Fiat Chrysler’s quarterly profit dips
Results dented by emissions tests allegations
Fiat Chrysler Automobiles NV said Tuesday that third-quarter net profit slumped, hit by a diesel-emissions charge.
Net profit fell 38% to564 million euros ($642.3 million (U.S.)) in the period, from 910 million euros the same period last year, hurt by a 700 million euro charge for “estimated costs related to U.S. dieselemissions matters,” the ItalianAmerican carmaker said.
The Justice Department sued the company in 2017 alleging it used illegal software to cheat on government emissions tests. Fiat Chrysler said Tuesday the charge didn’t represent an agreed settlement, or an admission of liability, but rather an estimate based on the “progress of settlement discussions.” Revenue increased 9% to 28.77 billion euros, Fiat said.
Adjusted earnings before interest and taxes rose 13% to 2.0 billion euros. Net industrial debt was 189 billion euros as of Sept. 30, partly due to higher pension contributions, the company said.
The results mark the first fullquarter results under Chief Executive Mike Manley, who took the top job a few days before the death of longtime CEO Sergio Marchionne. Mr. Marchionne died July 25 following complications from surgery.
The quarter showed the extent to which the Detroit automakers continue to lean on the U.S. market amid toughening conditions in key overseas markets. Fiat Chrysler’s operating profit in North America accounted for nearly all of its operating bottom line in the quarter, as the company swung to losses in Europe and Asia-Pacific amid weak China sales.
Ford Motor Co. last week also reported stronger-than-expected results in North America, helping to offset weakness in international markets. General Motors Co. reports third-quarter results Wednesday. main an independent company, despite rumours for years that the company could strike a large deal, speculation stoked by Mr. Marchionne’s own mantra that the global auto industry needs to consolidate. Instead, Mr. Manley will carry on his predecessor’s drive toward lifting profitability and shareholder returns.
The company cut its 2018 guidance for net industrial cash, now forecasting net industrial cash of between 1.5 billion euros and 2.0 billion euros. It had previously expected net cash of about 3.0 billion euros.
The company confirmed its full-year guidance for operating metrics, saying it continues to see adjusted after-tax profit for the year of about 5.0 billion euros and net revenue of between 115 billion euros and 118 billion euros.