SUMMARY DOCUMENT. 659,025,826 ordinary shares. Fiat S.p.A., Turin, Italy

Transcription

1 SUMMARY DOCUMENT for the registration to trading on the Regulated Market (General Standard) of the Frankfurt Stock Exchange without prospectus pursuant to Section 4(2) No. 8 German Securities Prospectus Act (Wertpapierprospektgesetz, WpPG) of 659,025,826 ordinary shares of Fiat S.p.A., Turin, Italy 1

2 The following discussion is a summary document (the "Summary Document") which was prepared solely for the purpose of the registration of ordinary shares (the "Shares"), coming from 2003 and 2005 share capital increases, of Fiat S.p.A. ("the Company", and together with its direct and indirect subsidiaries - which include, beginning June 1, 2011, Chrysler Group LLC and its direct and indirect subsidiaries following the acquisition of control - "Fiat", "Fiat Group" or "Group") on the Regulated Market (General Standard) of the Frankfurt Stock Exchange, pursuant to Section 4(2) No. 8 of the German Securities Prospectus Act (Wertpapierprospektgesetz, "WpPG"). This Summary Document is not a "prospectus" within the meaning of Section 3(1) WpPG or Article 5(3) of Directive 2003/71/EC of the European Parliament and of the Council of November 4, 2003 (as amended, inter alia, by Directive 2010/73/EU, the "Prospectus Directive"). It merely summarizes key information pursuant to Section 5 para. 2a WpPG pertaining to the Company and the Shares as disclosed in publicly available financial documentation. This Summary Document should, therefore, be read only in conjunction with the newest prospectus and the publicly available financial information of the Company disclosed in compliance with the legal requirements of the applicable national and/or EU law which can be inspected at the office of the Company during normal business hours and are available on the Company's website at (together, the "Published Information"). In connection with the registration of the Shares on the Regulated Market (General Standard) of the Frankfurt Stock Exchange, no Shares will be offered to investors. This Summary Document contains forward-looking statements. These statements are based on the Company's current expectations and projections about future events and, by their nature, are subject to inherent risks and uncertainties. They relate to events and depend on circumstances that may or may not occur or exist in the future and, as such, undue reliance should not be placed on them. Actual results may differ materially from those expressed in such statements as a result of a variety of factors, including: volatility and deterioration of capital and financial markets, including further worsening of the Eurozone sovereign debt crisis, changes in commodity prices, changes in general economic conditions, economic growth and other changes in business conditions, weather, floods, earthquakes or other natural disasters, changes in government regulation (in each case, in Italy or abroad), production difficulties, including capacity and supply constraints and many other risks and uncertainties, most of which are outside of the Company s control. The forward-looking statements contained in this Summary Document speak only as of the date on which they are made. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement contained herein to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. This Summary Document contains references in the German language to foreign legal concepts which are originally expressed in the Italian language. Such concepts may be impossible to describe accurately and completely by means of the German translation of the words only, without more detailed comparative explanations. In addition, the German terminology may have a different meaning in the context of German law than the actual meaning of the relevant Italian expression. This Summary Document is made up of the disclosure requirements set out in Annex XXII of the Prospectus Directive Regulation (EC) No. 809/2004 (as last amended by the Commission Delegated Regulation (EU) No. 862/2012 as of June 4, 2012) for a summary of a prospectus in accordance with Article 5(2) of the Prospectus Directive, known as Elements. These elements are numbered in Sections A E (A.1 E.7). This Summary Document contains all the Elements required to be included in a summary for this type of securities and Issuer. Because some Elements are not required to be addressed, there may be gaps in the numbering sequence of the Elements. Even though an Element may be required to be inserted in a summary because of the type of securities and Issuer, it is possible that no relevant information can be given regarding the Element. In this case, a short description of the Element is included in this Summary Document with the mention of not applicable. 2

