Mexican Media Brands
Chrysler’s Cash Could Lower FCA Financing Costs by €1 Billion
Fiat Chrysler Automobiles NV should be able to lower its borrowing costs by about €1 billion ($1.1 billion) in 2018 by tapping into Chrysler’s $13 billion (€11.9 billion) cash reserves.
#economics
Share
Fiat Chrysler Automobiles NV should be able to lower its borrowing costs by about €1 billion ($1.1 billion) in 2018 by tapping into Chrysler’s $13 billion (€11.9 billion) cash reserves.
Analysts tell Bloomberg News the option is available now that FCA has retired bonds that restricted the transfer of funds beyond Chrysler’s own operations. One expert estimates the new access will save the company about €350 million this year. Another figures Chrysler’s cash will hike FCA’s net income by €630 million in 2018.
CEO Sergio Marchionne is expected to use some of Chrysler cash to help bankroll FCA’s €48 billion expansion plan, thereby reducing the need for outside finance. But most analysts remain skeptical that the company will be able to achieve its goal of tripling net income to €5 billion in 2018.
Yesterday FCA affirmed that target and other financial goals, including an operating margin between 6.4% and 7.2%. The company also raised its 2018 revenue forecast 3% to €136 billion, citing a richer mix of highly profitable trucks and SUVs.
RELATED CONTENT
-
China and U.S. OEMs
When Ford announced its 3rd quarter earning on October 24, the official announcement said, in part, “Company revenue was up 3 percent year over year, with net income and company adjusted EBIT both down year over year, primarily driven by continued challenges in China.” The previous day, perhaps as a preemptive move to answer the question “If things are going poorly in China, what are you doing about it?, Ford announced that it was establishing Ford China as a stand-alone business unit.
-
On Headlights, Tesla's Autopilot, VW's Electric Activities and More
Seeing better when driving at night, understanding the limits of “Autopilot,” Volkswagen’s electric activities, and more.
-
Mazda, CARB and PSA North America: Car Talk
The Center for Automotive Research (CAR) Management Briefing Seminars, an annual event, was held last week in Traverse City, Michigan.