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AT 31 DECEMBER 2010
ANNUAL REPORT
105th financial year

Table of contents

  • Page 1
    ANNUAL REPORT AT 31 DEcEmbER 2010 105th financial year

  • Page 2
    ..., Turin at 11 a.m. on 30 march 2011 (single call) to vote on the following Agenda 1. motion for approval of the Statutory Financial Statements at 31 December 2010 and allocation of profit for the year 2. Authorization for the purchase and disposal of own shares 3. Appointment of Independent Auditors...

  • Page 3
    ...Group corporate governance Share-based incentive plans Transactions between Group companies and with related parties Subsequent events and outlook Operating performance: continuing Operations Fiat Group Automobiles maserati Ferrari Fiat Powertrain components metallurgical Products Production Systems...

  • Page 4
    ... No. 15519 of 27 July 2006 consolidated Statement of cash Flows pursuant to consob Resolution No. 15519 of 27 July 2006 Notes to the consolidated Financial Statements Appendix I - Fiat companies at 31 December 2010 Appendix II - Information required under Article 149-doudecies of the "Regolamento...

  • Page 5
    4 BOARD OF DIRECTORS AND AUDITORS BOARD OF DIRECTORS AND AUDITORS BOARD OF DIRECTORS Chairman John Elkann (1) (*) Chief Executive Officer Sergio Marchionne Directors Andrea Agnelli Carlo Barel di Sant'Albano Roland Berger (3) Tiberto Brandolini d'Adda René Carron Luca Cordero di Montezemolo (**) ...

  • Page 6
    5

  • Page 7
    ... of scale to make it a long-term viable global carmaker. On the industrial side, the process to share platforms and engine technologies is moving ahead rapidly. On the commercial side, we have begun the reorganization and integration of commercial networks. As a first step, the chrysler and Lancia...

  • Page 8
    ... Trading profit will also increase significantly and is projected to reach â,¬3.3 billion in 2014. To support the growth of the two groups and new product development, we plan to invest about â,¬30 billion over the plan period, including almost â,¬2 billion a year in research. For the auto business...

  • Page 9

  • Page 10
    THE GROUP AT A GLANCE 10 2010 in summary 11 Structure: Fiat & Fiat Industrial 12 Fiat Group brands 16 Fiat Industrial Group brands 20 Fiat & Fiat Industrial Worldwide 22 Operating Responsibly

  • Page 11
    ... financial payables and receivables, outstanding at 31 December 2010 between Fiat post Demerger and Fiat Industrial occurred in January 2011. Had these transactions occurred before year end, this would have increased the Fiat reported post demerger cash (and conversely decreased the Fiat Industrial...

  • Page 12
    THE GROUP AT A GLANCE STRUCTURE: FIAT & FIAT INDUSTRIAL 11 STRUCTURE: FIAT & FIAT INDUSTRIAL

  • Page 13
    ... and Fiat Powertrain and in the production systems sector through comau. Fiat's industrial capabilities, market positioning and strategic development programs make it one of the world's most solid and competitive groups. Following the demerger, the Fiat Group's industrial and financial services...

  • Page 14
    ... commercial vehicles, the brand's mission is to support both small and large companies in growing their businesses. customers seeking productivity, ease of use and fuel efficiency rely on the know-how and innovation of Fiat Professional - their ally in meeting the challenges of the market. Maserati...

  • Page 15
    ...80 years of experience; a high level of automation; continuous upgrading of technology focused on improving quality standards; and close integration with the product development of its customers, which include the major global producers of cars, trucks, tractors and diesel engines. Comau comau makes...

  • Page 16
    15

  • Page 17
    ... make it a leader in the global capital goods sector. created through the demerger from Fiat S.p.A., the Group operates through businesses that are all major international players in their industry sectors: cNH-case New Holland, Iveco and FPT Industrial. These three sectors design, produce and sell...

  • Page 18
    ... in the world with efficient Parts & Service support and a range of financial services tailored to the agricultural industry. A professional global dealer network also guarantees total assistance and expert advice. maintaining close relationships with customers in every segment, New Holland is...

  • Page 19
    ...-keeping missions (Iveco Defence Vehicles). Iveco guarantees its customers the highest level of after-sales support worldwide and, through Iveco capital, offers advanced financial services solutions for the purchase, lease or rental of its products. The Group operates through the following brands...

  • Page 20
    ... line in emergency response that the best and most reliable technological solutions are developed. COMPONENTS FPT Industrial FPT Industrial is specialized in the design, production and sale of propulsion and transmission systems for on- and off-road trucks and commercial vehicles, as well as engines...

  • Page 21
    ... WORLDWIDE FIAT & FIAT INDUSTRIAL WORLDWIDE From the very beginning, Fiat has always had a significant international dimension and today the Group boasts an extensive global presence. by employing a global vision but interacting at the local level, the two Groups are prepared to confront new...

  • Page 22
    21 ITALY EUROPE NORTH AmERIcA REVENUES bY DESTINATION EmPLOYEES PLANTS R&D cENTERS 27.3% 45.8% 44 30 11.7% 29.2% 16 13 REVENUES bY DESTINATION EmPLOYEES PLANTS R&D cENTERS 33.0% 32.1% REVENUES bY DESTINATION EmPLOYEES PLANTS R&D cENTERS 3.1% 1.2% 6 3 24.4% 15.7% 11 13 17.9% 36.2% 29 13 ...

  • Page 23
    ... processes has become an integral part of Fiat's daily business. This is not an arbitrary commitment, but rather is increasingly central to how the Group operates, with top management leading the way. The Group Executive council (GEc) - the decision-making body headed by the chief Executive Officer...

  • Page 24
    ..., after three years as leader, Fiat Automobiles was again confirmed as having the lowest average cO2 emissions of the top selling brands in Europe (source: Jato Dynamics, September 2010). To minimize its environmental footprint, the Group has expanded the action plan established in 2009, initially...

  • Page 25

  • Page 26
    ... - Fiat Group 88 corporate governance 93 Share-based incentive plans 96 Transactions between Group companies and with related parties 97 Subsequent events and outlook 98 Operating performance: continuing Operations 99 106 108 110 112 116 117 Fiat Group Automobiles maserati Ferrari Fiat Powertrain...

  • Page 27
    ... share (â,¬) Investments in tangible and intangible assets of which: capitalized R&D costs R&D expenditure Total assets Net (debt)/cash of which: net industrial (debt)/cash Total equity Equity attributable to owners of the parent No. of employees at year end 2010 56,258 2,204 2,009 1,282 600 520 80...

  • Page 28
    .../(loss) per ordinary share (â,¬) Diluted earnings/(loss) per preference share (â,¬) Diluted earnings/(loss) per savings share (â,¬) Investments in tangible and intangible assets of which: capitalized R&D costs R&D expenditure Net industrial debt No. of employees at year end Continuing Operations 35...

  • Page 29
    ... DATA BY REGION Fiat Group pre Demerger No. of companies 2010 2009 133 140 267 265 70 74 35 33 111 109 616 621 Employees 2009 80,434 45,826 11,157 42,397 10,200 190,014 Plants 2009 64 57 16 27 24 188 R&D Centers 2009 48 33 15 10 11 117 Revenues by geographic market (â,¬ million) 2010 2009 11,907...

  • Page 30
    ..., industry conferences and non-deal roadshows in major financial centers that provide the opportunity for direct contact with management. The most important event of 2010 was the Fiat Investor Day held at Lingotto on April 21st. On that occasion, the cEO and heads of the Group's principal businesses...

  • Page 31
    ... equity markets, although performance varied significantly from market to market. In the United States, the year closed positively with the Dow Jones up around 11%: despite problems relating to public sector spending and the sustainability of the financial system, major American corporates recorded...

  • Page 32
    ...PRICE PER SHARE (*): (figures in â,¬) Ordinary shares Preference shares Savings shares (Source: Reuters) (*) Equivalent to the closing auction price... MAXIMUM PRICE IN 2010 (figures in â,¬) FIAT ORDINARY 18 16 14 12 10 8 6 4 01 02 03 04 05 06 07 08 09 10 11 12 FIAT SAVINGS 14 FIAT PREFERENcE 14 ...

  • Page 33
    ... Fiat Group Automobiles SpA and chrysler Group LLc take additional step towards integration of their distribution activities in Europe. From April 2010, FGA to commence commercial activity in support of sales and service activities for chrysler, Jeep® and Dodge brand products in several European...

  • Page 34
    ... For the 3rd consecutive year, JATO recognizes Fiat Automobiles for reduction of cO2 emissions, naming it top among 10 best-selling brands in Europe with lowest average cO2 emissions per vehicle sold in 2009: 127.8 g/km. cNH opens industrial facility in Sorocaba (brazil). case IH launches Austoft...

  • Page 35
    ...for cNH Global NV. And Standard & Poor's Ratings Services places Fiat SpA's bb+ long-term rating on creditWatch with negative implications and cNH Global N.V.'s bb+ long-term rating on creditWatch with developing implications. At bAUmA 2010 in munich, Iveco presents extensive line-up of vehicles for...

  • Page 36
    ... Gear Works (SAGW), inaugurates new plant in industrial district of Jiading (Shanghai). The JV established in 2009 was set up to produce hydraulic components for magneti marelli's Freechoiceâ„¢ automated manual transmission (or AmT). "Award of Awards" received by Iveco at ceremony held on national...

  • Page 37
    ... Equipment businesses plus related powertrain activities announced during presentation of 2010-2014 business Plan on April 21st. moody's Investor Service places Fiat's ratings (ba1/NP) under review for possible downgrade. Fiat launches 2011 model year Fiat Panda with option of two Euro 5 engines: 75...

  • Page 38
    ... New Fiat Doblò cargo named "International Van of the Year 2011" at Hanover International motor Show by panel of automotive journalists from 24 countries. case launches four new N Series loader/backhoes in North America. New Holland celebrates production of 150,000th tractor at plant in India...

  • Page 39
    ...Design 2011" at EImA International 2010 for the T7.210 Auto commandâ„¢. Standard & Poor's Rating Services assigns a preliminary bb+ long-term corporate credit rating to Fiat Industrial SpA with negative outlook. magneti marelli inaugurates new plant in Russia for production of automobile headlights...

  • Page 40
    ... years in brazil. Foundation stone laid for new FGA plant in Pernambuco, brazil. Total of bRL 3 billion to be invested with initial production capacity of 200,000 vehicles per year (plant will open in 2014). Fiat Industrial receives â,¬4.2 billion in financing from group of leading banks for working...

  • Page 41
    40 REPORT ON OPERATIONS DATI ECONOMICI E PATRIMONIALI PER SETTORE DI ATTIVITÀ

  • Page 42
    ...Group Automobiles Maserati Ferrari Fiat Powertrain Components (magneti marelli) Metallurgical Products (Teksid) Production Systems (comau) Other Businesses and Eliminations TOTAL CONTINUING OPERATIONS Agricultural and Construction Equipment (cNH) Trucks and Commercial Vehicles (Iveco) FPT Industrial...

  • Page 43
    ... of 2009 had a negative impact on the Group's earnings. Weak economic conditions resulted in a significant decline in demand for most of the Group's products. In 2010, demand levels for the automobiles business in Europe also reflected the absence of significant measures previously put in place by...

  • Page 44
    ... in funding costs. Any difficulty in obtaining financing could have a material adverse effect on the Group's business prospects, earnings and/or financial position. RISKS ASSOCIATED WITH FIAT S.P.A.'S CREDIT RATING The ability to access the capital markets or other forms of financing and the related...

