All that matters is what s ahead. Investor meetings in U.S. New York February 7-8, 2013

Transcription

1 All that matters is what s ahead. Investor meetings in U.S. New York February 7-8, Novembre, 2010

2 Safe Harbor Statement Certain information included in this presentation, including, without limitation, any forecasts included herein, is forward looking and is subject to important risks and uncertainties that of the assumptions underlying this presentation or any of the circumstances or data mentioned in this presentation may change. Any forward- looking statements contained in this could cause actual results to differ materially. The Group s presentation speak only as of the date of this presentation. We businesses include its automotive, automotive- related and other sectors, and its outlook is predominantly based on its interpretation of what it considers to be the key economic expressly disclaim a duty to provide updates to any forwardlooking statements. The future financial targets included in this presentation were not examined or reviewed by Fiat s auditor factors affecting these businesses. Forward- looking statements neither any other accounting firm. Such financial targets were with regard to the Group's businesses involve a number of important factors that are subject to change, including, but not limited to: the many interrelated factors that affect consumer confidence and worldwide demand for automotive and automotive-related products and changes in consumer preferences that could reduce relative demand for the Group s products; governmental programs; general economic conditions in each of the Group's markets; legislation, particularly that relating to automotive-related issues, the environment, trade and commerce and infrastructure development; actions of competitors in the various industries in which the Group competes; production difficulties, including capacity and supply constraints, excess inventory levels, and the impact of vehicle defects and/or product recalls; labor relations; interest rates and currency exchange rates; our ability to realize benefits and synergies from our global alliance among the Group s members; substantial debt and limits on liquidity that may limit our ability to execute the Group s combined business plans; political and civil unrest; earthquakes and other risks and uncertainties. Any based on numerous variables and assumptions that are inherently uncertain and may be beyond the control of Fiat s management. Such future financial targets, such projections, by their nature, become less reliable with each successive year. Accordingly, there can be no assurance that the such financial targets will be realized and actual results may vary materially from those shown and as such no undue reliance should be placed upon such projections. Fiat does not assume and expressly disclaims any liability in connection with any inaccuracies in any of these forward- looking statements and projections or in connection with any use by any third party of such forward- looking statements and projections. This presentation does not represent investment advice or a recommendation for the purchase or sale of financial products and/or of any kind of financial services. Finally, this presentation does not represent an investment solicitation in Italy, pursuant to Section 1, letter (t) of Legislative Decree no. 58 of February 24, 1998, as amended, nor does it represent a similar solicitation as contemplated by the laws in any other country or state. February 7-8, 2013 Investor meetings in New York 2

3 Fiat s options and rights to increase its stake in Chrysler Group JULY 3, 2012 Fiat notified VEBA Fiat s exercise of its option to purchase a portion of VEBA s ownership interest in Chrysler Tranche representing ~3.3% of Chrysler s outstanding equity SEPTEMBER 26, 2012 Fiat sought declaratory judgment from Delaware Chancery Court to confirm price to be paid for the stake, since VEBA failed to deliver the ownership interest under the Call Option Dispute involves only price, not the validity of the option JANUARY 3, 2013 Fiat exercised its option to purchase a second tranche, representing ~3.3% of Chrysler s outstanding equity Once the transactions are completed as contemplated, Fiat will hold 65.17% of outstanding equity in Chrysler VEBA Call Option What: Fiat has the option to purchase 40% of VEBA s current interest in Chrysler Group ( Covered Interest ) When: from July 1 st, 2012 until June 30 th, 2016 How: option is exercisable not in excess of 20% of Covered Interest in any 6-month period; Covered Interests are not transferable by VEBA (other than under Equity Recapture Agreement) Price: before an IPO, based on a market multiple not to exceed Fiat s multiple applied to Chrysler reported LTM EBITDA less net industrial debt; following an IPO, based on trading price of common stock Equity Recapture Agreement What: Fiat receives all proceeds from Chrysler ownership interest held by VEBA over a threshold (and once such threshold is reached, any remaining interests held by VEBA are turned over to Fiat) Threshold: $4.25bn plus 9% p.a. compounded annually from Jan 1, 2010 Note: under the Equity Recapture agreement, Fiat may purchase any remaining membership interest held by VEBA at the Threshold less any proceeds previously received by VEBA February 7-8, 2013 Investor meetings in New York 3

