MILAN — Fiat Chrysler Automobiles expects to restore profitability in Europe by the fourth quarter or earlier, CEO Mike Manley says, despite starting the year by reporting a loss.
Manley told analysts on FCA’s earnings call on May 5 that he expects “subsequent quarters will see a return to profitability, with the region recovering to around a 3 percent margin by the fourth quarter.”
FCA’s profit margin in Europe was 1.8 percent in 2018 after reaching a high of 3.23 percent in 2017, when Alfa Romeo production was running at full speed.
For the first quarter, however, FCA posted a loss of 19 million euros ($21.3 million) before interest and taxes in the Europe, Middle East and Africa region, just its second quarterly loss since 2015. In the same quarter last year, FCA posted a 182 million euro ($204 million) profit.
FCA revenue in the EMEA region fell 10 percent because of lower volumes. Vehicle shipments were down 44,000 units or 12 percent to 302,000, with the Alfa and Fiat brands accounting for nearly all the decline, Manley said.
Among the big players in the region, only Ford also announced first-quarter results. The U.S. automaker reported a 50 million euro ($57 million) profit, more than halved from the first quarter of 2018 but still a 0.7 percent margin.