  • Page 45
    ... other international passenger car and light commercial vehicle manufacturers and distributors and related components suppliers in Europe and Latin America. These markets are highly competitive in terms of product quality, innovation, pricing, fuel economy, reliability, safety, customer service and...

  • Page 46
    ... & production systems businesses, that include Fiat Group Automobiles, Ferrari, maserati, magneti marelli, Teksid and comau, in addition to the "Passenger & commercial Vehicles" business line of FPT Powertrain Technologies. by contrast to the profile of Fiat Group prior to 31 December 2010, the...

  • Page 47
    .../or financial position. RISKS ASSOCIATED WITH THE ABILITY TO OFFER INNOVATIVE PRODUCTS The success of the Group's businesses depends on their ability to maintain or increase share in existing markets and/or to expand into new markets through the development of innovative, high-quality products that...

  • Page 48
    ... Fiat S.p.A., cRF remained within Fiat Group post Demerger. To guarantee continued support to Fiat Industrial, a number of researchers working on specific projects were transferred to Fiat Industrial and service agreements entered into in relation to the contribution to the research and development...

  • Page 49
    ... at the European level (Green car Initiative, Factories of the Future). cRF has also developed a global network of more than 160 universities and research centers, and over 1,500 industrial partners around the world. This network strengthens the center's global innovation strategies and facilitates...

  • Page 50
    ... to the wheels. This makes the twin clutch transmission more comfortable and efficient than an automated manual transmission (AmT) and equivalent, or better, than a conventional automatic transmission with torque converter. The Twin clutch technology developed by Fiat Group in recent years is based...

  • Page 51
    ... commercial vehicles have in fact shown that improper driving can increase consumption by 10% to 15%, depending on the type of mission. This fact, together with an analysis of data from systems already in use, such as Fiat eco:Drive, led to cRF and Iveco establishing a joint working group to develop...

  • Page 52
    ... of vehicles and manufacturing process through the development of economically sustainable solutions for products and processes. This objective is shared at European level through the Green cars Initiative, in which cRF participates actively as a member of the Industrial Advisory Group. The...

  • Page 53
    ... of manufacturing processes. The most important of these projects were conducted at Fiat Group Automobiles' cassino and mirafiori plants and focused on development of kinetic energy recovery systems for industrial robots and testing of pilot installations of highly efficient lighting systems that...

  • Page 54
    ...its work on new methodologies for product/process development aimed at supporting Fiat Group sectors in reducing time-to-market and improving the quality of their final product. During the year, Elasis worked to improve the realism of virtual models of the interiors and exteriors of new vehicles. In...

  • Page 55
    ... Group and chrysler also continued. A new design flow was used for the first time to design electrical circuits for the future Fiat Panda, the new L0 platform vehicles and the maserati GranTurismo FL. The virtual design of the electrical system for the future Panda was also approved. The commercial...

  • Page 56
    ... production processes through the use of new technologies, methodologies and IT instruments for modeling products, plants and vehicle performance features. During the year, Elasis made a significant contribution to initiatives linked to the Virtual Product Development programs of cNH, FPT Powertrain...

  • Page 57
    ... completed by comau's Services business line in brazil. ORGANIZATIONAL AND MANAGERIAL DEVELOPMENT During 2010, developments associated with the chrysler alliance, creation of the Fiat Industrial Group (operational from 1 January 2011) and international expansion and development all brought changes...

  • Page 58
    ..., belgium, England, brazil, china and North America: all countries where the Group has a significant presence. INDUSTRIAL RELATIONS During the year, a dialog was maintained with trade unions and employee representatives at company level to achieve consensus-based solutions for managing the impact on...

  • Page 59
    ..., the Group cEO presented a plan for the relaunch of the plant involving more than â,¬1 billion of investment in the production of large SUVs for the Jeep® and Alfa Romeo brands (on a platform developed in the United States), with estimated production volumes of 250,000-280,000 vehicles per year...

  • Page 60
    ... 2011. Management of production levels The business environment improved during 2010, particularly for the capital goods sector, which had been particularly hard hit by a collapse in demand in 2009. Recovery in the automobile sector was much more contained, reflecting a decline in volumes following...

  • Page 61
    ... in net new hires slowed in the second half of the year. In Poland, Fiat Group Automobiles had to resort to overtime during the first half, but production levels fell in the latter part of the year, also impacting the Group's suppliers, with production being suspended for several days. In 2010, all...

  • Page 62
    ... of the metalworkers' contract, applied at most Group companies in Germany, was conducted at the individual state level. The agreements maintained current salary levels up to 31 march 2011, with a one-off gross payment of â,¬320 relating to the period from may 2010 to march 2011, payable in two...

  • Page 63
    ...'s current economic growth, but were nevertheless in line with increases applied for the local industrial system as a whole. Variable annual bonuses were also paid on the basis of company results. Finally, at the Fiat Automobiles Serbia Doo plant in Kragujevac, a collective labor agreement was...

  • Page 64
    63

  • Page 65
    ...FPT Powertrain Technologies (FPT Industrial sector), from the Automobile and Automobile-related components and Production Systems activities, which include the sectors Fiat Group Automobiles, maserati, Ferrari, magneti marelli, Teksid, comau and the "Passenger & commercial Vehicles" business line of...

  • Page 66
    ... increased sales of light commercial vehicles, and by Ferrari and maserati, in addition to positive currency effects, more than offset the decline in passenger cars for Fiat Group Automobiles, following the phase-out of eco-incentives in major European markets. components and Production Systems...

  • Page 67
    ... 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...

  • Page 68
    ... 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...

  • Page 69
    ... For 2010, FPT Industrial (the Industrial & marine business line of the former FPT Powertrain Technologies sector) reported â,¬2,415 million in revenues, representing an increase of 52.8% over the previous year driven by a strong increase in volumes. Sales to customers external to the Fiat Group as...

  • Page 70
    ... by higher volumes, with the exception of passenger cars for FGA, better product mix and continued focus on costs and industrial efficiencies. Trading profit/(loss) by business (â,¬ million) Automobiles (Fiat Group Automobiles, maserati, Ferrari) Components and Production Systems (Fiat Powertrain...

  • Page 71
    ... 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 â,¬24 million (trading margin: 4.1%). The...

  • Page 72
    ... demand levels for agricultural equipment in Western Europe, increased raw material prices and new product launch costs, primarily in the construction equipment sector during the fourth quarter. Trucks and Commercial Vehicles Iveco posted a trading profit of â,¬270 million for the year (2009: â,¬105...

  • Page 73
    ... components of operating profit, broken down by sector: Trading (â,¬ million) Fiat Group Automobiles Maserati Ferrari Fiat Powertrain Components (magneti marelli) Metallurgical Products (Teksid) Production Systems (comau) Other Businesses and Eliminations Total Continuing Operations 2010 607 24...

  • Page 74
    ... capitalized development costs) totaled â,¬2,864 million. Investments in subsidiaries and associates, totaling â,¬283 million, mainly related to capitalization of the 50/50 joint venture GAc Fiat Automobiles co. Ltd. (china), and the 50/50 joint venture Fiat India Automobiles Private Limited (India...

  • Page 75
    ... financial services companies (Iveco Finance Holdings Limited). For 2010, working capital (calculated on a comparable scope of operations and at constant exchange rates) decreased by â,¬2 billion due to the increase in trade payables, principally for cNH and Iveco, related to higher business volumes...

  • Page 76
    ... securities cash and cash equivalents Net Debt Industrial Activities Financial Services (*) Figures take into account the effects of the demerger which occurred on 1 January 2011 (1) Includes current financial receivables from the JV FGA capital (2) Includes the positive and negative fair value...

  • Page 77
    ... financing to third parties. Operating Performance by Activity Fiat Group pre Demerger (â,¬ million) Net revenues cost of sales Selling, general and administrative Research and development Other income/(expense) TRADING PROFIT/(LOSS) Gains/(losses) on disposal of investments Restructuring costs...

  • Page 78
    ... 9 106 106 Discontinued Operations (Fiat Industrial Group) (â,¬ million) Net revenues cost of sales Selling, general and administrative Research and development Other income/(expense) TRADING PROFIT/(LOSS) Gains/(losses) on disposal of investments Restructuring costs Other unusual income/(expense...

  • Page 79
    ...the increase in business volumes outside Europe. For Fiat Industrial, financial services generated net revenues of â,¬1,379 million (up 7.7% on 2009). by sector: Agricultural and construction Equipment reported revenues of â,¬1,220 million, up 8.1% over 2009 (+2.7% in US dollar terms), reflecting an...

  • Page 80
    ... at constant exchange rates) due primarily to an increase in volumes financed and higher margins for all companies. For Fiat Industrial, the Financial Services businesses reported a trading profit of â,¬123 million, substantially in line with 2009 (down â,¬4 million). by sector: cNH-case New Holland...

  • Page 81
    ... FIAT GROUP Statement of Financial Position by Activity (â,¬ million) Intangible assets Property, plant and equipment Investments and other financial assets Leased assets Defined benefit plan assets Deferred tax assets Total non-current assets Inventory Trade receivables Receivables from financing...

  • Page 82
    ... assets Property, plant and equipment Investments and other financial assets Leased assets Defined benefit plan assets Deferred tax assets Total non-current assets Inventory Trade receivables Receivables from financing activities Financial receivables from continuing Operations current taxes...

  • Page 83
    82 REPORT ON OPERATIONS FINANCIAL REVIEW - FIAT GROUP Net Debt by Activity (31 December 2010) Fiat Group pre Demerger (â,¬ million) Financial payables: Asset-backed financing Other current financial receivables from jointly-controlled financial services companies Intersegment financial ...

  • Page 84
    ... with the central treasury. At year end, cash and cash equivalents included cash with a pre-determined use of â,¬694 million (â,¬530 million at year-end 2009), primarily for the Financial Services companies and allocated to servicing securitization vehicles (included under asset-backed financing).

  • Page 85
    ... activities during the year before change in working capital change in working capital Cash from/(used in) operating activities during the year Investments in property, plant and equipment and intangible assets (net of vehicles sold under buy-back commitments or leased) Cash from/(used in) operating...

  • Page 86
    ... change in working capital TOTAL D) CASH FROM/(USED IN) INVESTING ACTIVITIES: Investments in: Property, plant and equipment and intangible assets (net of vehicles sold under buy-back commitments or leased) Unconsolidated subsidiaries and other investments Proceeds from the sale of non-current assets...

  • Page 87
    ... in cash primarily related to investments in tangible and intangible assets and equity investments (â,¬4,077 million), which was only partly offset by the decrease in funding provided to the Group's financial services companies by central treasury companies (included under other changes). Financing...

  • Page 88
    87

  • Page 89
    ..., the board of Directors may be composed of between nine and fifteen members. At the Annual General meeting held on 27 march 2009, Shareholders elected fifteen board members whose term of office expires on the date of the General meeting held to approve the 2011 Financial Statements. Under Article...

  • Page 90
    ... and strategic direction for the activities of the board of Directors, while the chief Executive Officer is responsible for the operational management of the Group. From an operational perspective, the chief Executive is supported by the Group Executive council (GEc), a decision-making body led...

  • Page 91
    ...its executive directors and executives with strategic responsibilities, its controlling companies or subsidiaries, or any other party related to the company. The results of these assessments are published in the Annual Report on corporate Governance. At the meeting held on 21 October 2010, the board...

  • Page 92
    ... (i.e., the network) to safeguard the independence of firms engaged to audit the financial statements. Fiat has put in place a system of risk management and internal control over financial reporting based on the model provided in the cOSO Report, according to which the internal control system is...

  • Page 93
    ... presented are still available in the Investor Relations section of the Group website (www.fiatspa.com). The board of Statutory Auditors' current term of office expires on the date of the General meeting of Shareholders called to approve the 2011 financial statements. Following is a list of the most...