4 2012 IN REVIEW

5 FY 2012 Executive summary Fiat Group closed 2012 at historical highs Revenues at 84bn Trading profit of 3.8bn EBIT of 3.7bn Net profit at 1.4bn ( 1.7bn ex-unusuals) Net industrial debt at 6.5bn Total available liquidity in excess of 20bn Worldwide shipments for mass-market brands up 6% to 4.2mn units Successfully accessed capital markets through several bond issuances totaling 2.5bn in 2012 ( 0.7bn in Q4) Completed mandatory conversion of special share classes into ordinary shares Guidance for 2013 confirms targets underpinning Group development plans presented on Oct 30, 2012 Others 1% Luxury brands 3% EMEA 20% Components 7% APAC 4% NAFTA 71% LATAM 13% Italy <10% NAFTA 52% Worldwide shipments for mass-market brands of mn units Revenues in 88-92bn range Trading profit in bn range Net profit of bn Net industrial debt of ~ 7.0bn APAC 7% Nearly break-even EMEA mass-markets brands Luxury & Performance brands Components Others and Eliminations LATAM 28% ~( 0.7)bn ~ 0.4bn ~ 0.2bn ~ (0.1)bn February 7-8, 2013 Investor meetings in New York 5

6 Mass-market brands NAFTA highlights FINANCIAL PERFORMANCE Continued strong performance in better than expected markets Revenues up 29% (+19% at constant exchange rates) primarily due to higher vehicle volumes and positive pricing impact, reduced by unfavorable mix Trading profit up 59% vs. last year (+47% at constant FX rates) Trading margin increased 120 bps to 6.2% Volume increases and positive net pricing partially offset by higher advertising expense and higher industrial costs, impacted by additional shifts at certain plants and higher capacity utilization Shipments (k units) Revenues ( mn) TOTAL NAFTA FY 12 Trading Profit ( mn) EBIT ( mn) FY 11 PRO-FORMA 2,115 1,783 43,521 33,800 2,693 1,693 2,741 1,770 Note: pro-forma calculated by including Chrysler results as if consolidated from Jan 1, 2011 COMMERCIAL PERFORMANCE & HIGHLIGHTS Vehicle shipments up 19%, including U.S.: 1,748k units (+20%) Canada: 255k vehicles (+9%) Mexico: 98k units (+17%) Group vehicle sales outpacing market with an 18% growth to 1,989k vehicles, primarily reflecting a 21% increase in U.S. sales Cars up 39% in NAFTA (U.S. +41%) Trucks up 11% (U.S. +14%) All brands up significantly, posting double-digit sales increases in NAFTA as a whole Fiat +107%, Chrysler +40%, Ram +14%, Dodge +13%, Jeep +12% February 7-8, 2013 Investor meetings in New York 6

7 Mass-market brands LATAM highlights TOTAL LATAM FY 12 Shipments (k units) Revenues ( mn) Trading Profit ( mn) EBIT ( mn) FY 11 PRO-FORMA ,062 11,068 1,063 1,410 1,032 1,385 Note: pro-forma calculated by including Chrysler results as if consolidated from Jan 1, 2011 FINANCIAL PERFORMANCE Market improved throughout the year closing with a good performance, particularly in Brazil reaching a historical level of 3.6mn units thanks to reduction in vehicle tax and lowest real interest rate in history Best Q4 of Brazilian industry ever (~1mn units ) Revenues in line with prior year (+5% at constant exchange rates) with increased volume offset by negative currency translation impacts Q4 up 5% vs. last year (+13% at constant exchange rates) Trading profit came in robust, maintaining a double-digit margin despite 25% decrease over prior year (-22% at constant exchange rates) Reduction attributable primarily to cost inflation, pricing pressure and unfavorable currency translation impacts, only partly offset by higher volumes and efficiency gains COMMERCIAL PERFORMANCE & HIGHLIGHTS Total Group shipments up 5% in the year Brazil: 845k shipments (+9% vs. a year ago) Argentina: 84k shipments (-15%) Other LATAM markets: 50k shipments (-4%) Fiat outperformed a strong Brazilian market reaching a 23.3% share (up 110bps vs. 2011) increasing distance from #2 by 33bps At region level, share up 60bps to 16.8% Maintained leadership in Brazil, being leader for 11 years Company & dealer inventory levels at 24 days supply at Dec-end, 7 days lower than 2011 February 7-8, 2013 Investor meetings in New York 7

