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Presentation3
Bank am Bellevue
Investor Meeting January 17, 2015
January 17, 2015 2 Bank am Bellevue
This document contains forward-looking statements.
These statements may include terms such as “may”,
“will” , “expect”, “could”, “should”, “intend”,
“estimate”, “anticipate”, “believe”, “remain”, “on
track”, “design”, “target”, “objective”, “goal”,
“forecast”, “projection”, “outlook”, “prospects”,
“plan”, “intend”, or similar terms. Forward-looking
statements are not guarantees of future
performance. Rather , they are based on the Group’s
current expectations and projections about future
events and, by their nature, are subject to inherent
risks and uncertainties . They relate to events and
depend on circumstances that may or may not occur
or exist in the future and, as such, undue reliance
should not be placed on them. Actual results may
dif fer materially from those expressed in such
statements as a result of a variety of factors ,
including: the Group’s abil i ty to reach certain
minimum vehicle sales volumes; developments in
global f inancial markets and general economic and
other conditions; changes in demand for automotive
products, which is highly cyclical ; the Group’s abil i ty
to enrich the product portfolio and offer innovative
products; the high level of competit ion in the
automotive industry ; the Group’s abi l ity to expand
certain of the Group’s brands internationally ;
changes in the Group’s credit rat ings; the Group’s
abil i ty to realize anticipated benefits from any
acquisitions, joint venture arrangements and other
strategic all iances; the Group’s abil i ty to integrate its
operations; potential shortfalls in the Group’s
defined benefit pension plans; the Group’s abil i ty to
provide or arrange for adequate access to f inancing
for the Group’s dealers and retai l customers; the
Group’s abil i ty to access funding to execute the
Group’s business plan and improve the Group’s
business, f inancial condition and results of
operations; various types of claims, lawsuits and
other contingent obligations against the Group;
material operating expenditures in relation to
compliance with environmental, health and safety
regulation; developments in labor and industrial
relations and developments in applicable labor laws;
increases in costs, disruptions of supply or shortages
of raw materials ; exchange rate f luctuations, interest
rate changes, credit risk and other market risks ;
political and civil unrest; earthquakes or other
natural disasters and other risks and uncertainties .
Any forward-looking statements contained in this
document speak only as of the date of this document
and the Company does not undertake any obligation
to update or revise publicly forward-looking
statements. Further information concerning the
Group and its businesses, including factors that
could materially affect the Company’s f inancial
results, is included in the Company’s reports and
fi l ings with the U.S. Securities and Exchange
Commission, the AFM and CONSOB.
Safe Harbor Statement
January 17, 2015 3 Bank am Bellevue
FCA financial snapshot
1 Includes acquisition of Chrysler equity in January 2014 (€2.7B) and adjustment for retrospective application of IFRS 11 (€0.4B)
NAFTA
53%
LATAM
11%
EMEA
19%
APAC 5%
Components
6%
Luxury 4%
Other 1%
FY 2013 Net Revenues
€86.6B
NAFTA
76%
LATAM
16%
APAC
11%
Components
5%
Luxury
16%
FY 2013 EBIT €3.0B
Memo:
EMEA (17)%
Other (7)%
Note: Numbers may not add due to rounding
FY
2013
Q3 YTD
2014
Shipments 4.4M 3.4M
Net Revenues €86.6B
€69.0B
EBIT €3.0B €2.2B
Net industrial debt €9.7B1 €11.4B
Total liquidity €22.7B €21.7B
January 17, 2015 4 Bank am Bellevue
2014 was a momentous year
Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Chrysler Acquisition
(January 1)
Fiat S.p.A. reaches
agreement with VEBA to acquire remaining stake
in Chrysler Group
Shareholder Approval of
Merger
(August 1)
Merger plan approved during
Fiat S.p.A shareholders’
meeting
Merger Effective and Dual-Listing
(October 12-13)
• Merger of Fiat S.p.A with and into Fiat Investment N.V. becomes effective October 12