3 A Introduction and warnings A.1 Introduction and warnings. Fiat S.p.A. assumes responsibility for the content of this Summary Document pursuant to Section 5(2b) No. 4 WpPG. With regard to the content of this Summary Document, civil liability attaches to Fiat S.p.A., but only if this Summary Document is misleading, inaccurate or inconsistent when read together with the other parts of the Published Information. Any decision to invest in the Shares should be based on consideration of the Summary Document and the Published Information as a whole. Where a claim relating to the information contained in this Summary Document is brought before a court, the plaintiff investor might, under the national legislation of the Member State, have to bear the costs of translating the Summary Document before the legal proceedings are initiated. B Issuer and any guarantor B.1 Legal and commercial name. The Company's legal name is Fiat S.p.A. (Società per Azioni). The Company's commercial name is "Fiat". B.2 The domicile and legal form of the issuer, the legislation under which the issuer operates and its country of incorporation. The Company is a joint stock corporation incorporated under the laws of the Republic of Italy. The registered office of the Company is located at Via Nizza 250, Turin, Italy. B.3 Description of, and key factors relating to, the nature of the issuer s current operations and its principal activities, stating the main categories of products sold and/or services performed and identification of the principal markets in which the issuer competes. Following the demerger of its capital goods businesses to Fiat Industrial, effective 1 January 2011, and the increase in its stake in Chrysler (see B.7 Significant changes Demerger of activities to Fiat Industrial and Significant changes Acquisition of Chrysler ), Fiat has expanded and accelerated its integration with the Chrysler Group with the objective of creating a global automaker positioned as an industry leader. Fiat designs, produces and sells vehicles for the mass market as well as luxury and performance cars. The Group has increased its global reach through the acquisition of control of Chrysler Group in Fiat also operates in the components sector, through Magneti Marelli and Teksid, and in the production systems sector, through Comau. In 2011, Fiat has been carrying out activities in the automotive sector through companies located in 44 countries, 155 plants and 77 R&D centers located worldwide and has commercial relationships with customers in approximately 140 countries. The Fiat s mass-market car brands consist of Fiat Group Automobiles ("FGA") and Chrysler brands, in particular: Fiat Group Automobiles designs, produces and sells automobiles under the brands Fiat, Lancia, Alfa Romeo and Abarth, as well as light commercial vehicles ("LCVs") under the brand Fiat Professional. In addition, Fiat Group Automobiles offers, through FGA Capital a joint-venture with Credit Agricole and directly through its financial services companies financial services in Europe, Latin America and China. Chrysler, formed in 2009 to establish a global strategic alliance with Fiat, designs, produces and sells vehicles and automotive products under the brands Chrysler, Jeep, Dodge, Ram, Mopar, SRT and Fiat in more than 120 countries around the world. During the first nine months to September 2012, Fiat Group's mass-market brands shipped worldwide 3.125,000 vehicles, of which 1,572,000 (50.3%) in the NAFTA region, 712,000 (22.8%) in Latin America ( LATAM ), 77,000 (2.5%) in the Asia Pacific ( APAC ) and 764,000 (24.4%) in Europe, Middle East and Africa ("EMEA"). Luxury and Performance car brands. Fiat Group's luxury and performance cars are sold under the brands Ferrari and Maserati. 3

4 For the nine months to September 2012, Ferrari shipped a total of 5,267 street cars, a 6% increase over the corresponding period in The growth was primarily driven by 12-cylinder models (+22% year-overyear). North America maintained its position as Ferrari s primary market with 1,512 street cars shipped yearto-date, accounting for 29% of total shipments (+15% vs. 2011). Volumes were also higher in China, Hong Kong and Taiwan where a total of 566 vehicles were shipped (+7% vs. 2011), accounting for 11% of the global total. For the nine months to September 2012, Maserati shipped a total of 4,754 vehicles, a 2% increase over the prior year with growth in the U.S. (+18%), the Middle East (+57%) and China (+3%) more than offsetting a 37% decline in Europe. Fiat operates also in the Components and Production Systems businesses through Magneti Marelli (components), Teksid (metallurgical products) and Comau (production systems). Magneti Marelli is an international leader in the design and production of advanced automotive systems and components: from lighting to engine control systems, from electronic systems to suspensions and shock absorbers, from exhaust systems to components for the aftermarket and motorsport. Teksid is the world s largest producer of gray and nodular iron castings like engine blocks, cylinder heads, engine components, parts for transmissions, gearboxes and suspensions. Through Teksid Aluminum, it is also a world leader in production technologies for aluminum cylinder heads and engine components. Comau offers its customers worldwide body welding and assembly systems, and machining and assembly for mechanical systems, in addition to a wide range of industrial robots, offering maximum quality, reliability and flexibility. B.4a Description of the most significant recent trends affecting the issuer and the industries in which it operates. Challenges to the global economy The business development of the Fiat Group, its financial condition and results of operation have been materially affected by the significant rise in sovereign debt in the United States and by the acute sovereign debt crisis in the Eurozone. Beginning in 2008, global financial markets experienced severe disruptions, resulting in a material deterioration of the global economy. During the global economic recession in 2008 and 2009, which affected essentially all regions and all business sectors, substantially resulting at one point in a sharp decline in demand for automobiles. Although 2010 and 2011 showed signs of a global economic recovery, the overall global economic outlook remains uncertain. The uncertainty regarding Greece's future and the problems in the Spanish banking sector in particular have had an additional negative impact on market sentiment and confidence, particularly in the Eurozone. According to the IMF, the greatest risks to the global economic outlook relate to insufficient political measures to stem the debt crisis in the Eurozone. However, the lower pace of expansion is seen not only in countries referred to by the IMF as advanced economies but also in major emerging economies, such as China, Brazil and India. In addition to weaker export business, lower domestic demand also led to slowing demand in these countries. Having reviewed economic and trading conditions in the Group s four operating regions, Fiat confirms the expectations of performance in North America, Latin America and Asia-Pacific. Events of the past 12 months have reinforced our negative view of the development of the European markets. We see continuing weak trading conditions for the remainder of 2012 extending well into 2013 and at least part of As a result, the Group has refined earnings guidance for 2012 at the lower end of its original target range. Developments in the global automobile industry There has been a decline in volumes of automobiles sold in Europe, where difficult trading conditions continued in the nine months to September 2012 for both passenger cars and light commercial vehicles, particularly in Italy, as a result of the economic climate. The number of newly registered passenger cars in Europe in the nine months to September 2012 fell by 7% compared to In the nine months to September 2012, car market volumes grew in the other areas were the Group operates: U.S. retail sales increased by 15% to 11.1 million vehicles, Canadian market posted a 7% increase to 1.3 million units, in Brazil market was up 5% to 2.7 million units driven by government tax incentives, APAC markets increased by 14% overall. 4

