As Brazil Lags, North America Will Step Into The Breech
Fitch Ratings says Fiat might benefit from its tie-up with Chrysler in the medium to long-term, but the Financial Times Lex column sees the link as a life-saver.
Fitch, the U.S. bond and credit rating agency, said it awarded Fiat a “negative” outlook, the only negative rating in its list of 14 global automotive manufacturers which are rated from “stable” to “positive”. The four “positives” are Hyundai, Kia, Ford and GM.
“The negative outlook chiefly reflects the increasing economic challenges and uncertain environment, the execution risk in the combination with Chrysler, and Fiat’s intrinsic weaknesses,” Fitch Ratings said in a report.
Lex though, in a gushing outburst of praise entitled “Fiat: America the beautiful” said Fiat’s European auto operations are sputtering badly, while the old stalwart of Latin America is losing ground too, leaving North America and Chrysler as the sole bright spot.
“South America has been a saving grace, but Fiat’s main market of Brazil, which registered blistering economic growth of 7.5 per cent in 2010 and a 12 per cent jump in auto sales, faces the prospect of a mild recession. Its 611,000 unit sales there last year were nearly on a par with those in its home market of Italy and more than it sold in every other European country combined,” Lex said.
“Chrysler’s U.S. sales jumped 45 per cent year-on-year in November on new models. Chrysler contributed €9.3 billion to overall group automotive revenue of €16 billion in the third quarter. The streets of America are paved with gold for this Italian immigrant,” Lex said.
Neil Winton – December 15, 2011