Fiat set to keep on trucking

Fiat is built to survive the financial crisis, according to its CEO Sergio Marchionne - and it will be trucks that are driving the company's stability.

He says the company has enough liquidity to get through the current Euro financial winter, and confirmed its investment plans.

"What happens industrially and what happens on the stock market are separate issues. They are totally dissociated," he said during a presentation at the Iveco unit of Fiat Industrial this week.

"We learned the hard way in 2008. We have cleaned up. We have enough liquidity in the system, here and on the car side, to weather the storm. Life will go on."

Last week, Marchionne admitted a review of volumes and new product timing because of the euro-zone crisis, and said that this year and next would be hard graft for the car market in Europe unless consumer confidence in the region's financial systems were restored.

He said that the truck segment will recover faster than the car segment.

As car companies cut production volumes, Marchionne raised the sales targets of Fiat Industrial on the strength of better-than-expected second-quarter forecasts which were likely to be replicated in Q3.

Fiat Industrial split from the parent company at the beginning of this year, targeting a €1.5 billion trading profit and estimating €24 billion in revenue.

Marchionne hit back at claims that Fiat would be delaying investments.

"To the best of my knowledge, I don't think we are delaying anything," he said.

Stateside, Chrysler, in which the Fiat group has a 53.5 per cent stake, is in spirited negotiations with the powerful United Auto Workers union.

Marchionne said he was confident of reaching a labour deal with UAW, but it would not be a carbon copy of the General Motors agreement reached last week after seven weeks of talks.

The four-year contract between GM and the union set up the basis of a four-year contract (yet to be ratified by workers) that would create new jobs and include profit-share options.

It would be the first contract with the UAW since 2009 when GM and Chrysler came out of US government-backed bankruptcy restructures.

- NZ Herald

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