Fiat SpA said it would trim down its 2013 profit and sales forecasts as a third-quarter drop in Latin America managed to offset the strong performance at its US Chrysler unit.
Analysts were expecting a poor situation in Brazil, which usually amounts to about 25% of Fiat’s trading profit, because of the strong euro and the end of car sales incentives, but were caught off guard by the big cut in guidance.
Fiat dropped its prediction for net income for 2013 to a range of 900 million to 1.2 billion euros from an earlier 1.2 billion to 1.5 billion euros. As a result, shares slid 13 cents or 2.2% Wednesday on the Milan Stock Exchange to 5.70 euros per share.
Latin America and Chrysler are growing in importance to Fiat as its business in Europe falters after a six-year slump in auto sales in the region. In Europe, Marchionne is trying to fill Fiat’s plants with new Maserati and Alfa Romeo models that the company plans to export.
“The minute that you shut down (a factory), you benefit everybody else,” Marchionne said. “We will not be shutting down plants to facilitate the dominance of the European car market by Germany.”
Fiat is mulling an investor meeting in the first quarter of 2014 where Marchionne and other officials will present the company’s new 5-year plan for all brands.