  • Page 94
    ...the board of Directors granted Sergio marchionne, as a part of his variable compensation as chief Executive Officer, options to purchase 10,670,000 Fiat S.p.A. ordinary shares at a price of â,¬6.583 per share, exercisable from 1 June 2008 to 1 January 2011. In each of the first three years following...

  • Page 95
    ...the Fiat S.p.A. board of Directors approved (subject to the final approval of Shareholders at the General meeting of 5 April 2007) an eight-year stock option plan, which provided certain managers of the Group and the Fiat S.p.A. chief Executive Officer with the right to purchase a set number of Fiat...

  • Page 96
    ... of shares held at bought sold /(outgoing) held at 31.12.2009 in 2010 in 2010 managers 31.12.2010 Sergio marchionne Luca cordero di montezemolo Gian maria Gros-Pietro Executives with strategic responsibilities Fiat Ordinary Fiat Ordinary Fiat Ordinary Fiat Ordinary Fiat Preference Fiat Savings cNH...

  • Page 97
    ... party transactions formed part of the normal business activities of companies in the Group. Such transactions are concluded at standard market terms for the nature of goods and/or services offered. Information on transactions with related parties, including specific disclosures required by the...

  • Page 98
    ... inactive for several years. The plan centers around a â,¬500 million investment (to begin in the second half of 2011) for production of a new E-segment maserati for international distribution. Start of production is planned for December 2012. OUTLOOK The 2011-14 Plan and financial targets set out...

  • Page 99
    98 OPERATING PERFORMANCE: CONTINUING OPERATIONS

  • Page 100
    ...units) No. of employees at year end (*) Includes restructuring costs and other unusual income/(expense) (**) Includes capitalized R&D and R&D charged directly to the income statement COMMERCIAL PERFORMANCE The European passenger car market (EU27+EFTA) experienced a decrease of 4.9% over 2009 levels...

  • Page 101
    ...percentage points), while Alfa Romeo maintained registration levels steady (with a 0.8% share), despite the contraction in the market, due to the positive contribution of the new Giulietta in the second half. Demand in the European light commercial vehicle market was up 9.2% for the year, reflecting...

  • Page 102
    ... 250,000 units over the life of the model. Fiat and chrysler Group LLc continued the process of integration and collaboration in all business areas as per the agreements signed in 2009 establishing the global strategic alliance. With regard to vehicle and spare parts distribution in Europe, in April...

  • Page 103
    ... hours. In march 2010, for the third year running, JATO Dynamics (the world's leading provider of business intelligence to the automotive industry) named Fiat as having the lowest cO2 emissions levels among Europe's top 10 selling brands with an average 127.8 g/km per vehicle sold in 2009. The brand...

  • Page 104
    ...-emissions vehicle will be launched in the United States at the end of 2012. During the year, research and innovation activities focused on further improving leadership in time-to-market through the application of numerical simulation tools and methodologies to models currently in development. There...

  • Page 105
    ... in Europe, Latin America and china. In Europe, this activity is managed by FGA capital, a 50/50 joint venture with the crédit Agricole group (accounted for under the equity method). FGA capital supports the European sales activities of Fiat Group Automobiles through dealer financing, end-customer...

  • Page 106
    ... achieved particularly strong growth. In 2010, financing support to the sector also covered the chrysler distribution network and end customers in china, Argentina and brazil. In Italy, Fidis S.p.A. (a wholly-owned subsidiary of Fiat Group Automobiles S.p.A.) manages a factoring portfolio and issues...

  • Page 107
    ... (**) Vehicles delivered (no. of units) No. of employees at year end (*) Includes restructuring costs and other unusual income/(expense) (**) Includes capitalized R&D and R&D charged directly to the income statement OPERATING PERFORMANCE Despite continued weak economic conditions, maserati reported...

  • Page 108
    ...GTS Awards Edition, which was produced in celebration of the many international awards received by the model since its launch. 2010 also saw the release of the GranTurismo mc Stradale, the star of maserati's on-road line-up, which made its world debut at the Paris motor Show and its Italian debut at...

  • Page 109
    ... (**) Type-approved vehicles delivered to the network (no. of units) No. of employees at year end (*) Includes restructuring costs and other unusual income/(expense) (**) Includes capitalized R&D and R&D charged directly to the income statement OPERATING PERFORMANCE Ferrari closed 2010 up...

  • Page 110
    ... to customers in several European countries (Germany, the United Kingdom, Switzerland, France, belgium, Austria and Italy) and in the USA. In may 2010, the company also began offering financial services in Hungary. The new Dealer Finance business line, launched in December 2009, is currently active...

  • Page 111
    ... of employees at year end (*) Includes restructuring costs and other unusual income/(expense) (**) Includes capitalized R&D and R&D charged directly to the income statement OPERATING PERFORMANCE Fiat Powertrain produces engines and transmissions for passenger cars and light commercial vehicles (the...

  • Page 112
    ... of a high-efficiency turbo-compressor and new engine input reduction technology has enabled a 4% reduction in consumption in combined cycle. Work also continued on development of the 2.0 b Family engines with multiJet II injection system, due to go into production in early 2011 on the Fiat Freemont...

  • Page 113
    ... at year end (*) Includes restructuring costs and other unusual income/(expense) (**) Includes capitalized R&D and R&D charged directly to the income statement OPERATING PERFORMANCE During 2010, there was a global recovery in production volumes for passenger cars and light commercial vehicles. In...

  • Page 114
    ... models and for the new Fiat Panda, and headlights for bmW, Renault, citroën and chrysler. ENGINE CONTROL Revenues for 2010 totaled â,¬967 million, representing an increase of 14% over 2009, with growth concentrated in brazil, china, India and the United States. Innovation focused on development...

  • Page 115
    ...radio-navigation platform for PSA and a new infotelematic system for bmW. EXHAUST SYSTEMS Revenues totaled â,¬614 million for 2010, a 13% increase over the previous year. Sales were up for light commercial vehicles in Spain and brazil, whereas volumes declined in Italy on the back of the contraction...

  • Page 116
    ... modules business line were â,¬499 million, up 6% over the previous year. Italy experienced the greatest increase on the back of higher volumes for the Ducato and production launch of the Giulietta. Revenues were also higher in brazil with production launch of the plastic fuel intake for the new Uno...

  • Page 117
    ... business segments varied from market to market. In the passenger car and light commercial vehicle market, global production was up over 2009, with the NAFTA region recording a more significant overall increase than Europe. Production levels were also strong in brazil. The heavy vehicle market...

  • Page 118
    ... contract orders were up 80% for the year to â,¬952 million. Overall, 29% of new orders were generated in Europe and 29% in North America, with the remaining 42% in Latin America and Asia. by customer, 22% of orders came from Fiat Group companies and 78% from other manufacturers. At 31 December 2010...

  • Page 119
    OPERATING PERFORMANCE: DISCONTINUED OPERATIONS

  • Page 120
    .... of employees at year end (*) Includes restructuring costs and other unusual income/(expense) (**) Net of vehicles leased out (***) Includes capitalized R&D and R&D charged directly to the income statement COMMERCIAL PERFORMANCE In 2010, worldwide agricultural equipment industry retail unit sales...

  • Page 121
    ... represent an important point of contact between cNH brands and their customers. During 2010, cNH focused on strengthening the service offer to customers in Latin America. In brazil, cNH customer care launched a new toll-free service line at Expointer 2010 (one of the main trade shows in brazil for...

  • Page 122
    ... Social (bNDES), a federally-owned company connected to the brazilian ministry of Development, Industry and Foreign Trade. Vendor programs offered jointly with banking partners are also in place. In Australia, cNH offers dealer and end-customer financing through a captive financial services company.

  • Page 123
    ... costs Total R&D expenditure (***) No. of employees at year end (numero) (*) Includes restructuring costs and other unusual income/(expense) (**) Net of vehicles sold under buy-back commitments and leased out (***) Includes capitalized R&D and R&D charged directly to the income statement COMMERCIAL...

  • Page 124
    ....1 99.8 528.8 2009 99.1 125.6 80.5 63.4 28.4 100.4 497.4 % change 5.2 15.7 9.2 -3.2 5.9 -0.7 6.3 France Germany UK Italy Spain Rest of Western Europe Western Europe Commercial Vehicle Market (GVW âˆ' > 3.5 tons) - by product (units in thousands) 2010 154.7 48.5 325.6 528.8 2009 149.5 49.2 298...

  • Page 125
    ... 24.8 30.3 55.7 29.9 France Germany UK Italy Spain Rest of Western Europe Western Europe Eastern Europe Rest of the World Total Sales Naveco SAIc Iveco Hongyan Grand Total Commercial Vehicle Sales - by product (units in thousands) 2010 28.2 18.1 71.9 6.8 4.6 129.6 2009 22.1 12.0 57.4 7.8 4.6 103...

  • Page 126
    ... in brazil, Iveco had extremely positive commercial performance, improving both volumes and market share with a product offering that already matches its European catalog. There are plans to further expand the range with a new medium-segment vehicle based on a platform developed in china. INNOVATION...

  • Page 127
    ...In Latin America, Iveco added to its product range with the presentation of the new medium-segment Vertis in brazil in October. This vehicle was engineered in brazil on a platform developed by Iveco's JV in china and incorporating state-of-the-art technology developed in Europe. Finally, sale of the...

  • Page 128
    ...with barclays Group in which Iveco holds a 49% stake (accounted for under the equity method). This joint venture supports the sector's European sales through the provision of financing to dealers and end customers in France, Germany, Italy and the United Kingdom. In Spain, the activity is managed by...

  • Page 129
    ... financial services companies (fully consolidated). In 2010, business was positively impacted by a modest economic recovery in Western Europe in the second half and recovery, albeit tentative, in Eastern European markets. The economic climate also had an impact on the number of new vehicles financed...

  • Page 130
    ...â,¬2,415 million for the year, a 52.8% increase over 2009. Sales to customers external to the Fiat Group and to joint ventures accounted for 32.3% of total revenues (32.6% in 2009). FPT Industrial sold 423,000 units, representing a 58.1% increase over 2009. Engine deliveries were mainly to Iveco (34...

  • Page 131
    ...cNH, as well as applications specific to the agreement with Perkins Engine company Limited. For medium and heavy vehicles, development continued on the NEF and cursor diesel engines, bringing them in line with future Euro 6 emissions limits, and work was completed on development of the NEF 6.7 liter...

  • Page 132
    131

  • Page 133
    ... non-cash costs related to stock options. For 2010, the company had an average of 144 employees (152 for 2009). Other income of â,¬62 million (â,¬75 million for 2009) related principally to services rendered, including by senior managers, to other Group companies, and changes in contract work in...

  • Page 134
    ... for 2008, net of the release of deferred tax provisions related to prior years. STATEMENT OF FINANCIAL POSITION Following is a summary of Fiat S.p.A.'s statement of financial position: (â,¬ million) Non-current assets of which: Investments Shareholdings to be demerged Working capital NET CAPITAL...

  • Page 135
    ... in 2011 and 2012) net of current financial assets of â,¬213 million representing current account balances held with Fiat Finance S.p.A. A more detailed analysis of cash flows is provided in Fiat S.p.A.'s financial statements. RECONCILIATION BETWEEN EQUITY AND NET PROFIT OF THE PARENT COMPANY AND...

  • Page 136
    REPORT ON OPERATIONS MOTION FOR APPROVAL OF THE STATUTORY FINANCIAL STATEMENTS AND ALLOCATION OF 2010 PROFIT 135 MOTION FOR APPROVAL OF THE STATUTORY FINANCIAL STATEMENTS AND ALLOCATION OF 2010 PROFIT Dear Shareholders, We hereby submit the Statutory Financial Statements for the year ended 31 ...

