FCA Reports Record Operating Earnings

Third-quarter revenue at Fiat Chrysler Automobiles NV slipped, and unit sales dropped, but operating profit climbed to a record high.

FCA’s global wholesales fell 9% to 1.06 million units, as U.S. dealers trimmed bloated inventories. A richer global sales mix offset the erosion, holding the decline in third-quarter revenue of €27.3 billion ($30.5 billion) to 1%.

Net profit swung for the period swung to a €179 million ($200 million) loss from a €514 million profit in the third quarter last year. FCA says results were weighed down by the cost of settling claims about excess diesel emissions and an impairment charge in Europe related to trimming its small-car lineup.

FCA’s strongest market was North America. It delivered 70% of the company’s third-quarter revenue in spite of an 11% drop in unit wholesales. Adjusted pretax earnings for the region advanced 4% to $2.3 billion.

In Europe, revenue for the quarter shrank 6% to €4.7 billion ($5.2 billion). Consolidated factory shipments fell 5% to 260,000 vehicles. Adjusted pretax losses deepened to €55 million ($61 million) from €30 million in 2018.

In Latin America, shipments were flat at 150,000 units. But the company’s revenue climbed 10% to €2.2 billion ($3.4 billion). Adjusted pretax earnings zoomed 83% to €152 million.

In Asia Pacific, FCA’s revenue jumped 18% to €687 million ($767 million). The company credits favorable exchange rates and a more profitable sales mix. Adjusted operating losses narrowed to €10 million from €96 million in 2018.