• Surviving entity renamed Fiat Chrysler Automobiles N.V. (FCA)
• October 13, FCA listed for trading on New York Stock exchange (NYSE)
Corporate Reorganization
Approval
(January 29)
Fiat’s BoD approves corporate reorganization of “FCA” as a Dutch-
incorporated, British-domiciled LLC with principal executive offices in
the UK
5-Year Business Plan
(May 6)
Combined company presents detailed
business plan including
product plans and financial targets for
2014 - 2018
U.S. Capital Markets
Transactions
(December 16)
• Raised $4 billion
• 100 million shares of common stock issued on NYSE
• $2.875 billion of mandatory convertible securities issued
Announced Planned
Transactions
(October 29)
• Issue common shares
• Issue mandatory convertible security
• Separate Ferrari through an IPO and subsequent spin-off
January 17, 2015 5 Bank am Bellevue
FCA 2014 – 2018 business plan
Continued volume growth
Leverage Jeep's global appeal with increased segment coverage and geographic expansion
Portfolio expansion into white space opportunities – including rebirth of Alfa Romeo
Clear focus on APAC through Jeep, Alfa Romeo and Chrysler brands
Targeted sales of ~7M units (including JVs) in 2018, up from 4.4M units in 2013
Margin expansion
Continue to grow Maserati and launch Alfa Romeo brand worldwide
Localize Jeep production in all regions
Repurpose Italian manufacturing footprint to luxury and premium vehicles
Architecture reduction & parts commonization
January 17, 2015 6 Bank am Bellevue
Broad-based brand portfolio
Mass-market
Premium
SUVs
Premium
Luxury
High performance luxury cars
Luxury sports vehicles
Sedans &
minivans
Trucks
& LCVs
Performance
500 family
& economy
LCVs
January 17, 2015 7 Bank am Bellevue
Industry outlook is positive
Units (M)
Source: IHS (2014-2018)
13.1
14.8
15.9
16.7 17.0
17.3 17.6 17.4
15.6
17.5
18.7
19.7 20.0 20.4 20.6 20.5
2011 2012 2013 2014E 2015E 2016E 2017E 2018E
U.S.
NAFTA
NAFTA & U.S. (passenger cars, SUV,
pickup trucks, LCVs
and heavy trucks)
LATAM & Brazil (passenger cars & LCVs)
APAC & China
(passenger cars & LCVs)
17.6 18.6
20.6
23.3 24.9
26.7 28.1 28.8
30.4
33.5 35.3
38.2 40.3
42.5 44.5
45.8
2011 2012 2013 2014E 2015E 2016E 2017E 2018E
China
APAC 3.4 3.6 3.6
3.2 3.3 3.3 3.5 3.6
5.6 5.9 5.9
5.2 5.1 5.3
5.5 5.7
2011 2012 2013 2014E 2015E 2016E 2017E 2018E
Brazil
LATAM
EMEA & EU28+EFTA (passenger cars & LCVs)
15.3 14.0 13.8 14.5 14.9 15.3 15.6 16.0
22.0 21.3 21.1 21.3 21.7 22.4 23.4
24.4
2011 2012 2013 2014E 2015E 2016E 2017E 2018E
EU28+EFTA
EMEA
CAGR 2013-18: 1.9%
CAGR 2013-18: 1.8%
CAGR 2013-18 : 0%
CAGR 2013-18: (0.7)% CAGR 2013-18: 5.3%
CAGR 2013-18: 6.9%
CAGR 2013-18: 2.9%
CAGR 2013-18: 3.0%
January 17, 2015 8 Bank am Bellevue
Global growth drivers by region
2013 volume: 0.9M; 2018 target: 1.3M
Market leader with extensive local production and distribution (21.7% share in Brazil for 2014 Sept YTD)
Significant cost advantages with flexible production sites (Pernambuco upside)
Localize Jeep production
Expand product offering to larger vehicles while maintaining leadership in small vehicle segments
2013 volume: 2.1M; 2018 target: 3.1M
Fastest growing OEM since 2009, 3.5 ppt share growth in the U.S. since 2009 1
Chrysler and Dodge overlap eliminated
Launch Alfa Romeo following Maserati’s strong start
Well-positioned to take advantage of strong growth in SUVs and pickups
New entries in high volume passenger car segments
Renewal of segment leading minivan in 2016
2013 volume: 0.2M; 2018 target: 1.1M
Expansion of selected global brands with strong brand equity and pricing power (Jeep, Alfa Romeo)
Localize Jeep manufacturing in growing UV market enabled through JV
Localize production of Chrysler brand in China
Expand distribution network
2013 volume: 1.1M; 2018 target: 1.5M
New Jeep models and Alfa Romeo launch
Expansion into UVs largest-growth small SUV segment, 13% CAGR
Continuing 500 family focus for Fiat brand. . . not chasing share in commodity segments
Industrial base repurpose to support global luxury and premium vehicle strategy
NAFTA
LATAM
EMEA
APAC
