a cutthroat that has been hurt by still-soft demand. In addition, is now flagging in some of the automaker’s key markets including Brazil.

Chrysler sold 130,000 in China last year, with just over 3 vehicles each for Volkswagen and GM.

It wants to sell 850,000 in China by 2018 and raise its share their nearly to 2.8 percent – targets analysts a stretch given the intense and the company’s problems in getting a on Asia so far.

“The driver of growth will be the of our fleet,” Mike Manley, of the Asia Pacific region for Chrysler, said at Tuesday’s presentation. He added building would lower prices and the company’s competitiveness.

CROWDED, MARKET

Producing in China avoiding import duties as as 25 percent. Fiat Chrysler is betting on achieving improved by leveraging Jeep, a more brand than the mass-market

The two automakers first became in 2009 when Italy’s helped Chrysler emerge its U.S. government-led bankruptcy. The combined company was formed in when Fiat acquired ownership of the No. 3 U.S. automaker.

China’s auto sales are jumping nearly 50 percent by to 30 million vehicles, according to IHS which sees the U.S. rising only slightly to 16.4 million vehicles by

In 1983, Jeep became the foreign brand produced in and even though production in 2006, Jeep still a large appeal with an affluent Chinese middle that favors sport vehicles (SUVs).

Together its existing joint-venture partner Automobile Group (GAC) ( ), Fiat Chrysler plans to making Jeeps in China by next year, producing the first, followed by its compact model. The Wrangler and the Grand will remain imported

Analysts said that China is a crowded, fractured with more than 100 Fiat Chrysler could gain a foothold with but volumes may not live up to the company’s

After previous delays in off the ground in China, and without a footing, local production of and Jeeps is unlikely to generate volumes, said Namrita an analyst at IHS Automotive.

“It’s not being pessimistic, it’s being realistic,” she said. is a very complicated market and are many strong existing

LUKEWARM EFFORTS

Doubts Asia added to the skepticism greeted the group’s release of its industrial plan on Tuesday.

The fell almost 12 percent on as analysts questioned whether would manage to multiply raise profit and slash while investing 48 billion ($67 billion) in a global led by the Jeep, Alfa Romeo and brands – and all that without or a capital increase.

The array of Jeeps and Fiats the promised for China will significant investments and “profits and the prospects for substantial cash (and) dividends from the venture may be limited in coming George Galliers, an analyst at ISI said in a note.

Fiat past forays into markets have not been hiccups. Its joint venture GAC is a third attempt in China previous tie-ups with partners failed, and the sales of the Viaggio – the only car it produces and one it designed for China – have not met

Equally difficult has been its into India, thanks to a product portfolio, lack of battered brand image and performance of a retail and marketing with Tata Motors ( ) which finally lapsed in

The group is working on another planning new vehicles, expanding the network and marketing to boost of hatchbacks, India’s largest car and to attract clients who are moving up to and higher-priced vehicles.

But a promise to produce Jeeps in by late 2015 was not met with Fiat Chrysler already the same for 2013, but then delayed its plans as the market

(Additional reporting by Bernie in Detroit and Samuel Shen in editing by Matthew Lewis )

success still long for ambitious Fiat Chrysler –

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