Fiat Chrysler made $29M profit in its final year before Stellantis merger

Fiat Chrysler Automobiles NV posted $29 million (24 million euro) in net income for 2020, a 99% decline year-over-year as the coronavirus pandemic slashed production and demand globally.

Stellantis NV, the transatlantic merger between FCA and French rival Groupe PSA that closed in January, reported early Wednesday annual and fourth-quarter results for both automakers during which they operated as completely separate companies.

PSA posted $2.445 billion (2.022 billion euro) in consolidated income for 2020, down 44%, on $73.461 billion (60.734 billion euro) in revenue, down 19%.

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Stellantis shares were rising 1.35% in pre-market trading Wednesday as the world's fourth largest automaker by volume forecasted an adjusted operating income margin between 5.5% and 7.5% for 2021 without significant COVID-19 lockdowns.

“These figures demonstrate the financial soundness of Stellantis, bringing together two strong and healthy companies," Stellantis CEO Carlos Tavares said in a statement. "Stellantis gets off to a flying start and is fully focused on achieving the full promised synergies.”

FCA made $0.02 (0.02 euro) per share on $104.839 billion (86.676 billion euro) in revenue for the year, a 20% decrease, as worldwide shipments fell 22%. Pre-tax earnings were down 44% to $4.526 billion (3.742 billion euro). The Italian American automaker had not provided an updated guidance as COVID-19 spread across the globe, halting production last spring and hitting its fleet sales to commercial and government customers. It originally had forecast a best-ever $7.7 billion in pre-tax earnings for 2020.

In the fourth quarter, FCA's net income fell 1% to $1.888 billion (1.561 billion euro) compared to the last three months of 2019. Despite the decrease, all regions as well as the Maserati brand were profitable for the first time since the first three months of 2018.

For the full year, industrial-free cash flow was down 70% to $755 million (624 million euro) from the start of 2020. Net financial expenses were $1.195 billion (988 million euro) in 2020, a 1.7% decrease.

FCA's earnings before interest and taxes in North America fell to $6.472 billion (5.5251 billion euro) in 2020. It posted an 8.9% margin in North America, slightly down from 9.1% in 2019 despite the eight-week production shutdown last spring. The automaker will give eligible hourly full-time United Auto Workers-represented employees profit-sharing checks of up to $8,010 each this year, an increase of 10% from last year after the union negotiated an increased contribution in 2019.

The region also achieved a record fourth-quarter margin of 11.4% from selling higher-priced vehicles and cuts to advertising. Stellantis this year is entering larger, more profitable SUV segments with the launch of the new three-row Jeep Grand Cherokee L SUV before the end of the month at its new $1.6 billion Mack Assembly Plant on Detroit's east side. Later this year, the plant also will produce the redesigned two-row Grand Cherokee. Warren Truck is expected to launch the larger Jeep Wagoneer and Grand Wagoneer SUVs in the second quarter.

Employees in Detroit can begin receiving COVID-19 vaccines by appointment next week. Some 1,300 workers at the Jeep Cherokee plant began receiving the shots last month in Belvidere, Illinois, where the automaker also cut 150 jobs due to low demand for the compact SUV.

FCA lost $1.110 billion (918 million euro) in Europe, after completing a turnaround plan in 2019 that included a 5,000-employee reduction. PSA did not break out its results by region.  Stellantis expects to see the most cost savings in Europe by extending PSA's platforms to FCA brands like Alfa Romeo, Fiat and smaller Jeeps.

The automakers had promised not to close any plants because of the merger. But Stellantis is in talks with the U.K. government over the future of its Ellesmere Port plant producing the Vauxhall and Opel Astra small car following Britain's departure from the European Union.

Fiat Chrysler made $7 million (6 million euro) in South America. In Asia, FCA lost $140 million (116 million euro).

FCA's Maserati lost $281 million (232 million euro)  in 2020. The luxury brand began a new chapter last summer as its introduced its first electrified models and a new super sports car. In 2019, it had brought in new leadership, cut dealership stock and announced $1.8 billion in manufacturing investments in Italy.

FCA beat the annual results of at least one crosstown rival. In 2020, Ford Motor Co. recorded its first annual loss — $1.3 billion — since the Great Recession on $127.1 billion in revenue. General Motors Co.'s $6.4 billion profit on $122 billion in revenue was down 4% from 2019 when it had been hindered by a national 40-day United Auto Workers strike.

bnoble@detroitnews.com

Twitter: @BreanaCNoble