1 Calculated as 2014 September YTD share vs. FY 2009 Plan is to grow from
4.4M units in 2013 to ~7M units in 2018
January 17, 2015 9 Bank am Bellevue
Growth strategy
• 2013: 732,000
• 2014: 1, 017,000
• 8 new models and refreshes
2014 - 2018
Sales volume
Expanding product and geographic reach
• Entry into largest global SUV segments
with new products in new regions
• Localizing production in APAC (China),
LATAM (Brazil) and EMEA (Italy)
• From 5 nameplates in 1 country to 6
nameplates in 6 countries
Grand Cherokee
Patriot
Compass
Cherokee
Wrangler
Renegade
C-SUV
(2016)
Grand Wagoneer
(2018)
January 17, 2015 10 Bank am Bellevue
Alfa Romeo’s return to its true DNA
Mito Giulietta 4C
• Return to legacy of the brand with all new RWD / AWD
architecture and powertrains
• Expand reach into global high margin premium vehicle
segments
• Add distribution in NAFTA and APAC
• All vehicles and engines industrialized in Italy
• Dedicated “Skunk Works” to develop new products
• Production from existing Italian manufacturing
capacity
Growth strategy
4C Spider
• 2013: 74,000
• 2014 Q3 YTD: 52,000
• 9 new models 2014 - 2018
Sales volume
Mid-size
(2015)
Compact (2) Full-size UVs (2) Specialty
|--------------------------------- 2016 to 2018 -------------------------------|
• Program development in line with plan – public reveal
of first car June 2015
• Development of second vehicle underway, 2016 launch
• Dealer network development in-process
Update from May 6th
Mid-size
January 17, 2015 11 Bank am Bellevue
Maserati line up expansion will drive growth
• 2013: 11,600
• 2014 Q3 YTD: 24,100
• 6 new models and
refreshes 2014 - 2018
Sales volume
GranCabrio Quattroporte Ghibli GranTurismo Levante
(2015)
Alfieri Coupe Alfieri Cabrio
• Expanding portfolio to key luxury market segments
• Ghibli – full size sedan (2013)
• Levante – luxury SUV (2015)
• Increased global volumes leveraging high quality, under-
utilized Italian manufacturing capacity
Growth strategy
January 17, 2015 12 Bank am Bellevue
Key product launches – Q4 2014 to 2016
Minivan
100 Sedan
Minivan PHEV
NEW VEHICLE OR RENEWAL OF EXISTING NAMEPLATE
MID-CYCLE FRESHENING
Dart
D-CUV
Gr. Cherokee
C-SUV
ProMaster City
Pickup & Chassis Cab
Fiorino
Mid-size P/U (EMEA)
Mid-Size Sedan
Alfieri
• Renewal of minivan with segment first PHEV
• Enter high volume compact sedan segment
• New look for heritage products
• Reformulate Dart and add new CUV
• Add first small SUV from Jeep
• Renewal of Compass/Patriot
• Expand commercial van portfolio
• Refreshed look for truck and CC lineup
• Expand into CUV segment & compact P/U segment
• Critical renewals of high volume A & B segment vehicles
• Renewal of mid-size van product
• Add mid-size pickup in EMEA
• Beginning of new Alfa Romeo strategy
• First vehicle launch is high volume mid-size sedan
• Expand portfolio to growing luxury SUV segment
• Add performance coupe model
Second Vehicle
Levante
Renegade
Challenger
B-Segment (EMEA)
Compact P/U (LATAM)
500X
A-Segment (LATAM)
Charger
January 17, 2015 13 Bank am Bellevue
Vehicle assembly footprint and capacity utilization
Capacity utilization based on Harbour definition (units produced / line rate x 16 hours x 235 days)
* Number of plants
Enablers to Reach 7M Vehicles
• Chinese JV volume
• Increase Italian plant
utilization
• Pernambuco launch
• Eliminate production
bottlenecks / add shifts
2013 Target 2018
>100% >100%
Capacity Utilization
NAFTA
2013 Target 2018
66%
>100%
Capacity Utilization
EMEA
2013 Target 2018
53%
>100%
Capacity Utilization
APAC
2013 Target 2018
>100% >100%
Capacity Utilization
LATAM
12* 12
4 5 2 3
11 11
January 17, 2015 14 Bank am Bellevue
Capex spending increases to
a peak in 2016 to support
the heavy cadence of
new/refreshed product
programs
R&D spending increases
slightly over Plan period,
peaking in 2016
Spending as a percentage of
revenues in-line with
industry average at end of
plan period
Flexibility to reduce capex
and R&D spending if
industry outlook
deteriorates
€B
Capex and R&D Spending
5.4 5.7
3.4 3.7
8.8 9.4
2013A 2014E 2015E 2016E 2017E 2018E
PP&E Capex Total R&D
Plan
Ind
ust
ry
Ou
tlo
ok
vs.