  • Page 137

  • Page 138
    137 FIAT GROUP CONSOLIDATED FINANCIAL STATEMENTS at 31 December 2010 138 139 140 142 143 144 145 146 147 269 298 consolidated Income Statement consolidated Statement of comprehensive Income consolidated Statement of Financial Position consolidated Statement of cash Flows Statement of changes in ...

  • Page 139
    138 FIAT GROUP CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 INCOME STATEMENT CONSOLIDATED INCOME STATEMENT (â,¬ million) (*) Net revenues cost of sales Selling, general and administrative costs Research and development costs Other income (expenses) TRADING PROFIT/(LOSS) Gains (losses) ...

  • Page 140
    ...PROFIT/(LOSS) (A) Gains/(Losses) on cash flow hedges Gains/(Losses) on fair value of available-for-sale financial assets Gains/(Losses) on exchange differences on translating foreign operations Share of other comprehensive income of entities accounted for using the equity method Income tax relating...

  • Page 141
    ..., plant and equipment Investments and other financial assets: Investments accounted for using the equity method Other investments and financial assets Leased assets Defined benefit plan assets Deferred tax assets Total Non-current assets Inventories Trade receivables Receivables from financing...

  • Page 142
    ... interests Provisions: Employee benefits Other provisions Debt: Asset-backed financing Debt payable to Discontinued Operations Other debt Other financial liabilities Trade payables current tax payables Deferred tax liabilities Other current liabilities Liabilities held for sale and Discontinued...

  • Page 143
    ... payables and other financial assets/liabilities Increase in share capital Dividends paid cash flows from (used in) the financing activities of Discontinued Operations TOTAL Translation exchange differences E) TOTAL CHANGE IN CASH AND CASH EQUIVALENTS F) CASH AND CASH EQUIVALENTS AT END OF THE YEAR...

  • Page 144
    FIAT GROUP CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 STATEMENT OF CHANGES IN CONSOLIDATED EQUITY 143 STATEMENT OF CHANGES IN CONSOLIDATED EQUITY (â,¬ million) Share capital Treasury shares Capital reserves Earning reserves Cash ï¬,ow hedge reserve Cumulative translation adjustment ...

  • Page 145
    ...) Net revenues cost of sales Selling, general and administrative costs Research and development costs Other income (expenses) TRADING PROFIT/(LOSS) Gains (losses) on the disposal of investments Restructuring costs Other unusual income (expenses) OPERATING PROFIT/(LOSS) Financial income (expenses...

  • Page 146
    ..., plant and equipment Investments and other financial assets: Investments accounted for using the equity method Other investments and financial assets Leased assets Defined benefit plan assets Deferred tax assets Total Non-current assets Inventories Trade receivables Receivables from financing...

  • Page 147
    ... payables and other financial assets/liabilities Increase in share capital Dividends paid cash flows from (used in) the financing activities of Discontinued Operations TOTAL Translation exchange differences E) TOTAL CHANGE IN CASH AND CASH EQUIVALENTS F) CASH AND CASH EQUIVALENTS AT END OF THE YEAR...

  • Page 148
    ... below, from 1 January 2011 the Group will only engage in the manufacture and sale of automobiles, engines, transmission systems, automotive-related components, metallurgical products and production systems and publishing and communications. The Group has its head office in Turin, Italy. The...

  • Page 149
    ... own management and board of Directors. As the transaction took effect on 1 January 2011, the consolidated financial statements for the year ended 31 December 2010 relate to Fiat Group Pre-Demerger (hereinafter the Fiat Group). moreover, in accordance with IFRS 5 - Non-current Assets Held for Sale...

  • Page 150
    ...financial statements. The investment portfolios of financial services companies are included in current assets, as the investments will be realised in their normal operating cycle. Financial services companies, though, obtain funds only partially from the market: the remaining are obtained from Fiat...

  • Page 151
    ... in respect of the associate. Investments in other companies Investments in other companies that are available-for-sale financial assets are measured at fair value, when this can be reliably determined. Gains or losses arising from changes in fair value are recognised directly in other comprehensive...

  • Page 152
    ...consolidated statement of cash flows. Goodwill and fair value adjustments arising on the acquisition of a foreign entity are recorded in the relevant functional currency of the foreign entity and are translated using the period end exchange rate. The principal exchange rates used in 2010 and 2009 to...

  • Page 153
    ... end of the reporting period in which the combination occurs, the Group reports provisional amounts for the items for which the accounting is incomplete in the consolidated financial statements. Those provisional amounts are adjusted during the measurement period to reflect new information obtained...

  • Page 154
    ... construction equipment, related components, engines, and production systems) are recognised as an asset if and only if both of the following conditions are met: that development costs can be measured reliably and that technical feasibility of the product, volumes and pricing support the view that...

  • Page 155
    ... higher of fair value less disposal costs and its value in use. In assessing its value in use, the pre-tax estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the...

  • Page 156
    ...cash equivalents include cash at banks, units in liquidity funds and other money market securities that are readily convertible into cash and are subject to an insignificant risk of changes in value. current securities include short-term or marketable securities which represent temporary investments...

  • Page 157
    156 FIAT GROUP CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 NOTES Receivables with maturities of over one year which bear no interest or an interest rate significantly lower than market rates are discounted using market rates. Assessments are made regularly as to whether there is any ...

  • Page 158
    ...Group statement of financial position. Inventories Inventories of raw materials, semi finished products and finished goods, (including assets leased out under operating leases and assets sold under a buy-back commitment that are held for sale) are stated at the lower of cost and net realisable value...

  • Page 159
    ... provides certain post-employment defined benefits, mainly health care plans. The method of accounting and the frequency of valuations are similar to those used for defined benefit pension plans. The scheme underlying the Employee leaving entitlements in Italy of the Italian Group companies (the TFR...

  • Page 160
    ... for as operating leases when it is probable that the vehicle will be bought back. more specifically, vehicles sold with a buy-back commitment are accounted for as assets in Inventories if the sale originates from the Fiat Group Automobiles business (agreements with normally a short-term buy-back...

  • Page 161
    ... GROUP CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 NOTES cost of sales also includes provisions made to cover the estimated cost of product warranties at the time of sale to dealer networks or to the end customer. Revenues from the sale of extended warranties and maintenance contracts...

  • Page 162
    ... the year. For diluted earnings per share, the weighted average number of shares outstanding is adjusted assuming conversion of all dilutive potential shares. Use of estimates The preparation of financial statements and related disclosures that conform to IFRS requires management to make judgements...

  • Page 163
    ...and market conditions which remain difficult. Residual values of assets leased out under operating lease arrangements or sold with a buy-back commitment The Group reports assets rented to customers or leased to them under operating leases as tangible assets. Furthermore, new vehicle sales with a buy...

  • Page 164
    ... benefit plans are to be found in the United Kingdom, Germany and Italy and, as far as the Discontinued Operations relating to the Fiat Industrial Group are concerned, also in the United States. management uses several statistical and judgmental factors that attempt to anticipate future events...

  • Page 165
    ... Fiat Gm Powertrain Polska (an investment that had been accounted for in the Fiat Group's consolidated financial statements using proportionate consolidation), thereby obtaining 100% control. The Group accounted for this transaction as the step acquisition of a subsidiary. Acquisition-related costs...

  • Page 166
    ...) in diluted earnings per ordinary share as a result of applying the standard IAS 27 (2008) - Consolidated and Separate Financial Statements The revisions to IAS 27 principally affect the accounting for transactions and events that result in a change in the Group's interest in its subsidiaries and...

  • Page 167
    ...- Non-current Assets Held for Sale and Discontinued Operations. Amendments to IAS 28 - Investments in Associates and to IAS 31 - Interests in Joint Ventures consequential to the amendment to IAS 27. Improvements to IAS/IFRS (2009). Amendments to IFRS 2 - Share based Payment: Group Cash-settled Share...

  • Page 168
    ... with IAS 32. In addition, the board goes into further detail on the question of share-based payment plans that are replaced as part of a business combination by adding specific guidance to clarify the accounting treatment. IFRS 7 - Financial Instruments: Disclosures: this amendment emphasises the...

  • Page 169
    ... a global point of view, however, there is a concentration of credit risk in trade receivables and receivables from financing activities, in particular dealer financing and finance leases in the European Union market for the Fiat Group Automobiles and Trucks and commercial Vehicles sectors, in North...

  • Page 170
    ... generate a negligible volume of business: their proportion of the Group's assets, liabilities, financial position and earnings is immaterial. In particular, 50 of such subsidiaries are accounted for using the cost method, and represent in aggregate 0 percent of total Fiat Group revenues (continuing...

  • Page 171
    ... of the Group's share in the principal income statement items of jointly controlled entities accounted for using the equity method are as follows: 2010 (â,¬ million) 2009 Total 4,447 161 152 92 57 Net revenues Trading profit/(loss) Operating profit/(loss) Profit/(loss) before taxes Profit/(loss...

  • Page 172
    ... associate chrysler Group LLc ("chrysler"), as given their importance they are disclosed separately below. These amounts relate to the first reporting period of the new chrysler group (10 June to 31 December 2009) and the first nine months of 2010, since the IFRS figures for the twelve months ended...

  • Page 173
    ...the call option on the 5% of Ferrari S.p.A. share capital held by mubadala Development company PJSc was exercised. In the fourth quarter of 2010 the Fiat Group Automobiles sector acquired TcA Tecnologia en componentes Automotivos SA, a company located in the brazilian state of Pernambuco. During the...

  • Page 174
    ...(121) 64 70 (6) 2009 of which Related parties (Note 34) 837 439 180 26 2 (135) (50) (47) (3) (â,¬ million) Net revenues cost of sales Selling, general and administrative costs Research and development costs Other income (expenses) TRADING PROFIT/(LOSS) Gains (losses) on the disposal of investments...

  • Page 175
    ..., plant and equipment Investments and other financial assets: Investments accounted for using the equity method Other investments and financial assets Leased assets Defined benefit plan assets Deferred tax assets Total Non-current assets Inventories Trade receivables Receivables from financing...

  • Page 176
    ... deferred taxes change in items due to buy-back commitments change in operating lease items change in working capital TOTAL CASH FLOWS FROM (USED IN) THE INVESTING ACTIVITIES OF DISCONTINUED OPERATIONS Investments in: Property plant and equipment and intangible assets (net of vehicles sold under buy...

  • Page 177
    ... assets Property, plant and equipment Investments and other financial assets Leased assets Defined benefit plan assets Deferred tax assets Total Non-current assets Inventories Trade receivables Receivables from financing activities Financial receivables from Fiat Group Post-Demerger current tax...

  • Page 178
    ... items change in working capital TOTAL C) CASH FLOWS FROM (USED IN) INVESTING ACTIVITIES: Investments in: Property plant and equipment and intangible assets (net of vehicles sold under buy-back commitments and leased assets) Other investments Proceeds from the sale of non-current assets Net change...

  • Page 179
    ... 271 167 34 50,102 Sales of goods Rendering of services Interest income from customers and other financial income of financial services companies contract revenues Rents on assets sold with a buy-back commitment Rents on operating leases Other Total Net revenues Continuing Operations 32,752 2,163...

  • Page 180
    ... Equipment Sector on the sale of the investment in the joint venture LbX company LLc. 7. Restructuring costs Restructuring costs included in Profit (loss) from continuing Operations in 2010 amount to â,¬118 million; this amount mainly relates to the sectors Fiat Group Automobiles (â,¬90 million) and...