8 Mass-market brands APAC highlights TOTAL APAC FY 12 Shipments (k units) Revenues ( mn) Trading Profit ( mn) EBIT ( mn) FY 11 PRO-FORMA ,128 2, Notes: Pro-forma calculated by including Chrysler results as if consolidated from Jan 1, 2011 APAC industry reflects aggregate key markets where Group is competing (i.e. China, India, Australia, Japan, South Korea) FINANCIAL PERFORMANCE Stable trading conditions across the region with demand increasing in most of Group s key markets Revenues up 50% mainly driven by Jeep Shipments up 39% Trading profit up 80+% over last year s level Trading margin up 140 bps to 8.3% Increase primarily driven by volume growth and favorable FX impact, partially offset by increased industrial costs and selling expenses to support regional expansion EBIT more than double last year s level reflecting mainly growth in trading profit and improvement in India JV COMMERCIAL PERFORMANCE & HIGHLIGHTS Retail sales (incl. JVs) up 28% to 115k units on the back of strong performance of Jeep, Fiat and Alfa Romeo brands Jeep sales (~64% of total APAC sales) almost double last year s level Chrysler brand almost doubling last year s level with the return of all-new 300C and Grand Voyager Launched Chrysler Ypsilon in Japan in December, the latest addition to Chrysler portfolio Launched Fiat Viaggio in September 2012 Second best selling vehicle (behind Jeep Compass) in the region for the Group in Q4 12 Group-owned distribution company to take over activities in India to begin operations in 2013 February 7-8, 2013 Investor meetings in New York 8

9 Mass-market brands EMEA highlights TOTAL EMEA FY 12 Shipments (k units) Revenues ( mn) Trading Profit ( mn) EBIT ( mn) FY 11 PRO-FORMA 1,012 1,180 17,800 20,078 (704) (512) (738) (897) Note Pro-forma calculated by including Chrysler results as if consolidated from Jan 1, Harbour definition: 235 days p.a. / 16 hours per day 2 Technical definition: 280 days p.a. / 3 shifts per day FINANCIAL PERFORMANCE Difficult trading conditions persisting throughout the year, particularly in Med-countries with Germany reversing its upward trend in H2 Highly competitive environment mainly driven by structural overcapacity in the Region with enduring price pressure Revenues down 11% for FY (-10% in Q4), mainly reflecting volume declines FY trading loss in line with expectations (Q4 losses nearly halved vs. a year ago) Negative volumes and pricing partially offset by industrial efficiencies, WCM synergies and disciplined SG&A spending Further cost containment actions undertaken in latter part of the year EBIT loss (ex-unusuals) at 544mn Result from investments positive for 160mn, flat vs COMMERCIAL PERFORMANCE & HIGHLIGHTS Total FY shipments down ~14% or 168k units (Italy -112k, France -29k & Germany -14k) Passenger cars: down 14% to 810k units LCVs: down 15% to 202k units, with decline mainly attributable to sharp market contraction in Italy FY share performance in Europe for both passenger cars and LCVs reflecting unfavorable market mix Strict management of supply and demand function Company & dealer inventory stable on a quarterly and yearly comparison (at ~2-months supply) Utilization rate at plants in EMEA, including JVs, stable at 68% (Harbor 1 definition) or 44% (Technical 2 definition) February 7-8, 2013 Investor meetings in New York 9

10 Jeep brand All-time global sales record in 2012 Vehicles (000 s) A ~20% sales growth over 2011 to 702k vehicles Previous record in 1999 (675k vehicles) Increased sales for Jeep in all major global regions Jeep expanding internationally, with sales steadily growing outside NAFTA +19% +41% % +49% Global sales Sales outside NAFTA +26% +57% Best U.S. sales since 2005 (155k) % % 103 Best year ever globally % % % % 91 Best U.S. sales year (62k) +27% +16% Best year ever globally and in U.S February 7-8, 2013 Investor meetings in New York 10