5 Environmental Regulation Increasingly stringent consumption and emission standards throughout the industrial world, including in the EU, the United States and Japan, combined with oil price fluctuations and the resultant increases in fuel costs, have compelled automakers to accelerate the development of more fuel efficient technologies. On the consumer front, market demand for lower consumption vehicles has increased correspondingly. Fiat Group is among the automakers most strongly committed to reducing the environmental impacts of transportation. A comprehensive approach to sustainable mobility is what drives the Group s product strategy. A single solution does not exist for sustainable mobility. Instead, the company employs a combination of conventional and alternative technologies that take into consideration the different economic, geographic and fuel requirements of each market. Accordingly, Fiat Group targets its efforts at: optimizing the ecological performance of conventional engines; increasing the use of alternative fuels; developing non-conventional propulsion systems; designing systems to cut emissions; reducing vehicle energy demand; and engaging with and raising customer awareness. These strategic choices have delivered major results on the emissions and fuel economy front, particularly in Europe and the U.S., which represent approximately 60% of the Group s 2011 vehicle sales (which total more than four million shipments worldwide). For the 5 th year running Fiat is the leader for the lowest CO 2 emissions in Europe at g/km (source: JATO Dynamics 2011, the world s leading provider of automotive intelligence), reflecting a long-standing commitment to the environment. Alongside its work on improving traditional internal combustion engines and promoting the use of alternative fuels, the Group is also developing alternative propulsion systems, especially for vehicles used in a predominantly urban setting. Chrysler Group, with its expertise in hybrid and electric technologies, is the vehicle electrification center for the entire Group. Chrysler Group is developing technologies that can be used in a range of electrified vehicles, including conventional hybrids, plug-in hybrids, fully electrified and range-extended electric vehicles. In the U.S., for example, Chrysler is currently developing a fully-electrified version of the Fiat 500. The Group s commitment to reduce the environmental impact of its activities also extends beyond its products. In fact, the Group continued to develop and apply concrete and affordable solutions for reducing the environmental impact of production processes. In 2011, total CO2 emissions for Fiat and Chrysler plants were 10% below the 2010 level and water consumption was down 18.5%. Fiat's efforts to reduce the environmental footprint of its manufacturing activities have led to being recognized, in 2011, by the Carbon Disclosure Project as one of the world leaders in combating climate change. Fiat is also one of the few auto sector companies that has been recently confirmed (Sept 2012), for the 4 th consecutive year, in the Dow Jones Sustainability Indexes (DJSI) World and Europe, receiving a score of 91/100 compared with an overall average of 74/100 for companies in the Automobiles sector evaluated by SAM, the specialists in sustainability investing. 5

6 B.5 Description of the group and the issuer s position within the group. The Company is the parent company of the Fiat Group. Its primary role within the Group is to function as a finance and management holding company. The operating business is conducted by its subsidiaries. The following chart provides a simplified overview of the structure of Fiat Group and the Company's interests in some of its most significant subsidiaries as of the date of this Summary Document. B.6 Shareholder Structure On the basis of the notifications received by CONSOB and the Company and pursuant to the information provided by the respective shareholders, the following shareholders hold at least 3% of the Company s ordinary shares as of the date of this Summary Document: Ultimate Shareholder Direct Shareholder Percentage of voting rights (1) Giovanni Agnelli & C. Exor S.p.A % S.a.p.A.... Free float (2) % (1) Fiat S.p.A. currently holds 2.76% of its own ordinary shares. (2) All voting rights of shareholders whose shareholdings represent less than 3% of the total voting rights in Fiat S.p.A. are considered as free float. 6

7 B.7 Summary of the Consolidated Financial Information The following selected historical financial information of Fiat is based on the audited consolidated financial statements of Fiat as of and for the fiscal years ended December 31, 2011, 2010 and 2009 (referred to the Continuing Operations ; see B.7 Significant changes Demerger of activities to Fiat Industrial ), as well as the unaudited consolidated interim financial statements of Fiat as of and for the nine months to September 2012 (with comparative figures for the same period in 2011). The consolidated financial statements of Fiat as of and for the fiscal years ended December 31, 2011, 2010 and 2009, were prepared in accordance with International Financial Reporting Standards, as adopted by the European Union, ("IFRS") and audited by Deloitte & Touche S.p.A., Via Tortona 25, Milano, Italy. The unaudited consolidated interim financial statements of Fiat as of and for the nine months to September 2012 and 2011 were prepared in accordance with IFRS for interim financial reporting (IAS 34). Consolidated Income Statement of Fiat Group in millions For the year ended December 31, For the nine months ended September 30, 2009 (1) (2) 2011 (2) 2012 (unaudited) (unaudited) Net revenues 32,684 35,880 59,559 39,915 62,182 Cost of sales 28,252 30,718 50,704 33,866 52,949 Selling, general and administrative costs 2,673 2,956 5, ,961 Research and development costs 1,010 1,013 1,367 1,026 1,375 Other income (expenses) (13) (81) (49) (23) (70) Trading Profit (Loss) 736 1,112 2,392 1,627 2,827 Results from investments Share of the profit/(loss) of investees accounted for using the equity Method Other income (expenses) from investments 12 (6) (15) (14) 13 Gains (losses) on the disposal of investments (91) Restructuring costs (39) Other unusual income (expenses) (193) (14) 1,025 1,097 (80) Earnings before Interest and Taxes (EBIT) (3) (4) 455 1,106 3,467 2,707 2,770 Financial income (expenses) (352) (400) (1,282) (911) (1,237) Profit (Loss) before taxes ,185 1,796 1,533 Income taxes Profit (Loss) from continuing operations (345) 222 1,651 1,386 1,023 Post-tax profit/(loss) from Discontinued Operations (503) Profit/Loss (848) 600 1,651 1,386 1,023 Profit/Loss attributable to: Owners of the parent (838) 520 1,334 1, Non-controlling interests (1) (2) (3) (4) Amounts referred to the Continuing Operations (See B.7 Significant changes Demerger of activities to Fiat Industrial ). The amounts reported for 2011, include seven months of operations for Chrysler from June 1, Earnings before interest and tax (EBIT) net income without financing cost and taxes on income. The EBIT is not recognised as a measure under IFRS. Therefore, EBIT should be viewed as supplemental to, but not as substitute for, the balance sheet, statement of income or cash flow statement data determined in accordance with IFRS. Since not all companies define this measure in the same way, EBIT as shown in this Summary Document may not be comparable to similarly-titled measures used by other companies. The Company defines EBIT as Trading profit/(loss) plus Result from investments plus other income/(expense) classified as unusual. Beginning 2012, Fiat Group started assessing performance on the basis of EBIT and has decided to report it as a separate line item in the Income statement in place of the line item "Operating profit (loss)". 7