Pla
n
As planned
Lower Minimum to
sustain
operations
Capex range
~10% Capex and R&D
% Revenues ~8%
January 17, 2015 15 Bank am Bellevue
Margin expansion - opportunities exceed risks
NAFTA
LATAM
EMEA
APAC
Increased volume leverage
Product portfolio expansion
Introduce Alfa Romeo brand
Improved fleet mix
Legacy products replaced
Lower R&D after 2016
Industry volumes peaking
Heightened focus on recalls
Regulatory compliance cost
Improved portfolio mix
New Pernambuco plant
Jeep production localized
Refreshed Fiat product line-up
Market growth resumption
Continued inflationary pressures
More competitors localized
Full capacity utilization
~40% of production exported
Refocus Fiat brand
Moderate market recovery
Continued pricing pressures
Fleet mix still high
Overcapacity in region
Projected industry growth
Growing SUV segment
Jeep production localized
Introduce Alfa Romeo brand
Price pressure at low end
Investing for long-term
-2.9%
2-3%
2013 Target
4.9%
>10%
2013 Target
7.2%
>10%
2013 Target
5.0%
6-7%
2013 Target
Architecture convergence
Industrial synergies
Supply chain optimization
EBIT Margin
EBIT Margin EBIT Margin
EBIT Margin
January 17, 2015 16 Bank am Bellevue
2014-2018 financial targets
Revenues
EBIT & Margin pct.
Net Income
2016E 2018E
Capex (IFRS)
~€93B ~€104B
€3.6-4.0B(*)
3.9%-4.3%(*)
€5.1-5.9B
4.9%-5.7%
€0.6-0.8B(*)
EPS €0.44-€0.60(*)
€1.9-2.5B
EPS €1.6-€2.1
€7.5-8.5B €10.5-11.5B
Net Ind. Debt
€9.8-10.3B €9.8-10.3B
2013
€87B
€3.5B(*)
4.1%(*)
€0.9B(*)
EPS €0.1(*)
€7.5B
€9.7B(**)
2014E
(**) Net Debt after VEBA stake acquisition
(*) Excluding Unusuals
~€132B
€8.7-9.8B
6.6%-7.4%
€4.7-5.5B
EPS €3.9-€4.4
€8.5-9.5B
~€0.5-1.0B
January 17, 2015 17 Bank am Bellevue
Business plan – sell-side analysts’ views
Did Fiat miss an opportunity to raise capital?
(UBS, BUY)
“...We like decisions to de-emphasize Fiat Europe and
focus Minivan on Chrysler brand... we have argued
before in favor of some form of equity or quasi equity”
Nice plan, but this Company needs a Capital Raise
(Bernstein, Market Perform)
“...we admire ambition ...thanks to Jeep in China,
improved Europe, results are achievable...Company
surely needs a capital raise (of some form) for this plan
to be affordable – and de-risked”
Two speed FCA FY18 Plan
(JP Morgan, Neutral)
“...in the first part of plan the bulk of the expansion
plan... Second speed substantial cash flow to
deleverage”
What if credit markets weaken as debt grows?