11 Luxury & Performance brands Ferrari & Maserati FY revenue up 8% to 2.4bn Increase driven by higher volumes, a more favorable product mix and personalization program contribution All-time record shipments for the brand to 7,318 street cars for FY, +5% vs cyl models +3%; 12-cyl +11% North America (+15%) remained #1 market Europe: strong performance in UK (+20%), Germany (+8%) and Switzerland (+17%); 46% decline in Italy China, Hong Kong & Taiwan up 4% FY trading profit up 12% to 350mn Improvement driven by higher volumes, a more favorable product mix and positive contributions from licensing and financial services Margin remained strong at 14.4% (+50 bps vs. 2011) FY revenue of 634mn (+8%) Improvement attributable primarily to higher sales volumes and positive currency impacts FY shipments of 6,288 units, up 2% vs USA: 2.9k units, brand s best volume shipment performance in 8 years China: 0.9k units, ranked as the brand s second largest market (+10% vs. 2011) Mid-East: +37% Europe: 1.1k units, down ~30% vs. a year ago FY trading profit of 42mn, in line with last year s level Positive impact of higher volumes and continued improvements in operating costs offset by production start-up costs for new models Margin at 6.6% USA 26% Others 26% European Top-5 33% Japan 4% China, Hong Kong & Taiwan 11% USA 46% European Top-4 11% Others 23% Japan 5% China 15% February 7-8, 2013 Investor meetings in New York 11

12 FY 12 net industrial debt walk Debt position reduced from September level mn Change in Net Industrial Debt (1,016) Cash Flow from operating activities, net of Capex (1,191) 7, (2,350) (5,529) 292 (7,530) (36) (81) (6,545) December 31, 2011 Industrial EBITDA Financial Charges & Taxes Change in Funds & Other Working Capex Investments, capital Scope & Other Capital increase /Repos/ Dividends FX translation effect December 31, 2012 Positive cash contribution from Chrysler more than offset by absorption for Fiat excl. Chrysler Fiat excl. Chrysler: cash flow negative 2.6bn (net industrial debt at 5.0bn at year-end) driven by net loss, negative change in working capital and Capex on new products Chrysler: positive cash flow of 1.6bn, despite increased Capex of 4.3bn (net industrial debt at 2012-end reduced to 1.5bn) February 7-8, 2013 Investor meetings in New York 12

13 Group pension & OPEB Preliminary estimates of impact for IAS 19 rule change bn 2012 IAS IAS 19 revised IAS 19 IAS 19 revised IMPACT ON P&L Current service costs (0.27) (0.27) Expected return on plan assets Interest costs on Pension Plans (1.17) - Other costs (0.02) - Impact on Trading Profit (0.05) (0.27) Interest costs (0.14) (0.39) Impact on Net Income (0.19) (0.66) 1 IMPACT ON NET EQUITY (4.8) 2 Interest cost: based on discount rate and benefit obligation Expected return on plan assets: based on market value of plan assets and assumed long-term rate of return Pensions & OPEB net liability on the balance sheet does not include unrecognized actuarial gains/losses Actuarial gains/losses are amortized into P&L Net interest cost: based on discount rate applied to net liability (gross liability less plan assets) Net Pensions & OPEB liability fully recognized on the balance sheet Actuarial gains/losses will no longer impact the P&L of which: Group Minority (2.9) (1.9) bn Notes 1 Net interest cost of 0.25bn under IAS 19 revised compares with 0.23bn surplus of expected return on plan assets over interest on gross liability 2 Unrecognized actuarial gains/losses accumulated at December 31, 2012 not reflected in net Pension & OPEB liability but recognized on January 1, 2013 under IAS 19 revised through an equivalent reduction in Net Equity Dec. 31, 2011 (2.5) Increase in Chrysler pension underfunded status Chrysler pension underfunded status and impact of IAS 19 revised Dec. 31, 2012 PENSION & OPEB PERIOD COST IN 2013 EXPECTED IN LINE WITH 2012 IAS REVISED (2.3) (4.8) February 7-8, 2013 Investor meetings in New York 13

14 LOOKING AHEAD

15 Industry trend and forecast (mn units) NAFTA (passenger cars, SUV, pick-up trucks & LCVs) 17.5 ~ LATAM (passenger cars & LCVs) ~ Revised forecast Revised forecast 13.5 Chrysler 2009 Investor Day Fiat 2010 Investor Day E 2014E 2015E 2016E E 2014E 2015E 2016E APAC * (passenger cars & LCVs) EU27+EFTA (passenger cars & LCVs) ~ ~ Fiat forecast Fiat 2010 Investor Day Revised forecast E 2014E 2015E 2016E * Industry reflects aggregate key markets where Group is competing (i.e. China, India, Japan, Australia, South Korea) E 2014E 2015E 2016E February 7-8, 2013 Investor meetings in New York 15