  • Page 181
    ...(352) (401) - (753) Net financial expenses from continuing Operations in 2010 (excluding financial services companies) totalled â,¬400 million, and include net financial income of â,¬111 million arising from the equity swaps on Fiat shares, relating to certain stock option plans (see Note 21 for...

  • Page 182
    ... profits of non-Italian companies, partially offset by the recognition of deferred tax assets of a non-recurring nature. Taxes relating to prior periods include the cost arising from certain disputes with the tax authorities. The effective tax rate of the Fiat Group for 2010 (excluding current...

  • Page 183
    ..., net of the effect of recognising or writing off deferred tax assets relating to prior years; the corresponding tax effect of items recorded directly in equity amounting to â,¬3 million; positive exchange rate differences, change in the scope of consolidation and other changes amounting to â,¬116...

  • Page 184
    ... is taken for each company in the Group by assessing critically whether the conditions exist for the future recoverability of such assets on the basis of updated strategic plans, accompanied by the related tax plans. For this reason, the total theoretical future tax benefits arising from deductible...

  • Page 185
    ...assets have not been recognised, analysed by year of expiry, are as follows: Year of expiry Unlimited/ Beyond indetermi2014 nable (â,¬ million) Total at 31 December 2010 2011 2012 2013 2014 Temporary differences and tax losses relating to State taxation (IRES in the case of Italy): Deductible...

  • Page 186
    ... 2009 Total 2,333 57,805 130,513 190,651 managers White-collar blue-collar Average number of employees 13. Earnings/(loss) per share As explained in Note 23 below, Fiat S.p.A. share capital is represented by three different classes of shares (ordinary shares, preference shares and savings shares...

  • Page 187
    ... from the stock option plans granted by Fiat S.p.A. on its ordinary shares having an exercise price of over â,¬10.25 per share (the average price of Fiat ordinary shares in 2010). Finally, for both years the theoretical effect that would arise if the stock options granted by the Group's subsidiaries...

  • Page 188
    187 The figures used to determine diluted earnings per shares for the Fiat Group are as follows: 2010 Ordinary shares Profit/(Loss) attributable to each class of shares Weighted average number of shares outstanding Number of shares deployable for stock option plans Number of shares considered in ...

  • Page 189
    188 FIAT GROUP CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 NOTES (â,¬ million) Goodwill Trademarks and other intangible assets with indefinite useful lives Development costs externally acquired Development costs internally generated Total Development costs Patents, concessions and ...

  • Page 190
    ... of Intangible assets (â,¬ million) Goodwill Trademarks and other intangible assets with indefinite useful lives Development costs externally acquired Development costs internally generated Total Development costs At 31 December 2008 2,815 170 1,344 1,985 3,329 389 307 38 7,048 Additions 307 739...

  • Page 191
    ...the System, Pico and Service businesses. In those sectors, the cash-generating unit recoverable amount is determined on the basis of their value in use defined as the discounted value of the expected future operating cash flows resulting from the estimates included in the 2010-2014 strategic plan of...

  • Page 192
    ... of planned manufacturing and product development actions as well as expectations regarding product pricing, market share and commodity costs, consistent with the assumptions reflected in the Fiat Group's 2010-2014 Strategic Plan. The sector uses eight years of expected cash flows as management...

  • Page 193
    ... of the implied multiples derived from the discounted cash flows approach using market benchmarks. cNH management identified comparable companies by reviewing all publicly traded companies operating in the cNH lines of business. The comparable companies used were determined based on an evaluation of...

  • Page 194
    ...(â,¬ million) Land Owned industrial buildings Industrial buildings leased under finance leases Total Industrial buildings Owned plant, machinery and equipment Plant, machinery and equipment leased under finance leases Total Plant, machinery and equipment Assets sold with a buy-back commitment Owned...

  • Page 195
    ...(â,¬ million) Land Owned industrial buildings Industrial buildings leased under finance leases Total Industrial buildings Owned plant, machinery and equipment Plant, machinery and equipment leased under finance leases Total Plant, machinery and equipment Assets sold with a buy-back commitment Owned...

  • Page 196
    ...2010 365 1,967 47 2,014 (â,¬ million) Land Owned industrial buildings Industrial buildings leased under finance leases Total Industrial buildings Additions Depreciation 2 99 99 (182) (2) (184) Impairment losses Divestitures (2) (2) (59) (59) (3) (3) Translation differences 13 87 87 Owned plant...

  • Page 197
    196 FIAT GROUP CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 NOTES (â,¬ million) Land Owned industrial buildings Industrial buildings leased under finance leases Total Industrial buildings At 31 December 2008 588 2,571 58 2,629 Additions Depreciation 146 146 (155) (3) (158) Impairment...

  • Page 198
    ... commercial Vehicles sector recognised impairment losses on Assets sold with a buy-back commitment for an amount of â,¬26 million (â,¬32 million in 2009) in order to align their carrying amount to market value. These losses are fully recognised in cost of sales in 2010 (recognised in cost of sales...

  • Page 199
    ... line-by-line basis, using the equity method. In 2010 Acquisitions and capitalisations amounted to â,¬132 million (â,¬63 million in 2009), of which â,¬34 million (â,¬48 million in 2009) relates to the capital increase made by the 50/50 jointly controlled entity Fiat India Automobiles Private Limited...

  • Page 200
    ... Fiat Automobiles co. Ltd. Fiat India Automobiles Private Limited Naveco (Nanjing Iveco motor co.) Ltd. Turk Traktor Ve Ziraat makineleri A.S. SAIc Iveco commercial Vehicle Investment company Limited New Holland HFT Japan Inc. LbX company LLc cNH de mexico SA de cV Transolver Finance Establecimiento...

  • Page 201
    ...on the board of Directors and is a party to a shareholder agreement. As a result the company is classified as an associate. In order to account for this investment using the equity method, reference was made to its most recent published financial statements being its Interim management Statements at...

  • Page 202
    ... the product, volumes and pricing support the view that the development expenditure will generate future economic benefits. capitalised development costs include direct and indirect costs that could be directly attributable to the development process, incurred by chrysler starting from 10 June 2009...

  • Page 203
    ... FINANCIAL STATEMENTS AT 31 DECEMBER 2010 NOTES 17. Leased assets Leased assets refers to Discontinued Operations. The sectors Trucks and commercial Vehicles and the Agricultural and construction Equipment lease out assets, mainly their own products, as part of their financial services businesses...

  • Page 204
    ...Operations for â,¬57 million (â,¬115 million in 2009). Amounts recognised as income from the reversal of write-downs on items sold during the year were not significant. The majority of amount due from customers for contract work relates to the Production Systems sector and can be analysed as follows...

  • Page 205
    204 FIAT GROUP CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 NOTES At 31 December 2010, Total current receivables include receivables sold and financed through both securitisation and factoring transactions of â,¬8,089 million (â,¬6,588 million at 31 December 2009) which do not meet IAS ...

  • Page 206
    ... 2009 and unguaranteed residual values at 31 December 2010 and 2009 are not significant. Receivables for dealer financing are typically generated by sales of vehicles and are generally managed under dealer network financing programs as a component of the portfolio of the financial services companies...

  • Page 207
    ... be in line with fair value. 20. Current securities current securities consist of short-term or marketable securities which represent temporary investments, but which do not satisfy all the requirements for being classified as cash equivalents. In particular: At 31 December 2010 At 31 December 2009...

  • Page 208
    ...2011, arranged to hedge the risk of an increase in the Fiat share price above the exercise price of the stock options granted to the chief Executive Officer in 2004 and 2006 (see Note 23). At 31 December 2010, the equity swaps have a total positive fair value of â,¬115 million (a positive fair value...

  • Page 209
    ... income statement mainly refer to the management of the currency risk and, to a lesser extent, to the hedges relating to the debt of the Group's financial companies and Group treasury. The policy of the Group for managing currency risk normally requires that future cash flows from trading activities...

  • Page 210
    ... Operations, in 2010 the Group transferred losses of â,¬93 million (losses of â,¬31 million in 2009) to income, net of the tax effect, previously recognised directly in other comprehensive income. These items are reported in the following lines: 2010 (â,¬ million) 2009 Continuing Operations...

  • Page 211
    ... Asset-backed financing. The credit risk associated with cash and cash equivalents is considered not significant, because it mainly relates to deposits spread across primary national and international financial institutions. 23. Equity Equity at 31 December 2010 exceeded that at 31 December 2009 by...

  • Page 212
    ... for general meetings. No voting rights are attached to savings shares. Until shareholder approval of the allocation of 2010 profit, the allocation of annual profit for Fiat S.p.A. will be as follows: to the legal reserve, 5% of net profit until the amount of such reserve is equivalent to one...

  • Page 213
    ...FINANCIAL STATEMENTS AT 31 DECEMBER 2010 NOTES Effects of the Demerger on the Share Capital of Fiat S.p.A. As a consequence of the Demerger, on 1 January 2011, the share capital of Fiat S.p.A. was reduced by â,¬1,913,178,892.5 to â,¬4,464,084,082.5. This took place through a reduction in par value...

  • Page 214
    ...by the end of 2011. For 2010, the board of Directors is proposing to Shareholders at their annual general meeting to pay a total dividend of â,¬155.1 million (â,¬151.6 million excluding the treasury shares owned by the Group at the date of publication of these consolidated financial statements). The...

  • Page 215
    ...% of share capital and all other provisions approved by Shareholders on 26 march 2010 shall continue to apply. Reaffirming that the share buy-back programme has been placed on hold, the board of Directors in consideration of the fact that the current authorisation expires on 26 September 2011 and to...

  • Page 216
    ... on 2011 profit or loss. As described below in the section "Amendments to the stock option plans and stock grant plans of Fiat S.p.A. arising from the Demerger", 23,021,250 of these Fiat Industrial S.p.A. shares are intended to service the vested stock option plans and the stock grant plans. Capital...

  • Page 217
    ...2009 Net balance 357 3 509 (47) 822 (â,¬ million) Gains/(losses) on cash flow hedging instruments Gains/(losses) on the remeasurement of available-for-sale financial assets Exchange gains/(losses) on translating foreign operations Share of Other comprehensive income of entities accounted for using...

  • Page 218
    ...At 31 December 2010 and at 31 December 2009, the following share-based compensation plans relating to managers of Group companies or certain members of the board of Directors of Fiat S.p.A. were in place. Stock option plans linked to Fiat S.p.A. ordinary shares The stock option plans approved by the...

  • Page 219
    ...subsequent approval of Shareholders in general meeting, which was given on 5 April 2007) an eight year stock option plan, which granted certain managers of the Group and the chief Executive Officer of Fiat S.p.A. the right to purchase a specific number of Fiat S.p.A. ordinary shares at a fixed price...

  • Page 220
    ... regarding employees who have left the Group and options not vesting during the year due to the fact that certain non-market conditions were not reached for the November 2006 and July 2008 plans. The Group recognised a total nominal cost of â,¬4.9 million in the 2010 income statement for plans...

  • Page 221
    ... until the approval of the 2011 consolidated financial statements and the targets for 2010 and 2011 were redefined. At 31 December 2010, the contractual terms of the plan were therefore as follows: Plan Stock Grant 2009 (revised) Beneficiary chief Executive Officer Number of shares 4,000,000...

  • Page 222
    ... Director's Plan provided that the director is not receiving salary or other employment compensation for current employment services provided to cNH Global N.V or Fiat Industrial Group. The proposed amendment is subject to Shareholder approval at the next annual meeting (scheduled for 29 march 2011...