(Citigroup, Sell)
“...biggest issue is the accumulation of debt and
amount of capex required to get to 2018 targets
Blue sky 2018 pitch
(Bank of America – Merrill Lynch, Underperform)
“...we like the plan to address capacity issue in Europe
with Maserati & Alfa ... see growth potential for Jeep ...
plan is very back-end loaded however with 2016 EBIT
only at €5.5bn & net debt at still €10bn.”
Again jam Tomorrow
(Deutsche Bank, Sell)
“...with €10B net debt...no FCF in the foreseeable
future...remain highly leveraged OEM”
Sceptics of targets but interest upside
(Barclays, Overweight)
“... Fiat gross liquidity is not a challenge ... business
should no longer be viewed as Europe based ... Legacy
Chrysler brands is where there are the greatest
opportunities”
Alfa Papa: One last go for Sergio
(Exane-BNP, Sell)
“... Benchmarking against the best: Alfa has its work cut
out.. ”
January 17, 2015 18 Bank am Bellevue
Capital market transactions announced on Oct 29th
• 100M shares placed on the NYSE in December 2014 including:
− existing treasury shares (35M shares)
− shares issued in replacement of shares of Fiat S.p.A. shareholders exercising their cash exit rights related to the recent merger transaction (~54M shares)
• Issued $2.875 billion mandatory convertible securities in December 2014 which will be treated as equity
• Separation of Ferrari from FCA expected in 2015 effected through:
− public offering of 10% of Ferrari
− distribution of FCA’s remaining interest in Ferrari to FCA shareholders including the holders of the mandatory convertible securities
Track – record
2013 Volume: 7,100
Willful and intended limitation
2013 Revenues: +5% (€2,335M)
Resilient true like-for-like growth
2013 EBIT margin: 16% (€364M)
Superior profitability and cash generation
Opportunities
Strong track record
and potential
Substantial global wealth creation
Broader geographical shipments
New revenue streams
Continued higher vehicle prices
Margin expansion
January 17, 2015 19 Bank am Bellevue
January 17, 2015 20 Bank am Bellevue
Capital markets transactions and benefits
Strengthen balance sheet
Reduce business plan execution risk
Full value of Ferrari unlocked for benefit of
FCA shareholders
Preserves Ferrari’s brand exclusivity strategy
Common stock
and mandatory
convertible
(DONE)
Ferrari separation
(by end of 2015)
Expected to reduce net industrial debt by ~€4 billion
January 17, 2015 21 Bank am Bellevue
1-Oct 8-Oct 15-Oct 22-Oct 29-Oct 5-Nov 12-Nov 19-Nov 26-Nov 3-Dec 10-Dec 17-Dec 24-Dec 31-Dec 7-Jan
FCA stock trading migration to NYSE
Announced
capital markets
transactions
(October 29)
Oct 13 – Dec 10
Average Daily Volume
MTA 17.6M (87%)
NYSE 2.7M (13%)
Oct 1 – Oct 10
Average Daily Volume
MTA 23.7M (100%)
NYSE -0-
Dec 15 – Jan 12
Average Daily Volume
MTA 18.5M (72%)
NYSE 7.0M (28%)
Equity Offering &
Mandatory
Convertible
Securities Pricing
(December 11) Start of FCA
trading on
NYSE
(October 13)
FCA
Average Daily
Common
Stock Trading
Volume
January 17, 2015 22 Bank am Bellevue
Additional balance sheet enhancement
0
5
10
15
20
25
Minimum to sustain operations
Allows for risk
mitigation
Total Liquidity
Target
€B
Today Post
ring-fencing
Elimination of
ring-fencing
Enhanced financial flexibility
Reduces liquidity requirements and
cost of carry
Target to have positive net industrial
cash by end of 2018
Chrysler ring-fence removal (by mid-2016)
Current Chrysler Group bonds with covenant restrictions on cash:
$3.0B 8.0% Notes due 2019 – callable as of June 15, 2015 at 104
$3.2B 8¼% Notes due 2021 – callable as of June 15, 2016 at 104⅛
January 17, 2015 23 Bank am Bellevue
FCA – the road ahead
Execute the business plan - continued volume growth with margin expansion
Eliminate Chrysler ring-fence to enhance financial flexibility
Separate Ferrari to unlock value for shareholders
January 17, 2015 24 Bank am Bellevue