16 Flexible work practices have allowed us to deliver on strong market demand in the Americas CAPACITY UTILIZATION CAPACITY UTILIZATION 120% Harbour definition Technical definition 160% Harbour definition Technical definition 100% 80% 60% 40% 20% 73% 49% 92% 60% 107% 72% 140% 120% 100% 80% 60% 40% 20% 140% 140% 85% 85% 152% 93% 0% % INDUSTRIAL FLEXIBILITY Stable at ~90% utilization of technical capacity for many years FY 2010 production (mn units) Full utilization including additional shifts (Standard Union Contract Terms) Efficiency improvement (line speed increases) Additional production through extraovertime and holidays FY 2012 production (mn units) Consistent utilization of all flexibility instruments (extra-overtime and holidays) to maximize output Harbour definition: 235 days p.a. / 16 hours per day Technical definition: 280 days p.a./3 shifts per day for LATAM; 265 days p.a./3 shifts per day at all plants (ex Saltillo where applied 2 shifts at 285 days) for NAFTA February 7-8, 2013 Investor meetings in New York 16

17 But Fiat Group isn t immune to the effects of the European Carmageddon EXTERNAL MARKET FACTORS Slump in European market demand, with 2012 being the 5 th consecutive year of decline Passenger car segment troughed in EU27+ EFTA to 12.5mn units in 2012, the lowest level since 1995 and down 20+% from 16mn peak in 2007 Italian market 1.4mn units, the lowest level since 1979 and down 40+% from 2.5mn peak in 2007 European LCV volumes at historical FY lows with 1.6mn units, the lowest level since 1996 and down 30+% from 2.4mn peak in 2007 Pricing pressure, especially for mass market segments Further pressure from Korean and potential Japanese and Indian FTA s Market becoming bi-polar with profitability limited to premium Low-end brands increasingly relevant in mass market Lack of visibility for recovery to pre-crisis level Structural overcapacity of European manufacturers will delay any pricing recovery Industry heavily regulated and no moves to simplify GROUP CAPACITY UTILIZATION IN EMEA (passenger cars & LCVs; including JVs; percent) 88% 56% 80% 52% 68% 44% MARKET EXPECTED TO BE NEARLY FLAT IN 2013 AND THEN GRADUAL RECOVERY TO ~15MN IN 2015/2016 (PASSENGER CARS & LCVS) Harbour definition Technical definition 235 days p.a. / 16 hours per day 280 days p.a. / 3 shifts per day February 7-8, 2013 Investor meetings in New York 17

18 Solving the EMEA quandary 1 REMAIN FOCUSED ON NON-PREMIUM MASS-MARKET AND RATIONALIZE CAPACITY BY CLOSING 1 OR MORE PLANTS OR 2 LEVERAGE HISTORICAL PREMIUM BRAND HERITAGE (ALFA ROMEO & MASERATI), RE-ALIGN PRODUCT PORTFOLIO AND REPOSITION THE BUSINESS FOR THE FUTURE We have chosen the second option because We have installed up-to-date available capacity in EMEA and have little capacity left elsewhere We have at least 3 brands that are capable of competing in the higher margin business Fiat-Chrysler has developed over the last 3 years the relevant architectures and baseline powertrains to enter the premium end of the business and Fiat-Chrysler has access to the NAFTA and APAC markets February 7-8, 2013 Investor meetings in New York 18

19 A rational decision Why Option 1 was rejected Complete absence of any coordinated approach at European level to fix structural overcapacity of the industry In 2011 Fiat ceased production at Termini Imerese plant which had a significant competitive disadvantage due to geographic location and consequent high inbound and outbound logistics costs Further restructuring of Italian industrial footprint by closing 1 or more plants not economically attractive: payback period in excess of 6 years and need for capacity investments elsewhere Closure of a hypothetical plant of 5,000 employees has cash cost of ~ 500mn for redundancies, and other closing costs of ~ 100mn (contract penalties, plant shutdown costs, supplier park liabilities ) Annual cash fixed costs eliminated going forward are ~ 100mn Closure process would take 2 years from announcement Beyond cash costs, also significant non-cash items (asset write-offs) to write-off what is a technically up-to-date and competitive manufacturing infrastructure Therefore, since capacity is needed for international volume expansion of Jeep and development of Maserati, Alfa Romeo, there would be further cash out for investments to add manufacturing infrastructure in another jurisdiction Additionally, other less quantifiable but nonetheless significant items were also considered Negative impacts in the Italian marketplace Business discontinuity due to potential strike actions Impact on supplier park, including Group s component plants Social impact MORE CAPITAL INTENSIVE FOR NO REAL RESOLUTION February 7-8, 2013 Investor meetings in New York 19

