Report Cards for Automakers – Chrysler/Fiat (FIATY)
Fiat (FIATY) kicked off 2014 by paying nearly $3.7 billion for the United Auto Workers’ 41.5% share of Chrysler. FIATY now owns all of Chrysler, and could spin off the iconic Detroit automaker in an IPO by October. The company is bullish on growth: It hopes to sell 3.1 vehicles in the U.S. this year — that’s 1 million more than it sold in 2013.
At a recent briefing, CEO Sergio Marchionne shared plans to grow his company’s North American sales by 48% over the next five years. Fiat CEO Richard Palmer recently said its focus is using cash for research and development rather than paying dividends or creating a finance unit. That focus further highlights FIATY as a growth buy.