8 2010 compared with 2009 a Net revenues for 2010 totaled 35,880 million, a 9.8% increase over 2009 when overall trading conditions were particularly weak. The following review provides an analysis of net revenues and trading profit by segments. Net revenues in million Fiat Group Automobiles 26,293 27,860 Maserati Ferrari 1,778 1,919 Fiat Powertrain 3,372 4,211 Magneti Marelli (Components) 4,528 5,402 Teksid (Metallurgical Products) Comau (Production Systems) 728 1,023 Other Business and Eliminations (5,041) (5,897) Total 32,684 35,880 Fiat Group Automobiles (FGA) posted revenues of 27,860 million for the year, representing a 6% increase over 2009 (+0.5% at constant exchange rates), with the impact of the decline in passenger car volumes (-8.2%) compensated for by the significant increase for light commercial vehicles (+27.1%). In total, FGA delivered 2,081,800 passenger cars and light commercial vehicles, down 3.2% over the prior year. For passenger cars only, FGA delivered 1,691,400 vehicles, an 8.2% decrease over In Europe, deliveries were down 15.1% to 963,000 vehicles, with the reduction also reflecting measures to realign dealer inventory levels to market demand. Deliveries in Italy (-16.3%) and Germany (-53.2%) were heavily impacted by the significant decline in demand for smaller and CNG/LPG vehicles, following the phase-out of eco-incentives. Deliveries were also down in the United Kingdom (-17.5%), but remained stable in France (+0.9%) and were up in Spain (+48.3%), against particularly low 2009 volumes. Notable results were achieved in several of the sector's smaller markets. In Europe, where the passenger vehicle market was down 4.9% over the prior year, Fiat Group Automobiles closed 2010 with a market share of 7.5% (-1.1 percentage points over 2009). In Italy, share was 30.1%, a decrease of 2.7 percentage points. Excluding the effect of the sharp reduction in demand for CNG/LPG vehicles (-25%), where FGA is market leader, share would have been in line with At 3.0% (-1.7 percentage points), share performance in Germany was impacted by the significant decline in demand (over 40%) in FGA's core market segments. Modest decreases in share were experienced in France (-0.3 percentage points to 4.0%) and the United Kingdom (-0.5 percentage points to 3.0%). By contrast, market share in Spain was up 0.5 percentage points to 3.0%. For light commercial vehicles, a total of 390,400 units were delivered, representing a 27.1% year-on-year increase. In Europe, Fiat Professional increased deliveries 19.7% to 183,300 units. In Italy, Fiat Professional achieved a 44.0% market share, gaining approximately 3 percentage points over 2009, while share in Europe was 12.8% (stable vs. 2009). In Brazil, Fiat Group Automobiles maintained its leadership position, delivering a total of 761,400 passenger cars and light commercial vehicles, representing a year-on-year increase of 1.6%. With the overall market growing 10.6%, FGA achieved a 22.8% share for the year (-1.7 percentage points). For 2010, Maserati reported 586 million in revenues, an increase of 30.8% over 2009, primarily attributable to excellent sales performance for the new GranCabrio. A total of 5,675 cars were delivered to the network during the year, an increase of 26.4%, with positive performance in the majority of Maserati's 59 national markets. For 2010, Ferrari reported 1,919 million in revenues, up 7.9% over 2009, mainly reflecting higher sales volumes driven by the new 458 Italia and 599 GTO, the continued success of the Ferrari California, as well as the positive contribution from the customization program. A total of 6,573 cars were delivered to the network during the year (+5.4% over 2009). For 2010, Fiat Powertrain (the Passenger and Commercial Vehicles business line of the former FPT Powertrain Technologies sector) reported 4,211 million in revenues, an increase of 24.9% over the previous year. This includes the effect of full consolidation of Fiat Powertrain Polska Sp. z.o.o. (formerly Fiat-GM Powertrain a The financial review for the year ended at December 31, 2009, 2010 and 2011 reflects the organizational structure adopted by Fiat Group until In particular: the Automobiles business, (FGA, Maserati, Ferrari and Chrysler), the Components and Production Systems (Magneti Marelli, Fiat Powertrain, Teksid and Comau) and Other Businesses (Publishing, Holding Companies and Other). 8

