Car giant Fiat Chrysler reports second-quarter loss for 2020

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Car giant Fiat Chrysler reports second-quarter loss for 2020

Fiat Chrysler became another company to suffer from the effects of the pandemic. The automobile maker suffered a loss of about $1.24 billion (or a little over a billion Euros) for the April-June quarter in 2020. The company’s downward spiral comes on the back of various of its plants closing down this quarter thanks to the pandemic.

Fiat Chrysler's reports second-quarter loss in 2020

In a broader context, the automaker’s loss comes to about ¢77 (¢65 in Euros) and a total loss of revenue of about $13.8 billion (or about 11.7 billion Euros).

Staggering as these numbers are, they are still lower than analysts’ expectations, CNBC reported. In other terms, the company’s projected loss was pegged at around $1.36 (or a little over one Euro) with its revenue loss projected at about $17.5 billion (or around €14.7 billion).

The company’s operations in North America, however, were profitable for this quarter. Chrysler reported profits of over $49 million. Despite these losses, Chrysler’s Chief Executive Officer (CEO) Mike Manley said that the company’s focus remained on ensuring health and welfare, of its employees.

“Our second quarter showed that decisive actions and extraordinary contributions from our workforce enabled FCA to contain the impact of the COVID-19 crisis. While the company remains vigilant about the health and safety of employees, our plants are up and running, dealers are selling in showrooms and online, and we have the flexibility and financial strength to push ahead with our plans,” Manley said in his press release.

The company is also expecting some economic assistance from the Italian government to tide over during these troubling times. In total, the Italian government had said in June that it would lend the carmaker $7.5 billion (or €6.3 billion).

Of this amount, the company is still yet to use around $5.3 billion (€4.5 billion). In terms of numbers, the Italian-American car company’s sales were down by around 63 per cent (424,000 cars) for the three months from April to June.

While these are short-term hiccups for the company, the first quarter of 2021 is expected to bring a newer business tie-up for Fiat Chrysler. If regulatory approvals are met with, it is looking to enter into an equal share merger with French car company PSA Group.