--
 
Top new models for SA

From Renault's new Alaskan bakkie to the latest models at the Frankfurt motor show bound for SA.

Electric cars in SA

The debate on whether or not Electric Vehicles (EV) are viable in South Africa rages on.

Fiat-Chrysler to spin-off Ferrari

2014-10-30 07:24

END OF AN ERA: Fiat-Chrysler CEO Sergio Marchionne (right) poses with former Ferrari President Luca Di Montezemolo following a press conference in Maranello, Italy. Marchionne will head up Ferrari. Image: AP/Antonio Calanni

MILAN, Italy — Fiat Chrysler Automobiles plans to spin off Ferrari into a separate company, a way to unlock value in the luxury brand and distinguish it from its mass-market parent.

The company said on Wednesday (Oct 29 2014) that spinning-off Ferrari was part of a plan to raise capital to support the new merged automakers' expansion plans. Fiat Chrysler's five-year plan calls for increasing net income fivefold by 2018.

Fiat Chrysler CEO Sergio Marchionne said in a statement that it was "proper that we pursue separate paths for FCA and Ferrari" following the completion of the merger of Chrysler and Fiat with a listing on the New York Stock Exchange earlier in October 2014.

AWKWARD TRANSITION

Fiat Chrysler will sell 10% of Ferrari's shares in a public offering, with the remaining 90% distributed to its own shareholders. The board intends to complete the move during 2015 and said shares would be listed in the United States and with a possible double listing in Europe.

A Ferrari split had long been speculated on by industry experts as Marchionne sought to maximize values from the group's various brands. However, Fiat Chrysler's other luxury brands, including Alfa Romeo and Maserati, will remain part of the parent company.

The decision to break off Ferrari comes about two months after an awkward management transition at Ferrari that saw the longtime chairman Luca di Montezemolo resign after a public spat over strategy with Marchionne, who has taken over as chairman of Ferrari.

Marchionne has been vocal in his displeasure over Ferrari's long absence from Formula 1's winner's circle and has pledged to get the team back to the top. The last time it won the Driver's championship was in 2007.

FIAT GROUP PROFITS SOAR

Also on Oct 29, Fiat Chrysler Automobiles announced ar eturn to a profit in the third quarter thanks to a good performance by its luxury brands and gains in North America and Asia. It reported a net profitequivalent to R2-billion for the three months ending September 30 against a loss of R200-million in the same period in 2013.

Revenues rose 14% to 23.5-billion euros. Luxury brand sales increased 35%, North America saw a 20% gain and Asia was up 30% . Latin American revenues dropped 12 percent in a weak market. Deliveries rose 9.7% to 1.1 million vehicles.

NEXT ON WHEELS24X
Read more on:    fiat  |  ferrari  |  chrysler  |  italy  |  new models  |  auto industry

Inside Wheels24

There are new stories on the homepage. Click here to see them.