9 Polska) following acquisition of the JV partner's 50% stake during the year. On a like-for-like basis, the increase in revenues was 11.1%. Sales to Fiat Group companies accounted for 87% of revenues (90% on a comparable scope of operations and 92% for 2009), with the remainder primarily consisting of diesel engines sold to external customers. A total of 2,347,000 engines (+2.5% on a like-for-like basis) and 2,233,000 transmissions (+1.1%) were sold during the year. Magneti Marelli reported 2010 revenues of 5,402 million, representing a 19.3% increase over For Europe overall, the increase reflected strong performance for light commercial vehicles and recovery in the medium-large passenger car segments, which were particularly hard hit in In Italy and Poland, revenues reflected the overall decline for A and B-segment cars following the elimination of government eco-incentives. The sector experienced strong performance in both China and Brazil and a significant recovery in the NAFTA region where volume growth was primarily driven by new product launches. All business lines recorded an increase in production volumes. The Lighting business achieved significant growth linked to the recovery of its core European markets and volume increases in Asian markets and the NAFTA region. The Suspension Systems business also saw a strong recovery, with volume increases primarily concentrated in Brazil and the USA. Sales for Electronic Systems were up in China and Brazil, and the Engine Control business also benefited significantly from performance in those markets. Teksid reported revenues of 776 million for 2010, up 34.3% principally due to an increase over 2009 volumes, which were severely impacted by the market crisis. The Cast Iron business unit recorded a 21.8% increase in volumes, driven primarily by growth in components for heavy vehicles, with positive performance in the Mercosur and NAFTA regions, as well as in Europe. Volumes for the Aluminum business unit were up 15.3%. Comau had revenues of 1,023 million for 2010, with the 40.5% increase over 2009 principally attributable to operations in China, Latin America and North America. Fiat Group posted 2010 trading profit of 1,112 million (trading margin: 3.1%), compared with 736 million for 2009 (trading margin: 2.3%). Trading profit/(loss) in million Fiat Group Automobiles Maserati Ferrari Fiat Powertrain Magneti Marelli (Components) Teksid (Metallurgical Products) (12) 17 Comau (Production Systems) (28) (6) Other Business and Eliminations (72) (71) Total 736 1,112 Fiat Group Automobiles recorded a 607 million trading profit for 2010 (trading margin of 2.2%), compared to the 470 million figure for 2009 (1.8% margin). The improved trading performance was attributable to a better product/market mix, linked to the performance of light commercial vehicles and the Brazilian business, in addition to continued improvements from World Class Manufacturing and purchasing efficiencies. For 2010, Maserati had a trading profit of 24 million (trading margin: 4.1%). The sharp increase over the 11 million trading profit for 2009 (trading margin: 2.5%) was attributable to both higher sales volumes and continued optimization of operating costs. Ferrari closed 2010 with a trading profit of 303 million (trading margin: 15.8%), compared to 238 million for 2009 (trading margin: 13.4%). The increase was attributable to higher sales volumes, excellent results from the customization program and efficiency gains. Fiat Powertrain closed 2010 with a trading profit of 140 million, compared to 104 million for This improvement was primarily attributable to a more favorable sales mix and increased purchasing and manufacturing efficiencies. Magneti Marelli reported trading profit of 98 million for 2010 compared with 25 million for The improvement in trading performance was driven by increased sales volumes, combined with cost containment actions and manufacturing efficiencies. However, the sector had to manage the unfavorable impact of supply issues resulting from an excess in market demand for electronic systems. Teksid closed the year with a trading profit of 17 million (trading loss of 12 million for 2009), reflecting the positive impact of volume increases. Comau reduced its trading loss to 6 million for 2010, compared with a trading loss of 28 million for The improvement was attributable to the increase in activity levels and cost containment actions. 9