20 Our strategy going forward 1. Focus Fiat brand on 500 and Panda as pillar vehicles (brands within a brand) and derive all future products therefrom 2. Reduce/curtail Lancia exposure, preserving uniqueness of Ypsilon and rely on Chrysler s NAFTA development to feed European brand, if economically viable 3. Focus on Alfa Romeo and Maserati to access higher-end of bi-polar market 4. Fully flesh out Jeep brand by developing appropriate products for European and international markets 5. Continue to develop and maintain leading position in LCVs OVERRIDING OBJECTIVES ARE: 1. TO UTILIZE EMEA PRODUCTION BASE TO DEVELOP OUR GLOBAL BRANDS (ALFA ROMEO, MASERATI, JEEP AND THE FIAT 500 FAMILY ) 2. TO SHIFT A SIGNIFICANT PORTION OF PRODUCT PORTFOLIO TOWARDS HIGHER MARGIN OPPORTUNITIES February 7-8, 2013 Investor meetings in New York 20

21 The Maserati brand A journey to the top, technology at forefront ROUNDING OUT PRODUCT OFFERINGS IN LUXURY MARKET 150k P R IC E QUATTROPORTE P O SI T I O NEW QUATTROPORTE GRANTURISMO, GRANCABRIO, GRAN SPORT 100k MASERATI LEVANTE N I N G MASERATI GHIBLI Flagship Sedan E High-End Sedan Luxury SUV Luxury Sportscars 50k Segments already covered New segments covered Now a truly global brand, with presence in all regions (NAFTA #1 market and APAC growing) Strong improvement in brand image and awareness in all regions (> 30% better than 2005 levels), driven by competitive product (style, performance, content) and quality (12 MIS warranty events down 75% vs. 2005) Maserati targeting over 50k units a year by 2015 Significant product rejuvenation and additions to cover 100% of luxury car market (from 20% currently) Significant capital and cost synergies leveraging industrial solutions available in Fiat-Chrysler portfolio Investments in excess of 1bn for period (nearly a third in 2012) February 7-8, 2013 Investor meetings in New York 21

22 The Alfa Romeo brand A global player, moving to the heart of the premium market P R IC E P O SI T I O N I N G B-SEGMENT C-SEGMENT D-SEGMENT E-SEGMENT SPECIALTIES Drive improvement in brand image and awareness, through focus on product excellence as per Maserati experience Build / strengthen distribution network leveraging Jeep global footprint and premium position Leverage capital and cost synergies using industrial solutions available in Group portfolio Invest ~ 1.0bn Capex over plan period Focus on Alfa s brand DNA of sedans and coupes offered with sportiness, performance and style Technical product solutions on par with competitor premium brands, offered at competitive price points Towards a truly global premium brand with significant sales in all regions NAFTA and EMEA to become top markets initially, with APAC offering great opportunity for growth Targeting 300+k units a year by 2016 February 7-8, 2013 Investor meetings in New York 22

23 The Jeep brand Revitalizing an American icon on a global basis FUTURE PRODUCT OFFERINGS IN WORLDWIDE MARKETS P R IC E P O SI T I O N I N G B-SEGMENT C-SEGMENT D-SEGMENT E-SEGMENT SPECIALTY WRANGLER Sales target of 800+k by 2014, underwritten by Maintaining Jeep status as #1 SUV brand in U.S. Expanding internationally and establishing an industrial base for Jeep in China Significantly enlarged distribution network in worldwide markets by 2014 Strengthening product lineup over plan period Wrangler continuing to play iconic presence in SUV market A class leading D-SUV (launching 2013 in NAFTA) Expanding product offerings into new segments not previously addressed, including B-SUV Significant renewal of Grand Cherokee including a new class leading diesel powertrain in NAFTA and an 8-speed transmission New upgrades to exterior, interior and powertrain on Compass and Patriot Leveraging on extreme off-road potential with introduction of Trailhawk models Significant improvement in fuel economy on all key nameplates February 7-8, 2013 Investor meetings in New York 23