  • Page 223
    ...upon the average closing price of cNH common shares on the New York Stock Exchange for the thirty-day period preceding the date of grant. beginning in 2006, cNH began to issue awards under plans providing performance-based stock options, performance-based shares, and cash. In April 2010, cNH granted...

  • Page 224
    ... basis during the three-, four- and five-year periods ending 31 December 2012, 2013 and 2014. The fair value of this award is US$34.74 per share. cNH granted performance-based, non-vested share awards under the Top Performance Plan ("TPP") in 2006 through 2009. Vesting of the TPP performance...

  • Page 225
    ... Incentive Plan 3.73 70.6 0.7 1.6 Option life (years) Price volatility of cNH Global N.V. shares (%) Expected dividend yield (%) Risk-free interest rate (%) based on this model, the weighted-average fair values of stock options awarded by cNH for the years ended 31 December 2010 and 2009 were...

  • Page 226
    ... employee benefits are paid. benefits are generally payable under these plans after the completion of employment. The plans are classified by the Group on the basis of the type of benefit provided as follows: Reserve for Employee leaving entitlements in Italy (TFR), Pension plans, Health care plans...

  • Page 227
    226 FIAT GROUP CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 NOTES The investment strategy for these assets depends on the features of the plan and on the maturity of the obligations. Typically long-term plan benefit obligations are funded by investing mainly in equity securities, as they...

  • Page 228
    ... projections from the United States Department of Health and Human Services Health care Financing Administration. The initial trend is a short-term assumption based on recent experience and prevailing market conditions. The ultimate trend is a long-term assumption of health care cost inflation based...

  • Page 229
    ...) 80 692 (299) 6 479 846 846 208 208 1,054 1,054 1,086 1,086 128 (8) 120 475 (166) 309 603 (174) 429 611 (132) 479 The amounts recognised in the statement of financial position for Health-care plans and Other post-employment benefits at 31 December 2010 and 2009 are as follows: Health care...

  • Page 230
    ... value of obligation at the end of the year 2010 258 15 11 13 1 (32) 7 4 4 (2) (1) (151) 127 The changes to the health care plans stated as past service cost in the obligation and in the composition of defined benefit plan expenses in 2010 mainly relate to the health care plans in North America...

  • Page 231
    ...employment benefits and Health-care benefits mainly consist of listed equity instruments and fixed income securities; plan assets do not include treasury shares of Fiat S.p.A. or properties occupied by Group companies. Plan assets may be summarised as follows: At 31 December 2010 At 31 December 2009...

  • Page 232
    ... 2010 (â,¬ million) Continuing Operations Discontinued Operations Total At 31 December 2009 Total At 31 December 2008 Total At 31 December 2007 Total At 31 December 2006 Total Present value of obligation: Employee leaving entitlements in Italy Pension plans Health care plans Others Fair value...

  • Page 233
    232 FIAT GROUP CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 NOTES The warranty provision represents management's best estimate of commitments given by the Group for contractual, legal, or constructive obligations arising from product warranties given for a specified period of time which ...

  • Page 234
    ...of the Group's companies. Commercial risks - this provision includes the amount of obligations arising in connection with the sale of products and services such as maintenance contracts. An accrual is recorded when the expected costs to complete the services under these contracts exceed the revenues...

  • Page 235
    234 FIAT GROUP CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 NOTES 26. Debt A breakdown of debt and an analysis by due date is as follows: At 31 December 2010 due beyond five years Total 6 1,091 159 254 1,504 1,510 533 9,019 6,657 247 1,483 17,406 17,939 At 31 December 2009 due beyond ...

  • Page 236
    ...195 million in 2010 (excluding exchange rate differences) in bonds classified as continuing Operations is mainly due to: the repayment on maturity of a bond having a nominal value of â,¬1,000 million issued by Fiat Finance and Trade Ltd S.A. in 2000 as part of the Global medium Term Notes programme...

  • Page 237
    ....com under "Investor Relations - Financial Reports". most of the bonds issued by the Group impose covenants on the issuer and, in certain cases, on Fiat S.p.A. as guarantor, which is standard international practice for similar bonds issued by companies in the same industry sector as the Group. Such...

  • Page 238
    ... 2010 amounted approximately to â,¬13,197 million. The fair value of Debt at 31 December 2009 amounted approximately to â,¬28,844 million. These amounts have been determined using the quoted market price of financial instruments, if available, or discounting the related future cash flows and using...

  • Page 239
    ...minimum future lease payments Interest expense Present value of minimum lease payments due within one year 47 (1) 46 due between one ands five year 105 (2) 103 As discussed in Note 15, finance lease payables also relate to suppliers' assets recognised in the consolidated financial statements in...

  • Page 240
    ... in the Report on Operations Less: current financial receivables, excluding those due from jointly controlled financial services companies relating to continuing Operations, amounting to â,¬12 million at 31 December 2010 (â,¬14 million at 31 December 2009) Net financial position Continuing...

  • Page 241
    ... five years 13 13 The carrying amount of Trade payables is considered in line with their fair value at the balance sheet date. 28. Other current liabilities An analysis of Other current liabilities is as follows: (â,¬ million) Advances on buy-back agreements Indirect tax payables Accrued expenses...

  • Page 242
    ... are valued at zero in the consolidated statement of financial position at 31 December 2010, consistently with the accounting for the original 20% investment in chrysler. In particular, the first Performance Event occurs when chrysler receives regulatory approval for an engine based on the Fiat FIRE...

  • Page 243
    ... through dealer and end customer financing in France, Germany, Italy and the United Kingdom, and barclays provides funding up to a maximum of â,¬3.5 billion. The agreements relating to this joint venture contain provisions that are standard for such contracts in relation to management of the company...

  • Page 244
    ...Operations, starting from these financial statements this sector is no longer reported as a whole, in accordance with IFRS 8 - Operating Segments, while the Fiat Powertrain sector, which includes the Passengers & commercial Vehicles line of business, and the FPT Industrial sector, which includes the...

  • Page 245
    ... revenues from the production and sale, predominantly in Europe, of trucks and commercial vehicles, buses and special use vehicles. The segment also offers financial services directly to its customers and dealers in Eastern Europe, while in Western Europe these offered through Iveco Finance Holdings...

  • Page 246
    ... statement by operating segment for the years ended 31 December 2010 and 2009 are as follows: Fiat Group Automobiles Fiat Powertrain Magneti Marelli Other Unallocated Operating items & Segments adjustments FIAT Group (â,¬ million) Maserati Ferrari Teksid Comau 2010 Segment revenues Revenues...

  • Page 247
    246 FIAT GROUP CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 NOTES Details of the income statement by operating segment for Discontinued Operations for the years ended 31 December 2010 and 2009, based on the rules used for operating segments forming part of continuing Operations, are as ...

  • Page 248
    ... financial statements. Fiat Group Automobiles Fiat Powertrain Magneti Marelli Other Unallocated Operating items & Segments adjustments FIAT Group (â,¬ million) Maserati Ferrari Teksid Comau At 31 December 2010 Segment assets Tax assets Receivables from financing activities, Non-current...

  • Page 249
    ... and Securities of industrial companies cash and cash equivalents, current securities and Other financial assets of industrial companies Total Treasury assets Total unallocated assets Total Assets Segment operating assets include: Investments in associates and joint-ventures accounted for by using...

  • Page 250
    ... from the standpoint of the new Fiat Industrial Group or to present the Group's operations as if the Demerger had not occurred. 31. Information by geographical area The Group's parent company has its registered office in Italy. In 2010, revenues earned from external customers may be analysed as...

  • Page 251
    ... its normal business relations with customers and dealers, and its financing activities; liquidity risk, with particular reference to the availability of funds and access to the credit market and to financial instruments in general; market risk (principally relating to exchange rates, interest...

  • Page 252
    ... customers are subject to specific assessments of their creditworthiness under a detailed scoring system; in addition to carrying out this screening process, the Group also obtains financial and non-financial guarantees for risks arising from credit granted for the sale of cars, commercial vehicles...

  • Page 253
    .... The two main factors that determine the Group's liquidity situation are on the one hand the funds generated by or used in operating and investing activities and on the other the debt lending period and its renewal features or the liquidity of the funds employed and market terms and conditions. As...

  • Page 254
    ... from the company's money of account. certain of the Group's subsidiaries are located in countries which are not members of the European monetary union, in particular the United States, canada, the United Kingdom, Switzerland, the czech Republic, brazil, Poland, Turkey, India, china, Argentina and...

  • Page 255
    ... fair value) from floating rate financial instruments (for which the impact is assessed in terms of cash flows). The fixed rate financial instruments used by the Group consist principally of part of the portfolio of the financial services companies (basically customer financing and financial leases...

  • Page 256
    ... directly in equity Other non-current securities current securities available-for-sale Financial assets at fair value held-for-trading: current investments current securities held for trading Other financial assets Total Assets Other financial liabilities Total Liabilities (20) (21) (21) In 2010...

  • Page 257
    ... directly in equity Other Non current securities current securities available for sale Financial assets at fair value held for trading: current investments current securities held for trading Other financial assets Total Assets Other financial liabilities Total Liabilities (20) (21) (21) In 2010...

  • Page 258
    ... investments and non current financial assets Inventories Trade receivables current receivables from financing activities Other current assets current financial assets cash and cash equivalents Asset-backed financing Other debt Other financial liabilities Trade payables Other current liabilities...

  • Page 259
    ..., trade receivables and payables, current receivables from financing activities, asset backed-financing, and other financial payables. The effects arising on the financial statements are set out as follows. Net revenues: transactions consist principally of sales of motor vehicles, production systems...

  • Page 260
    ... on the financial statements are set out as follows. Net Revenues: transactions consist principally of sales of motor vehicles and components, including engines and gearboxes, production systems, and the provision of services, to the following companies: (â,¬ million) chrysler, for the sale of...

  • Page 261
    ... in 2009). In 2010 the amount includes the purchase of goods of â,¬19 million (â,¬18 million in 2009) for the high range and deluxe upholstery of the Group's automobiles from Poltrona Frau S.p.A., a company listed on the Italian Stock Exchange in which the chairman of the board of Directors of Fiat...

  • Page 262
    ... Other investments and non-current financial assets Trade receivables current receivables from financing activities Financial receivables from continuing Operations current tax receivables Other current assets current financial assets cash and cash equivalents Asset-backed financing Debt payable to...

  • Page 263
    ... commercial Vehicle Investment company Limited for technical services New Holland HFT Japan Inc., for the sale of agricultural and construction equipment Other Total Net revenues from jointly controlled entities 2010 123 46 26 23 14 17 249 2009 97 36 19 2 23 14 191 cost of sales: transactions...

  • Page 264
    ..., production systems, and the provision of services, to the following companies: (â,¬ million) Iveco Finance Holdings Ltd. (a subsidiary of the barclays group), for the sale of industrial vehicles leased out by the associate Other Total Net Revenues from associated companies 2010 126 112 238 2009...

  • Page 265
    ... for both 2010 and 2009 the notional compensation cost arising from stock options and stock grants awarded to the chief Executive Officer. The aggregate expense incurred in 2010 and accrued at year end for the compensation of Executives with strategic responsibilities of the Group amounts to...

  • Page 266
    ...of 2009, Fiat Group Automobiles sector acquired an investment of 100% in a minor company in brazil that has been classified as held for sale. Disposals In 2010 the Group disposed of the following businesses: On 1 February 2010 the sale of Targa Rent S.r.l., a subsidiary of the Fiat Group Automobiles...

  • Page 267
    ..., associates and other companies 36 (3) 33 33 consideration received: consideration due Deferred sales proceeds, net Total Consideration received Total Net cash inï¬,ows on disposals In 2009 the Group disposed of the following businesses: certain minor investments of the comau sector were sold...