10 For 2010, Fiat Group (Continuing Operations) EBIT was 1,106 million ( 455 million for 2009): the increase reflected the improvement in trading profit (+ 376 million), a reduction in net unusual expense ( 120 million for 2010 compared with a 358 million charge for 2009) and higher results from investments (+ 37 million). Restructuring costs for Fiat Group (Continuing Operations) were 118 million primarily related to Fiat Group Automobiles ( 90 million) and Magneti Marelli ( 26 million), compared to a total of 168 million for 2009, principally attributable to Magneti Marelli ( 62 million), Fiat Group Automobiles ( 54 million) and Fiat Powertrain ( 21 million). Fiat Group (Continuing Operations) reported other unusual expense of 14 million compared with 193 million for 2009 that included write-downs by the Automobiles business of certain investments in platforms and architectures related to the strategic realignment with Chrysler Group LLC, costs related to the acquisition of the interest in Chrysler Group LLC, in addition to other non-recurring expenses and impairment losses recognized as a consequence of the global economic crisis. Net financial expense for the Fiat Group (Continuing Operations) totaled 400 million in 2010 ( 352 million for 2009) with the increase primarily due to the cost of maintaining a higher level of liquidity and included a 111 million gain in the mark-to-market value of two stock option-related equity swaps (a 117 million gain for 2009). Fiat Group (Continuing Operations) recorded profit before taxes of 706 million (profit before taxes of 103 million for 2009) and reflected the higher EBIT (+ 651 million), partially offset by a 48 million increase in net financial expense. Income taxes for 2010 for Fiat Group (Continuing Operations) totaled 484 million ( 448 million for 2009), mainly relating to the taxable income of companies operating outside Italy. For 2010, Fiat Group recorded a profit of 600 million (loss of 848 million for 2009), 222 million for Continuing Operations (loss of 345 million for 2009). Profit attributable to owners of the parent for 2010 was 520 million (loss of 838 million for 2009), 179 million for Continuing Operations (loss of 374 million for 2009) compared with 2010 b Net revenues for the Group for 2011 totaled 59.6 billion. Net revenues in million Fiat Group Automobiles 27,860 27,980 Chrysler - 23,609 Maserati Ferrari 1,919 2,251 Fiat Powertrain 4,211 4,450 Magneti Marelli (Components) 5,402 5,860 Teksid (Metallurgical Products) Comau (Production Systems) 1,023 1,402 Other Business and Eliminations (5,897) (7,503) Total 35,880 59,559 Fiat Group Automobiles (FGA) posted revenues of 27,980 million for the year, substantially unchanged over 2010, with a decline in volumes being offset by a more favorable product mix. FGA shipped c 2,032,900 passengers cars and light commercial vehicles (LCV), down 2.4% over the prior year, with the decline in passenger car volumes being partially offset by an increase for LCVs. In Europe, the passenger car market was down 1.4% overall to approximately 13.6 million vehicles for the year, with performance uneven across markets. Demand in Germany was up 8.8% for the year, while in Italy it was down a further 10.9%, following a 9.2% decline in 2010, to 1.75 million units (the lowest level since 1996). Declines were also recorded in Spain (-17.7%) and the UK (-4.4%). In France, the market was down 2.1% for the year and contracted 8.6% in the fourth quarter. For other markets, demand was up in the Netherlands, b The financial review for the year ended at December 31, 2009, 2010 and 2011 reflects the organizational structure adopted by Fiat Group until In particular: the Automobiles business (FGA, Maserati, Ferrari and Chrysler), the Components and Production Systems (Magneti Marelli, Fiat Powertrain, Teksid and Comau) and Other Businesses (Publishing, Holding Companies and Other). c Shipments: new cars & LCVs invoiced to external customers (i.e., dealer network, importers and other customers such as rental companies, corporate fleets, government agencies and local authorities, etc.). 10

11 Switzerland, Austria and Belgium, but down sharply in both Greece and Portugal. For passenger cars only, FGA shipped 1,612,900 vehicles, a 4.6% decrease over In Europe, shipments were down 10.7% to 860,000 units due to an unfavorable market and segment mix. The significant volume increase in Germany (+7.2%) only partially offset reductions in the other major markets (Italy -12.4%, France -15.8%, the UK -1.9% and Spain -21.6%), although gains were achieved in several of FGA s smaller markets. In terms of market share in Europe, FGA recorded a 6.9% share for the year, a 0.8 percentage point decrease primarily attributable to the reduced weight of the Italian market and a shift in demand towards larger vehicle segments. The contraction in demand in the A and B segments in particular (-15% and -9%, respectively, compared to a 1.4% decline for the market overall) accounted for a 0.6 p.p. decrease in share. In addition, 2011 saw a 73% reduction in demand for CNG and LPG vehicles in Italy, where FGA is market leader, following on from an already significant decline in In Italy, FGA s share was 29.4%, down 0.9 p.p. for the year primarily as a result of a 2.3 p.p. loss in Q compared to Q1 2010, which benefited from the tail of eco-incentives notwithstanding significant share increases in its three main market segments. There were modest declines in the other major European markets, with Germany down 0.1 p.p. to 3.1%, France -0.4 p.p. to 3.6%, the UK -0.2 p.p. to 3.0% and Spain -0.2 p.p. to 3.1%. Elsewhere in Europe, notable performance was achieved in the Netherlands, which, with approximately 37,000 vehicles sold and a share of 6.7%, has become FGA s fifth largest market in Europe. For LCVs, demand in Europe was 7.6% higher for the year at nearly 1,800,000 units. In the major markets, demand was uneven with double-digit growth in Germany (+15.3%) and the UK (+15.3%), a more modest increase in France (+3.4%), but declines in both Italy (-4.7%) and Spain (-10.3%). Throughout the rest of Europe, demand was 12.6% higher for the year. FGA shipped a total of 420,000 LCVs, representing a 7.6% increase over For Europe, 223,700 vehicles were shipped, representing a 10.5% increase over In terms of market share, Fiat Professional achieved a 0.4 p.p. gain in Italy to 44.4%. For Europe, share of the LCV market remained essentially stable at 12.5% (excluding Italy, share was up 0.2 p.p. to 9.0%). The primary contribution came from the Ducato which recorded a 13.5% increase in sales over the prior year to 110,000 vehicles and the best ever share in its segment. In Brazil, demand for passenger cars and LCVs rose 2.9% to over 3.4 million units. The passenger car market was in line with the prior year, while demand for LCVs was up 13.0%. FGA shipped a total of 772,700 passenger cars and LCVs, representing a 1.5% increase over 2010 and an alltime annual record. Including Chrysler Group brands, overall share in Brazil was 22.2% (+1.8 p.p. over the nearest competitor). Fiat brand retained its leadership for the 10th consecutive year, while maintaining pricing discipline in an increasingly competitive market. In Argentina, where overall demand was approximately 29% higher, FGA increased sales by around 34% to 88,000 units, with share up 0.4 p.p. to 10.8%. Chrysler posted revenues for the 7 months from June-December of 23,609 million (USD 32.9 billion) on worldwide shipments of 1,190,000 vehicles, of which the U.S. and Canada accounted for 82%. For the full year, worldwide vehicle shipments totaled 2,011,000 (up 26% over 2010) with 72% shipped in the U.S., 12% in Canada and 16% in other regions. Vehicle sales d were up 26% for the full year in the U.S. and 13% in Canada. Share increased 1.3 p.p. over the prior year in both markets, coming in at 10.5% and 14.3%, respectively. Maserati closed 2011 with total shipments up 8.5% to 6,159 vehicles, generating revenues of 588 million. The U.S. remained Maserati s no. 1 market, with shipments up 20% over the prior year to 2,437 vehicles. With a total of 842 shipments for the year, China became the brand s second largest market worldwide. Ferrari reported 2011 revenues of 2,251 million, up 17.3% over 2010 on the strength of higher volumes and the contribution from the personalization program. A total of 7,195 vehicles were shipped during the year, representing a 9.5% increase over 2010 and an all-time record for the brand. Magneti Marelli reported revenues of 5,860 million for 2011, representing an 8.5% increase over the prior year, driven by strong performance in Germany, Brazil and China, in addition to a recovery in North America. There was also a positive impact from demand in the LCV segment. The Lighting business posted an increase in revenues of approximately 14% over 2010, primarily due to strong demand in the German market, in addition to a recovery in the NAFTA region, Brazil and Russia. For the Electronic Systems business, growth in both China and Europe drove revenues 16% higher for the year. Revenues for the Engine Controls business were substantially unchanged over the prior year, with an increase in volumes for Gasoline Direct Injection applications for external customers in Europe, offset by declines in both Brazil and the U.S. Fiat Powertrain reported 2011 revenues of 4,450 million, an increase of 5.7% over the prior year. Sales to Fiat d Sales represents sales to end customers as reported by Chrysler dealer network 11

