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Fiat Chrysler (FCAU) Likely to Collaborate for Pickup Trucks

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Fiat Chrysler Automobiles N.V. (FCAU - Free Report) is open to collaborations for developing midsized pickup trucks, per Reuters. Adding new pickup models in the portfolio will aid Fiat Chrysler to expand its presence in markets outside the United States. The company wants to develop the new pickup truck for markets like Latin America. If this materializes, Fiat Chrysler’s new pickup will give tough competition to other market-specific models offered by its peers.

The company’s management agrees on the lack of affordable and lower-cost truck models in its portfolio that can cater to commercial uses of markets outside the United States. Fiat Chrysler is delving on probable options if it moves ahead on its own or takes aid from other companies.

In last November, the company unveiled the one-ton, mid-size Jeep Gladiator, which will be available in markets by 2022. Although ideal for the U.S. market, the vehicle is more of a lifestyle truck that doesn’t match the requirement of developing markets for work-oriented pickup trucks.

Fiat Chrysler Automobiles N.V. Price and Consensus


In the U.S. truck market, Fiat Chrysler is one of the key players, with its Ram brand. The brand created a new sales record by selling 597,368 vehicles in 2018 while the brand’s popular full-size truck Ram 1500’s sales were up 15% year over year to 377,286 vehicles.

In 2018, Fiat Chrysler capped in stellar performances as its vehicle sales climbed 9% year over year to 2,235,204 vehicles in the United States. The rise in sales was majorly driven by its Ram and Jeep brands, beside the company’s efforts of re-aligning its production in the region. Last year, this Jeep brand’s sales moved up 17% to 973,227 vehicles. In the current year, Fiat Chrysler projects to continue its winning streak on the back of expanding product portfolio.

Softened economic conditions in China and rising tariff-related costs compelled Fiat Chrysler to lower financial guidance for 2018 in July 2018. For 2018, it expects net revenues of 115-118 billion euros and adjusted EBIT is expected to be 7.5-8.0 billion euros. The company is slated to report earnings for fourth-quarter and 2018 on Feb 7.

Price Performance

Over the past three months, shares of Fiat Chrysler’s have gained 2.3% compared with the industry’s increase of 4.3%.


Zacks Rank & Stocks to Consider

Fiat Chrysler currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader auto sector are Bridgestone Corporation (BRDCY - Free Report) , Dana Incorporated (DAN - Free Report) and Magna International Inc. (MGA - Free Report) , each currently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Bridgestone has an expected long-term growth rate of 4.7%. Share price of the company has increased 1% in the past three months.

Dana has an expected long-term growth rate of 2.9%. Over the past month, shares of the company have gained 20.1%.

Magna has an expected long-term growth rate of 8.5%. Shares of the company have gained 2.5% in the past three months.

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