  • Page 268
    ...the line item Translation exchange differences. cash flows from (used in) operating activities derive mainly from the Group's main revenue producing activities. The cash flows generated by the sale of vehicles under buy-back commitments, net of the amounts included in Profit/(loss) for the year, are...

  • Page 269
    ... for several years. The plan centers around a â,¬500 million investment (to begin in the second half of 2011) for production of a new E-segment maserati for international distribution. Start of production is planned for December 2012. 18 February 2011 On behalf of the Board of Directors /s/ John...

  • Page 270
    ... (pursuant to IFRS 8). For each company, the following information is provided: name, location of registered office, country and share capital stated in original currency). Additionally, the percentage consolidated and the percentage interest held directly by Fiat S.p.A. or its subsidiary is also...

  • Page 271
    ... Parent Company Fiat S.p.A. Turin Italy 6,377,262,975 EUR ----- CONTINUING OPERATIONS SUbSIDIARIES cONSOLIDATED ON A LINE-bY-LINE bASIS Fiat Group Automobiles Fiat Group Automobiles S.p.A. Abarth & c. S.p.A. Alfa Romeo Automobiles S.p.A. Alfa Romeo U.S.A. S.p.A. banco Fidis S.A. customer Services...

  • Page 272
    ... Fiat Group Automobiles Switzerland S.A. Fiat Group Automobiles UK Ltd Fiat magyarorszag Kereskedelmi KFT. FIAT NORTH AmERIcA LLc Fiat Professional S.p.A. Fiat Real Estate Germany GmbH Fiat SR Spol. SR.O. Fidis S.p.A. i-FAST Automotive Logistics S.r.l. i-FAST container Logistics S.p.A. International...

  • Page 273
    ... Ltd. Ferrari maserati cars Sales and Services (Shanghai) cO.,LTD Ferrari N.America Inc. Turin Italy 100,000 EUR 100.00 Fiat Group Automobiles S.p.A. 100.000 modena Schlieren Wiesbaden Slough berkshire Tokyo Englewood cliffs Paris Italy Switzerland Germany United Kingdom Japan U.S.A. France...

  • Page 274
    ...-bY-LINE bASIS (continued) % of Group consoliName Registered Office Country Share capital Currency dation Interest held by % interest held % of voting rights Ferrari North Europe Limited Ferrari South West Europe S.A.R.L. mugello circuit S.p.A. Slough berkshire Levallois-Perret Scarperia United...

  • Page 275
    274 CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 APPENDIX I FIAT COMPANIES SUbSIDIARIES cONSOLIDATED ON A LINE-bY-LINE bASIS (continued) % of Group consoliName Registered Office Country Share capital Currency dation Interest held by % interest held % of voting rights Industrial Yorka ...

  • Page 276
    ...LINE bASIS (continued) % of Group consoliName Registered Office Country Share capital Currency dation Interest held by % interest held % of voting rights magneti marelli Hellas A.E. in liquidation Athens magneti marelli Holding U.S.A. Inc. magneti marelli Iberica S.A. magneti marelli India Private...

  • Page 277
    276 CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 APPENDIX I FIAT COMPANIES SUbSIDIARIES cONSOLIDATED ON A LINE-bY-LINE bASIS (continued) % of Group consoliName Registered Office Country Share capital Currency dation Interest held by % interest held % of voting rights Plastiform A.S. ...

  • Page 278
    ... Publikompass S.p.A. Windsor boblingen betim Luton Trappes Southfield Pune New York Tepotzotlan Tepotzotlan Tepotzotlan Tepotzotlan bielsko-biala Southfield Oradea moscow madrid canada Germany brazil United Kingdom France U.S.A. India U.S.A. mexico mexico mexico mexico Poland U.S.A. Romenia Russia...

  • Page 279
    ... Fiat Finance and Trade Ltd S.A. Fiat Finance canada Ltd. Fiat Finance et Services S.A. Fiat Finance North America Inc. Fiat Finance S.p.A. Fiat Gestione Partecipazioni S.p.A. Fiat GmbH Fiat Group marketing & corporate communication S.p.A. Fiat Group Purchasing France S.a.r.l. Fiat Group Purchasing...

  • Page 280
    ... S.p.A. Fiat S.p.A. Fiat S.p.A. Fiat Group Automobiles S.p.A. cNH Global N.V. Iveco S.p.A. comau S.p.A. Ferrari S.p.A. Fiat Group Purchasing S.r.l. Fiat Powertrain Technologies SpA Fiat Services S.p.A. Itedi-Italiana Edizioni S.p.A. magneti marelli S.p.A. maserati S.p.A. Teksid S.p.A. Fiat Finance...

  • Page 281
    280 CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 APPENDIX I FIAT COMPANIES SUbSIDIARIES cONSOLIDATED ON A LINE-bY-LINE bASIS (continued) % of Group consoliName Registered Office Country Share capital Currency dation Interest held by % interest held % of voting rights SIRIO - Sicurezza ...

  • Page 282
    ... AccOUNTED FOR USING THE EQUITY mETHOD Fiat Group Automobiles FGA cAPITAL S.p.A. FAL Fleet Services S.A.S. Fc France S.A. FGA bank G.m.b.H. FGA bank Germany G.m.b.H. FGA cAPITAL bELGIUm S.A. FGA capital Danmark A/S FGA cAPITAL HELLAS S.A. FGA cAPITAL IFIc SA FGA capital Netherlands b.V. FGA cAPITAL...

  • Page 283
    ... company GAc FIAT Automobiles co. Ltd. (business Fiat Powertrain) Components Endurance magneti marelli Shock Absorbers (India) Private Limited magneti marelli motherson Auto System Limited magneti marelli motherson India Holding b.V. magneti marelli SKH Exhaust Systems Private Limited Pune New...

  • Page 284
    ... ENTITIES AccOUNTED FOR USING THE EQUITY mETHOD (continued) % of Group consoliName Registered Office Country Share capital Currency dation Interest held by % interest held % of voting rights SAIc mAGNETI mARELLI Powertrain co. Ltd Shanghai SKH magneti marelli Exhaust Systems Private Limited...

  • Page 285
    284 CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 APPENDIX I FIAT COMPANIES % of Group consoliName Registered Office Country Share capital Currency dation Interest held by % interest held % of voting rights SUbSIDIARIES VALUED AT cOST Fiat Group Automobiles (*) cmP componentes e ...

  • Page 286
    ....000 68.000 Holding companies and Other companies Fiat common Investment Fund Limited Fiat Gra.De EEIG London Watford United Kingdom United Kingdom 2 0 GbP GbP 100.00 97.29 Fiat U.K. Limited Fiat Group Automobiles S.p.A. cNH Global N.V. Fiat Netherlands Holding N.V. business Solutions S.p.A. Fiat...

  • Page 287
    ... FINANCIAL STATEMENTS AT 31 DECEMBER 2010 APPENDIX I FIAT COMPANIES SUbSIDIARIES VALUED AT cOST (continued) % of Group consoliName Registered Office Country Share capital Currency dation Interest held by % interest held % of voting rights Orione-Società Industriale per la Sicurezza e la...

  • Page 288
    ... Registered Office Country Share capital Currency dation Interest held by % interest held % of voting rights ASSOcIATED cOmPANIES VALUED AT cOST Fiat Group Automobiles consorzio per la Reindustrializzazione Area di Arese S.r.l. in liquidation Fidis Rent GmbH Turin Auto Private Ltd. in liquidation...

  • Page 289
    288 CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 APPENDIX I FIAT COMPANIES ASSOcIATED cOmPANIES VALUED AT cOST (continued) % of Group consoliName Registered Office Country Share capital Currency dation Interest held by % interest held % of voting rights maxus mc2 S.p.A. Turin Italy ...

  • Page 290
    ... Equipment cNH Global N.V. banco cNH capital S.A. bli Group Inc. blue Leaf I.P. Inc. case brazil Holdings Inc. case canada Receivables, Inc. case credit Holdings Limited case Dealer Holding company LLc case Equipment Holdings Limited case Equipment International corporation case Europe S.a.r.l. case...

  • Page 291
    ... GmbH cNH Engine corporation cNH Europe Holding S.A. cNH Financial Services A/S cNH Financial Services GmbH cNH Financial Services S.A.S. cNH France S.A. cNH International S.A. cNH Italia s.p.a. cNH Latin America Ltda. calgary canada canada 1 1 cAD cAD 88.86 88.86 cNH capital canada Ltd. case...

  • Page 292
    ....000 100.000 48.965 51.035 Flagship Dealer Holding company, LLc Wilmington San mauro Torinese Italy basildon Antwerp berlin Oklahoma city calgary Shanghai United Kingdom belgium Germany U.S.A. canada People's Rep.of china Ruckersdorf-Harmanns Austria Turin Prague bucharest Sofia budapest Vienna...

  • Page 293
    292 CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2010 APPENDIX I FIAT COMPANIES SUbSIDIARIES cONSOLIDATED ON A LINE-bY-LINE bASIS (continued) % of Group consoliName Registered Office Country Share capital Currency dation Interest held by % interest held % of voting rights Afin Leasing Ifn ...

  • Page 294
    ... Holdings Limited Iveco Insurance Vostok LLc Iveco International Trade Finance S.A. Iveco Investitions GmbH Iveco L.V.I. S.a.s. Hauconcourt Vénissieux Watford moscow Paradiso Ulm Saint Priest Spain France France United Kingdom Russia Switzerland Germany France brazil United Kingdom Germany Germany...

  • Page 295
    ... S.A. European Engine Alliance S.c.r.l. Fiat Powertrain Technologies management (Shanghai) co. Ltd. Fiat Powertrain Technologies of North America, Inc. FPT - Powertrain Technologies France S.A. Iveco España S.L. (business FPT Industrial) Turin Fécamp barcelona Turin Dandenong Kiev La Victoria...

  • Page 296
    ... Investment company Limited 100.000 100.000 88.340 6.000 5.660 100.000 100.000 30.000 60.000 Iveco Sweden A.b. (business Trucks and Commercial Vehicles) Arlov SAIc Fiat Powertrain Hongyan co. Ltd. chongqing Holding companies and Other companies Fiat Industrial Finance Europe S.A. Fiat Industrial...

  • Page 297
    ... 2010 APPENDIX I FIAT COMPANIES JOINTLY-cONTROLLED ENTITIES AccOUNTED FOR USING THE EQUITY mETHOD (continued) % of Group consoliName Registered Office Country Share capital Currency dation Interest held by % interest held % of voting rights SAIc IVEcO commercial Vehicle Investment company...

  • Page 298
    ...,028 EUR 100.00 ASSOcIATED cOmPANIES AccOUNTED FOR USING THE EQUITY mETHOD Agricultural and Construction Equipment Al-Ghazi Tractors Ltd cNH capital Europe S.a.S. Employers Health Initiatives LLc Farm FZcO Karachi Puteaux Wilmington Jebel Ali Pakistan France U.S.A. United Arab Emirates Japan 214...

  • Page 299
    ...IRAP, Form 770) and reports for refund of tax credits and other contributions for research activities; attestations associated with the demerger and application for listing of Fiat Industrial S.p.A. shares. (4) Attestation of tax forms. (5) Review and analysis related to the accounting treatment for...

  • Page 300
    ... conditions, results of operations and cash flows of the company and its consolidated subsidiaries as of 31 December 2010 and for the year then ended. 3.2 The report on operations includes a reliable operating and financial review of the company and of the Group as well as a description of the main...