12 companies accounted for 86% of revenues (87% in 2010), with the remainder consisting principally of diesel engines sold to external customers. A total of 2,352,000 engines (+0.2%) and 2,278,000 transmissions (+2.0%) were sold during the year. Teksid had revenues of 922 million for 2011, up 18.8% over the prior year, mainly due to higher volumes. The Cast Iron business unit recorded a 14.3% increase in volumes, driven by production of components for heavy vehicles, with positive performance in the Mercosur and NAFTA regions, as well as in Europe. Volumes for the Aluminum business unit were down 8.0%. Comau reported revenues of 1,402 million for 2011, a 37% increase over All business lines recorded increases, with the Body Welding, Powertrain Systems and Robotics operations and activities in China, in particular, making a significant contribution. Trading profit for 2011 totaled 2,392 million, with trading margin at 4.0%. Excluding Chrysler, trading profit was 1,047 million ( 1,112 million for 2010), with trading margin at 2.8% (3.1% for 2010). Trading profit/(loss) in million Fiat Group Automobiles Chrysler - 1,345 Maserati Ferrari Fiat Powertrain Magneti Marelli (Components) Teksid (Metallurgical Products) Comau (Production Systems) (6) 10 Other Business and Eliminations (71) (83) Total 1,112 2,392 Fiat Group Automobiles closed the year with a trading profit of 430 million (1.5% trading margin), compared with 607 million (2.2% margin) for Efficiencies in purchasing and World Class Manufacturing only partially offset volume declines for passenger cars in Europe, in addition to an increase in advertising costs related to new model launches and higher R&D expenditure for future products. Chrysler reported trading profit of 1,345 million for the period June-December, driven by a continued positive trend in volume, mix and pricing for new vehicles in both the U.S. and Canada. Trading margin benefited from a low amortization charge for R&D, as current spending relates to products still in development. Maserati posted a trading profit of 40 million for 2011 (6.8% trading margin), a significant increase over 2010 ( 24 million, 4.1% trading margin) attributable to an improved mix and further optimization of operating costs. Ferrari closed 2011 with a trading profit of 312 million (13.9% trading margin), compared to 303 million for The increase was attributable to higher sales volumes and a more favorable product mix, partially offset by higher R&D expenditure. Magneti Marelli posted a trading profit of 181 million for 2011, compared to 98 million for the previous year. The improvement was driven by higher sales volumes and manufacturing efficiencies, which more than compensated for cost pressures from higher materials prices. Fiat Powertrain closed 2011 with a trading profit of 131 million, compared to 140 million for The reduction was principally attributable to an increase in raw material costs and in costs associated with new products. Both of these factors were only partially compensated by overhead and manufacturing efficiencies. Teksid closed the year with a trading profit of 26 million, compared to 17 million for 2010, reflecting the positive trend in volumes. Comau reported a trading profit of 10 million for 2011, compared with a trading loss of 6 million for EBIT for 2011 was 3,467 million, including positive net unusuals of 944 million and results from investments for 131 million. For Fiat excluding Chrysler, EBIT was 2,266 million ( 1,106 million for 2010) including net unusual income of 1,089 million and results from investments for 130 million. Restructuring costs for 2011 totaled 102 million, compared to 118 million for 2010, and mainly related to Fiat Group Automobiles ( 78 million for 2011; 90 million for 2010) and Magneti Marelli ( 16 million for 2011; 26 million for 2010). Fiat Group reported other unusual income (net) of 1,025 million for Unusual income totaled 2,100 million, of which 2,017 million related to the fair value re-measurement of the 30% ownership interest held in Chrysler prior to the acquisition of control and of the right to receive an additional 5% ownership interest following achievement by Chrysler of the third Performance Event (which occurred in early January 2012). 12