24 The pathway to break-even in EMEA Mass-market brands CAPACITY UTILIZATION (passenger cars & LCVs; including JVs; millions of units) % 44% Harbor Technical Harbor Technical Today (2012) ~110% ~70% Tomorrow (by 2016) Note 1 Harbour definition: 235 days p.a. / 16 hours per day 2 Technical definition: 280 days p.a. / 3 shifts per day 3 Includes contract manufacturing for Chrysler, Maserati, PSA, Ford, Opel/Vauxhall Synergies on capital and cost Utilize European manufacturing base for worldwide volume growth Products for competitive offerings in Europe complementary to those produced in NAFTA & LATAM (where production capacity is or will soon be saturated) Architecture allocation Italian footprint for higher value-added production Focus ex-italy on smaller segments Production output from EMEA plants to increase 50+% by mid-decade, driven in equal measure by volumes for export and EMEA market Target to utilize up to 15% of capacity for export, especially for Jeep Small SUV (new segment for Jeep brand), Alfa Romeo and Maserati brands Volumes for EMEA region (up ~25% on the back of gradual market recovery with the rest from new product intros) to drive market share back to 2009 levels Working with Italian Government on actions to improve competitiveness for export New Union agreement in place which addresses labor flexibility issue but need full adherence Targeting ~2.0mn units produced in EMEA, compared to 1.2mn in 2012, to drive break-even trading result in EMEA loss in 2013 expected at similar or slightly lower level than 2012 February 7-8, 2013 Investor meetings in New York 24

25 New business plan actions started Plant investments in Italy Re-launch manufacturing footprint in Italy by leveraging historical premium brand heritage, re-aligning product portfolio and repositioning the business for the future Up-to-date available capacity installed, with little capacity left elsewhere Production kicked-off at Pomigliano & Grugliasco plants, while investment started at Melfi plant Continued use of temporary layoff scheme to allow for flexibility during industrialization phase of new models Investment programs at Mirafiori and Cassino plants will be part of future announcements Total investment to exceed 500mn for plant upgrade and refurbishing Plant to produce 2 new models (New Quattroporte and Ghibli, launching in H1 2013), leveraging on Group portfolio and technologies Investment of ~ 800mn for production of New Panda Production ramp-up ended H Implementation of highest WCM standards Best manufacturing quality standards within the Group Plant prized with Automotive Lean Production Award 2012 Investment program of 1+bn, including modifications to existing production processes to accommodate new modular Small Wide architecture Investment evenly split between Chrysler and Fiat Production of 2 brand-new vehicles beginning in 2014 for worldwide markets Fiat 500X, the latest addition to 500 family New Jeep SUV, brand s entrance into new market segment Total plant production capacity at run-rate based on 3 shifts (1.6k vehicles/day) February 7-8, 2013 Investor meetings in New York 25

26 Group financial targets (IFRS) E 2014E Volumes (units/mn) Revenues ( bn) Trading Profit ( bn) Trading Margin 4.5% 4.6%-4.9% 5.0%-5.3% EBITDA ( bn) EBITDA % ~9.3% ~10.3% ~11.0% Capex ( bn) Capex/D&A ratio February 7-8, 2013 Investor meetings in New York 26

27 Key considerations of plan implications on the balance sheet Capex increases vs leveraging convergence on common architectures and powertrain solutions Development of Maserati, Alfa Romeo and Jeep as global brands Product range extension and increased capacity in LATAM through Pernambuco project Upgraded product and powertrain plan for Chrysler, also due to US market growth Assumptions underlying the plan based on prudent Capex projections Opportunities for synergies in capital allocation, savings in tooling procurement and optimization of investments not fully reflected Brands and market opportunities drive Capex allocation between Fiat and Chrysler Strong liquidity positions for both Fiat and Chrysler will be maintained Group liquidity over 20% of revenues with Fiat ex-chrysler over 30%, the highest percentage among European OEM s Fiat excl. Chrysler targeting break-even operating cash-flow in 2013 and 2014, before financial charges and taxes Any purchase of VEBA s interest in Chrysler (beyond periodic exercise of call options) will be financed in a manner to preserve Fiat s existing liquidity position Different options for financial support from Chrysler available under current contractual terms Permitted restricted payments (including dividend payments) through application of contractual baskets Loans/advances between Chrysler and Fiat (subject to certain governance processes and contractual restrictions) February 7-8, 2013 Investor meetings in New York 27

