FCA denies rumours that Jeep is for sale

Recent arrivals like the redesigned Compass are expected to help boost Jeep’s sales to around the 2 million mark this year.

Recent arrivals like the redesigned Compass are expected to help boost Jeep’s sales to around the 2 million mark this year.

Published Jan 16, 2018

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Detroit - Fiat Chrysler CEO Sergio Marchionne has squashed rumours that the company could sell its much coveted Jeep brand to another carmaker or split up in any way.

Speaking at the Detroit Motor Show on Monday, Marchionne said the Jeep SUV brand could help FCA double its profits. Jeep is one of several brands in a portfolio that also includes Maserati, Alfa Romeo and Fiat.

"We're not going to break up anything, I never suggested that we would break (FCA) up and give it to anybody," he told a news conference.

FCA's share price has shot up more than 30 percent so far this year on a bullish outlook for the motor industry, Jeep growth expectations and media speculation that Marchionne's final year at the helm could prompt strategic deals such as spin-offs, technology alliances and disposals.

The popularity of the Jeep brand, which is targeting sales of 2 million vehicles this year, has prompted talk that it could be spun off from the group, as happened with Ferrari, or sold off completely. By comparison, Jeep sold just 1.42 million vehicles in 2016, the most recent full year for which figures are available.

While Marchionne acknowledged that both Jeep and truck brand Ram were sufficiently strong to exist on their own, he reiterated that he needed to worry about what would be left behind.

"We need to talk about the profitability at Jeep but also at what will be left behind," he said. "They all need to stay alive."

Marchionne confirmed the company's targets for 2017 and for 2018, including a plan to erase all debt and generate up to 5 billion euros (R75bn) in net cash by the end of this year.

The 65-year-old executive is due to step down in early 2019 and a successor will be appointed from within FCA.

Finance chief Richard Palmer, European head Alfredo Altavilla and Jeep boss Mike Manley have often been cited as possible candidates, according to sources close to the company.

Marchionne said there are other possible candidates who are not in the media spotlight.

FCA has been the subject of merger speculation, especially after its unsuccessful 2015 attempt to tie up with General Motors. Its share price jumped to record highs in August after reports of interest from Great Wall Motor and Hyundai .

Marchionne said on Monday that the company did not need a partner and could continue on a standalone basis.

Reuters

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