13 Unusual expense totaled 1,075 million, of which 855 million ex-chrysler was largely attributable to the impact on Fiat s businesses of the strategic realignment with Chrysler s manufacturing and commercial activities, further accelerated following the increase of Fiat s ownership interest, and to one-off charges mainly related to the realignment of certain minor activities of the Group. Chrysler s June-December 2011 EBIT of 1,201 million includes 220 million in unusual expense recognized in relation to an upward revaluation of its inventories associated with the recognition of assets acquired and liabilities assumed at fair value at the date of acquisition of control. Due to rapid inventory turnover, this amount was fully written off (as a one-off non-cash charge) in June. Income from investments totaled 131 million (of which 1 million relating to Chrysler), up from 114 million for The figure primarily relates to the Group s share of the profit or loss of investees recognized using the equity method ( 146 million in 2011 vs. 120 million in 2010), broken down by sector as follows: Fiat Group Automobiles 146 million ( 131 million in 2010), Magneti Marelli - 18 million (- 5 million in 2010), other sectors 3 million (- 12 million in 2010). Net financial expense for 2011 totaled 1,282 million. Excluding Chrysler, net financial expense was 796 million ( 400 million in 2010). Net of the result from the marking-to-market of the two Fiat stock option-related equity swaps ( 108 million loss for 2011, compared to 111 million gain for 2010), net financial expense for Fiat excluding Chrysler increased by 177 million over the prior year (from 511 to 688 million), reflecting higher cost of carry in 2011 and a non-recurring gain in Profit before taxes was 2,185 million. Excluding Chrysler, profit before taxes was 1,470 million ( 706 million for 2010). The 764 million increase mainly reflected a 1,209 million positive difference in net unusual items, which was partially offset by higher net financial expense. Income taxes for 2011 totaled 534 million. Excluding Chrysler, income taxes were 464 million ( 484 million for 2010) and related primarily to taxable income of companies operating outside Italy and employment-related taxes in Italy. Net profit for 2011 was 1,651 million ( 222 million for 2010). Excluding Chrysler, unusuals and the mark-tomarket of the two Fiat stock option-related equity swaps, the net result was break-even, compared with a profit of 231 million for Profit attributable to owners of the parent was 1,334 million ( 378 million for 2010). Nine months to September 2012 compared to nine months to September 2011 e Group revenues were 62.2 billion for the nine months to September. Excluding Chrysler, revenues totaled 26.4 billion, a 6% decrease over the same period in 2011, mainly reflecting volume declines in Europe. Luxury and Performance brands increased revenues by 8% to 2.1 billion. Components were down 1% to 6.0 billion. Trading profit was 2,827 million. Excluding Chrysler, trading profit was 243 million compared to 921 million in the same period of For Luxury and Performance brands, trading profit increased 10% to 264 million, while Components reported a 25% decrease to 122 million. EBIT was 2,770 million. Excluding Chrysler, EBIT was 175 million (compared to 2,215 for 2011); net of unusuals, EBIT totaled 319 million. Net financial expense totaled 1,237 million. Excluding Chrysler, net financial expense was 612 million, compared to 632 million for the same period in Net of the impact of the mark-to-market of the Fiat stock option-related equity swaps (a 30 million gain for the nine months to September 2012 and a 115 million loss for the same period in 2011), net financial expense increased by 125 million mainly reflecting higher debt levels. Profit before taxes was 1,533 million. Excluding Chrysler, there was a 437 million loss compared to a 1,583 million profit in Net of unusuals, the loss was 293 million in 2012, compared to a profit of 362 million for the same period in 2011; the 655 million difference over the nine months to September 2011 mainly reflects the 678 million decrease in trading profit. Income taxes totaled 510 million. Excluding Chrysler, income taxes were 363 million and related primarily to the taxable income of companies operating outside Europe and employment-related taxes in Italy. Net profit was 1,023 million for the nine months to September. Profit attributable to the owners of the parent totaled 246 million. Excluding Chrysler, there was an 800 million loss, compared to a 1,207 million profit for 2011; excluding unusuals, the loss was 656 million, compared to a 37 million loss for the nine months to e See B.7 ( Significant changes Changes in Fiat s organisation and new segment information ). 13

14 September Consolidated Statement of Financial Position of Fiat Group As of As of December 31, September 30, in millions 2009 (1) 2010 (2) 2011 (3) 2012 (unaudited) Assets Intangible assets 7,199 4,350 18,200 19,123 Property, plant and equipment 12,945 9,601 20,785 21,772 Investments and other financial assets 2,159 1,653 2, Leased assets Defined benefit plan assets Deferred tax assets 2,580 1,678 1,690 1,671 Total Non-current assets 25,484 17,302 43,477 44,961 Inventories 8,748 4,443 9,123 10,009 Trade receivables 3,649 2,259 2,625 3,009 Receivables from financing activities 12,695 2,866 3,968 3,469 Financial receivables from Discontinued Operations 5,626 Current tax receivables Other current assets 2,778 1,528 2,088 2,231 Current financial assets Cash and cash equivalents 12,226 11,967 17,526 16,851 Total Current assets 41,669 29,777 36,488 36,664 Assets held for sale and Discontinued Operations 82 34, Elimination of financial receivables and debt due from/payable to Discontinued Operations (8,491) TOTAL ASSETS 67,235 73,442 80,031 81,685 Total assets adjusted for asset-backed financing transactions 60,149 64,588 79,321 81,405 14