28 Capex plan Focus on Fiat ex-chrysler Chrysler represents over 50% of Group Capex through plan period (more than covered by growing EBITDA) Fiat excl. Chrysler Capex increase over 2012 run-rate driven mainly by Pernambuco project Excluding Pernambuco, no significant change in Fiat spending rate For plant currently under construction in Pernambuco (Brazil), Fiat will receive financing for up to 85% of the total 2.3bn invested (~ 1.5bn in period). In addition, once production begins project will also benefit from tax incentives for a minimum period of 5 years CAPEX BANDWIDTH OVER PLAN PERIOD FOR FIAT EX-CHRYSLER ( BN) Min Max Min w/o Pernambuco 2012E 2013E 2014E Drivers for Capex allocation within the Group Who owns and manages production site Who manages commercial distribution and brand Chrysler investment in Fiat plants to be economically advantageous compared to its available alternatives February 7-8, 2013 Investor meetings in New York 28

29 Debt maturities profile & DCM access ( bn) Outstanding Dec. 31, 12 Fiat ex Chrysler Beyond 5.5 Bank Debt Capital Market Other Debt Total Cash Maturities Cash & Mktable Securities 2.0 Undrawn committed credit lines 11.1 Total Available Liquidity Fiat ex Chrysler Bank debt Committed lines maturing in 2012 fully refinanced, most in advance and with some additions More than 2/3 of remaining bank maturities through 2014 related to project loans with supra-national/development banks (mainly LATAM) and to operating needs in other non-eu countries: opportunities for renewals with new Capex plan Capital market New bond issuances totaling 2.5bn in 2012, covering redemptions through end of 2013 Prudent pre-funding on an opportunistic and diversified basis to continue Despite current rating Fiat continues to issue debt successfully with investment-grade documentation Other debt Mostly related to self-liquidating and automatically rolled-over positions related to dealer floor plan financing in Brazil Chrysler: no major maturities due prior to 2017 Note: Numbers may not add due to rounding; total cash maturities excluding accruals February 7-8, 2013 Investor meetings in New York 29

30 Some conclusions EMEA will continue to provide significant challenges for everyone for some years to come Fiat-Chrysler decision to shift product portfolio is the preferred choice because It is the best economic alternative Group has all necessary elements to execute (brands, architectures, powertrains, installed capacity and experienced workforce) Fiat and Chrysler are already operating as an integrated business, with controls in place to protect minority and respect credit agreements Fiat and Chrysler can manage financial requirements for implementation February 7-8, 2013 Investor meetings in New York 30

31 and responses in brief to Max s eight key questions Note: shaded questions already addressed in previous pages of this presentation January 31, 2013 Fiat Auto: Bringing It All Together In 2013: 8 Key Questions For Management Q1: What will you do it the court rules in favor of the VEBA's price? Q2: Can you clarify the obstacles (and opportunities) to pooling cash with Chrysler? Q3: How long can Fiat's liquidity last, absent a combination with Chrysler? Fiat excl. Chrysler has adequate liquidity levels to deal with operating needs, investment plans and any uncertainty in markets Q4: What are the downsides to a Ferrari IPO why not just do it? No need for the Group to monetize assets Q5: Did the government stop you closing capacity in Italy in 2012? How? No Q6: Are your Capex numbers at core Fiat serious? Q7: What is the maximum EBIT & FCF potential of Maserati if it goes to plan? Maserati potential is ~ 1bn EBITDA by middecade with EBITDA margin of ~20% Q8: What's Chrysler's bull case for 2015 EBIT and does the JPY:US$ worry you? U.S. GAAP operating profit for 2015 to continue strong positive trend off $4.8bn target for 2014 Japanese competitors performance in U.S. market is a function of multiple factors and FX rate is not a key concern ,095 1,691 1, ,598 1,724 1,557 1,122 1, ,007 1, Volumes sold in U.S. sourced from Japan ('000 units) JPY/USD Source: WardsAuto for vehicle volumes; Bloomberg for FX rates R 2 = ,399 1,589 February 7-8, 2013 Investor meetings in New York 31

32 Contacts GROUP INVESTOR RELATIONS TEAM Marco Auriemma Vice President Alexandra Deschner Timothy Krause Paolo Mosole Sara Nicola Maristella Borotto fax: websites: February 7-8, 2013 Investor meetings in New York 32