Fiat Chrysler swings to loss as virus hits output, demand

MILAN (AP) — Fiat Chrysler Automobiles on Tuesday reported a first-quarter net loss of 1.7 billion euros ($1.84 billion) due to a steep decline in car sales during the coronavirus pandemic.

The Italian-American carmaker has withdrawn full-year earnings forecasts due to the volatility of the economic situation provoked the virus, which includes stalled production and shuttered dealerships. Fiat Chrysler confirmed it remained committed to full merger with French carmaker PSA Peugeot, which it aims to complete by early 2021.

The first-quarter loss compared with earnings of 619 million euros during the same period of 2019. Revenues sank 16% to 20.5 billion euros from 24.5 billion euros last year, as global shipments slumped 21% to 818,000 with production suspended in all regions and a collapse in global demand.

Only North America posted a profit, with earnings before interest and taxes at 548 million euros. Plants there were closed only one week in the quarter.

Fiat Chrysler said its available liquidity was 18.6 billion euros at the end of the first quarter, including 6.25 billion euros in a fully drawn revolving credit. The automaker has available another 3.5 billion euros bridge credit to help face the crisis. Cash flow from operating activities was down 364% to a negative 2.82 billion euros.

Fiat Chrysler restarted production April 27 at its Sevel truck-making plant in Italy, a joint venture with PSA Peugeot, which is running at 70% of normal capacity. A joint venture in China also has been restarted successfully, the company said.

"Production in other regions will be phased in over a period of time and aligned to consumer demand,’’ Fiat Chrysler said, adding that it was ready to restart both production and sales as governments permit.

“The pandemic has had and continues to have a significant impact on our operations,’’ CEO Mike Manley said in a statement. He expressed ”the utmost confidence in our ability to navigate through this crisis and emerge well-positioned to grow and prosper on the other side.’’