Chrysler 2007 Annual Report Download - page 81

Report on Operations FPT Powertrain Technologies
following up on an agreement signed in late 2006. This long-
term joint venture, in which FPT holds a 30% interest, will
manufacture and market medium and heavy diesel engines.
Plans call for the production of three engine families: the F32,
4 and 6 cylinder versions of the NEF engine, and the Cursor 9.
As part of the joint venture agreement between Fiat Group
Automobiles and Tata Motors, the Sector will produce 1.3 litre
Multijet diesel engines, 1.2 litre and 1.4 litre Fire spark ignition
engines and transmissions at the joint venture’s plant in
Ranjangaon, India.
In December, FPT inaugurated its Chinese research and
development centre near Shanghai. The new facility will
concentrate on diesel and spark ignition engines and on
transmissions, and is yet another step towards FPT’s goal of
establishing an R&D presence in major market areas
worldwide.
In April, FPT entered into a strategic partnership with the
Sunseeker Group, one of the UK’s best known names in
nautical sports, whereby the Sector will supply turbocharged
diesel engines for the Sunseeker Challenger: the boat in which
the British group’s racing team will be vying for the UIM
Powerboat P1 World Championship title. At the Bologna Motor
Show, FPT Powertrain Technologies and the Italian motor
sports authority Federazione Italiana ACI CSAI announced an
agreement for the supply of 420F3 engines. Through this
agreement, FPT will be the sole supplier to the Italian Formula
3 Championships for the forthcoming racing seasons.
Operating Performance
FPT Powertrain Technologies operates through two product
lines: Passenger & Commercial Vehicles (P&CV), which
produces engines and transmissions for cars and light
commercial vehicles, and Industrial & Marine (I&M), which
produces powertrains for commercial vehicles, industrial
applications, construction machinery and agricultural
equipment, as well as marine engines. FPT also comprises the
Powertrain Research and Technology activities of CRF, and
coordinates engine and transmission research work by Elasis.
In 2007, the Sector’s revenues grew by 15.1% over the previous
year, propelled by rising demand from its major customers,
Fiat Group Automobiles and Iveco in particular. Part of FPT’s
output is earmarked for other Group companies, while sales to
third parties and joint ventures represented 24% of revenues in
2007, down from 26% in 2006, though volumes rose by 3%.
In 2007, the Passenger & Commercial Vehicles product line sold
2,597,000 engines and 2,093,000 transmissions, an increase of
11.5% and 23.5% respectively over the previous year. Diesel
engine sales to third parties accounted for approximately 20%
of the year’s total volumes.
Engine sales by the Industrial & Marine product line reached
505,000 units as against 444,000 in the previous year, an
increase of 13.9%. Engine deliveries were made chiefly to Iveco
(45%), CNH (19%), and Sevel (26%), the joint venture that
produces light commercial vehicles. In addition, the P&CV
product line sold 123,000 transmissions (+8.4%) and 300,000
axles (+14.4% over the previous year).
During the year, FPT Powertrain Technologies entered into
several new agreements with international partners, and
continued to implement the agreements signed in the past.
In June, FPT and the Daimler Truck Group signed a strategic
cooperation agreement in the field of powertrains. Under the
terms of this agreement, FPT will supply the Mitsubishi Fuso
Bus & Truck Corporation with around 80,000 F1C 3.0 litre
common rail diesel engines a year for eight years, starting in
2009. These engines will be used on a light commercial vehicle
marketed in major markets, including Europe and Japan.
Also in June 2007, SAIC Fiat Powertrain Hongyan Co. Ltd, the
joint venture with Iveco and SAIC, was established in China,
FPT Powertrain Technologies
80
Highlights
(in millions of euros) 2007 2006
Net revenues 7,075 6,145
Trading profit 271 168
Operating result (*) 257 102
Investments in tangible and intangible assets 365 254
- of which capitalised R&D costs 38 50
Total R&D expenses (**) 70 74
Employees at year-end (number) (***) 19,876 18,924
(*) Including restructuring costs and unusual income (expenses).
(**) Including R&D capitalised and charged to operations.
(***) Including Iveco employees of the powertrain activities conveyed in FPT (8,218 at December
31, 2007 and 8,256 at December 31, 2006).