  • Page 301

  • Page 302
    FIAT S.P.A. STATUTORY FINANCIAL STATEMENTS at 31 December 2010 302 302 303 304 305 306 307 308 309 370 Income Statement Statement of comprehensive Income Statement of Financial Position Statement of cash Flows Statement of changes in Equity Income Statement pursuant to consob Resolution no. 15519 of...

  • Page 303
    ... on in the notes to individual line items and Note 30. STATEMENT OF COMPREHENSIVE INCOME (â,¬ thousand) 2010 2009 PROFIT/(LOSS) (A) Gains/(losses) recognized directly in fair value reserve (investments in other companies) Income tax relating to components of other comprehensive income TOTAL...

  • Page 304
    ... OF FINANCIAL POSITION (figures in â,¬) Note 31 December 2010 (*) 31 December 2009 ASSETS Non-current assets Intangible assets Property, plant and equipment Investments Other financial assets Other non-current assets Deferred tax assets Total non-current assets CURRENT ASSETS Inventory Trade...

  • Page 305
    ...-cash cost of stock option plans Impairment losses/(reversals) on investments Fair value adjustment to equity swaps on Fiat shares Losses/(gains) on disposals change in provisions for employee benefits and other provisions change in deferred taxes change in working capital TOTAL C) CASH FROM/(USED...

  • Page 306
    ... FINANCIAL STATEMENTS AT 31 DECEMBER 2010 STATEMENT OF CHANGES IN EQUITY 305 STATEMENT OF CHANGES IN EQUITY Reserve available for the purchase of own shares 1,142,740 Gains/ (losses) recognized directly in equity (631) (â,¬ thousand) Balances at 31 December 2008 Allocation of prior year profit...

  • Page 307
    ... of which related parties (Nota 30) Dividends and other income from investments Impairment (losses)/reversals on investments Gains/(losses) on disposals Other operating income Personnel costs Other operating costs Financial income/(expense) PROFIT/(LOSS) BEFORE TAXES Income taxes PROFIT/(LOSS) FROM...

  • Page 308
    ... 2009 of which related parties (Note 30) ASSETS Non-current assets Intangible assets Property, plant and equipment Investments Other financial assets Other non-current assets Deferred tax assets Total non-current assets Current assets Inventory Trade receivables current financial receivables...

  • Page 309
    ...-cash cost of stock option plans Impairment losses/(reversals) on investments Fair value adjustment to equity swaps on Fiat shares Losses/(gains) on disposals change in provisions for employee benefits and other provisions change in deferred taxes change in working capital TOTAL C) CASH FROM/(USED...

  • Page 310
    ... consolidated financial statements for the Fiat Group for the year ended 31 December 2010. Demerger and presentation of assets and liabilities to be demerged Pursuant to the Deed of Demerger executed on 16 December 2010, the Demerger - approved by the Shareholders of Fiat S.p.A. and Fiat Industrial...

  • Page 311
    ..., those accounting standards were also used to prepare the separate financial statements of the Parent company, Fiat S.p.A., for the first time for the year ended 31 December 2006. The information required by IFRS 1 - First-time Adoption of International Financial Reporting Standards relating to the...

  • Page 312
    ... investments in subsidiaries and associate companies are impaired, as their market value (fair value less costs to sell) cannot be reliably measured, the recoverable amount is considered to be their value in use, which is determined by estimating the present value of the estimated future cash flows...

  • Page 313
    ...cash at banks, units in liquidity funds and other money market securities that are readily convertible into cash and are subject to an insignificant risk of changes in value. Non-current financial payables includes liabilities related to financial guarantees. These financial guarantees are contracts...

  • Page 314
    ... income statement for the period. Non-current financial payables, other non-current liabilities, trade payables, current financial payables and other payables are measured on initial recognition at fair value (normally represented by their original cost), including any transaction costs. Financial...

  • Page 315
    ... has an obligation under national collective bargaining agreements, are defined benefit plans. Payments made by the company for defined contribution plans are recognized as a cost in the income statement when incurred. Defined benefit plans are based on the employee's working life and on the...

  • Page 316
    ... to 7 November 2002. The compensation component from stock option plans based on Fiat S.p.A. shares relating to employees of other Group companies is recognized as a capital contribution to the subsidiaries which employ beneficiaries of the stock option plans, in accordance with IFRIc 11 and, as...

  • Page 317
    ...in 2010, both times for a minimum three-year period. Fiat S.p.A. acts as the consolidating company in this program and calculates a single taxable base for the group of companies taking part, enabling benefits to be realized from the offsetting of taxable income and tax losses in a single tax return...

  • Page 318
    ...for 2011, and the assumptions and resulting output are consistent with statements made in the Report on Operations under "Subsequent Events and Outlook", in addition to the Fiat Group 2010-2014 business Plan presented to the financial community on 21 April 2010. For valuation purposes, annual profit...

  • Page 319
    ... at amortized cost or fair value - replacing the many different rules in IAS 39 - which is based on how an entity manages its financial instruments and the contractual cash flow characteristics of the financial assets. For financial liabilities, on the other hand, the principal change relates to the...

  • Page 320
    ... International Financial Reporting Standards: this amendment clarifies that if an entity has to measure its assets at fair value due to a special event such as an IPO or a privatization in accordance with local law, the revalued amount may also be used in preparation of the IFRS financial statements...

  • Page 321
    ...) 2010 180,000 99,990 80,000 50,000 18,319 428,309 415 428,724 2009 700,000 559,691 1,259,691 140 1,259,831 Dividends from subsidiaries: Fiat Finance S.p.A. magneti marelli S.p.A. Fiat Powertrain Technologies S.p.A. Fiat Netherlands Holding N.V. business Solutions S.p.A. Fiat Group Automobiles...

  • Page 322
    ... to the principal companies in the Group (see Note 30). For 2009, revenues from services rendered to third parties related to fees payable to Fiat S.p.A. for activities carried out directly by the company (management, coordination and organization) in relation to the contract with Treno Alta...

  • Page 323
    322 FIAT S.P.A. STATUTORY FINANCIAL STATEMENTS AT 31 DECEMBER 2010 NOTES Other revenues and income from Group companies mostly related to the recovery of costs, rental income from real estate properties and to directors' fees paid by companies for duties performed by Fiat S.p.A. employees. Other ...

  • Page 324
    ... 101,591 2009 25,352 39,592 8,154 3,685 734 1,644 62 6,682 85,905 costs for services rendered by Group companies primarily consisted of assistance and consultancy of an administrative and financial nature, public relations, payroll services, security services and internal audit services (see Note...

  • Page 325
    ... in 2011, following extension of the two contracts during the year) entered into as hedges against Fiat shares rising above the exercise price of the stock options granted to the chief Executive Officer in 2004 and 2006 (see Note 19). At 31 December 2010, the equity swaps had a notional value, based...

  • Page 326
    ... periods Total income taxes current IRES tax for 2010 represents a â,¬39,619 thousand income and relates to compensation receivable by Fiat S.p.A. for tax loss carryforwards contributed to the domestic tax consolidation scheme. Deferred IRAP relates to profit recognized on contract work in progress...

  • Page 327
    ... conditions for their future realization, using updated strategic plans and the related tax plans. As a consequence, the total theoretical future tax benefit arising from deductible temporary differences (â,¬7,785 thousand at 31 December 2010 and â,¬8,300 thousand at 31 December 2009) and tax loss...

  • Page 328
    ...December 2010 (105) 512 105 (195) 317 Intangible assets essentially consist of leasehold improvements, which are amortized over the term of the lease agreement (4 and 12 years). Amortization on intangible assets is recognized in the income statement under other operating costs (Note 6). During 2009...

  • Page 329
    ... to the previous year) while buildings mainly comprise the company's headquarters in Via Nizza 250, Turin. Plant and machinery was principally made up of general plant used in the buildings. Other tangible assets comprised cars, office furniture and equipment. Assets under development and advances...

  • Page 330
    ... Investments in subsidiaries and changes during the year are provided in the following table: % (â,¬ thousand) interest 31 December 2009 Fiat Group Automobiles ...(16,000) Fiat Finance S.p.A. 100.00 222,263 Gross carrying amount 222,263 Accumulated impairment losses Fiat Finance North America Inc. 39....

  • Page 331
    ...at year-end 2009), a value which continues to reflect a discount to the book value of equity. Therefore, given the relative carrying value of the investment in the Group's accounts, where it is recognized under the equity method, as well as the relative stake held, for which the current stock market...

  • Page 332
    ... mubadala Development company PJSc and payment of the agreed consideration by Fiat S.p.A. - a financial asset was recognized, under financial receivable relating to exercise of the call option on Ferrari shares, for an amount equivalent to the exercise price (â,¬122,399 thousand) plus the value of...

  • Page 333
    ... 2009 196,529 606,941 114,997 39,127 6 311,526 646,074 Change (410,412) 75,870 (6) (334,548) The current account with Fiat Finance S.p.A. reflects the balance on the account held with that company as part of the Group's centralized treasury management. The amount reported at 31 December 2010...

  • Page 334
    ... the fair value of the two equity swaps on Fiat S.p.A. shares entered into with major banks by Fiat Finance S.p.A., under instruction from Fiat S.p.A., to hedge against an increase in the share price above the exercise price of the stock options granted to the company's chief Executive Officer in...

  • Page 335
    ... in euros in the company's current accounts. The carrying amount of cash and cash equivalents is deemed to be in line with their fair value. The credit risk relating to cash and cash equivalents is insignificant since the counterparties are leading national and international banks. 18. Assets and...

  • Page 336
    ...Procedures for General meetings. No voting rights are attached to savings shares. Prior to shareholder approval of the allocation of 2010 profit, the allocation of annual profit for Fiat S.p.A. will be as follows: to the legal reserve, 5% of net profit until the amount of the reserve is equal to one...

  • Page 337
    ...reserve has reached one-fifth of share capital. A company may not purchase own shares for an amount exceeding the value of distributable profits and available reserves reported in its most recently approved financial statements. Any purchase must be approved by shareholders in general meeting and in...

  • Page 338
    ... by the end of 2011. For 2010, the board of Directors will propose to Shareholders at the Annual General meeting that they approve payment of a total dividend of â,¬155.1 million (â,¬151.6 million excluding own shares held by Fiat S.p.A. at the date of publication of these financial statements). The...

  • Page 339
    ... available for the purchase of own shares and the transfer of the same amount to the retained profit/(loss) reserve. Although the share buy-back program has been placed on hold, the board of Directors, in consideration of the fact that the current authorization expires on 26 September 2011 and to...

  • Page 340
    ...17,241 thousand over 31 December 2009, due to the cost recognized in the income statement for the year related to stock option and stock grant plans for the chief Executive Officer that are based on Fiat S.p.A. shares (see Note 6). Other reserves At 31 December 2010, other reserves amounted to â,¬89...

  • Page 341
    ... 2010 and at 31 December 2009, the following share-based compensation plans relating to managers of Group companies or the chief Executive Officer of Fiat S.p.A. were in place. Stock option plans linked to Fiat S.p.A. ordinary shares The stock option plans approved by the board of Directors of Fiat...

  • Page 342
    ...subsequent approval of Shareholders in general meeting, which was given on 5 April 2007) an eight year stock option plan, which granted certain managers of the Group and the chief Executive Officer of Fiat S.p.A. the right to purchase a specific number of Fiat S.p.A. ordinary shares at a fixed price...

  • Page 343
    ... the 2010 financial statements are approved. As these profitability targets had not been met at 31 December 2010, none of the rights granted to employees vested. The contractual terms of the 2008 plan were as follows: Plan Stock Option July 2008 (forfeited) (*) Beneficiary managers Expiry date...

  • Page 344
    ... until the approval of the 2011 consolidated financial statements and the targets for 2010 and 2011 were redefined. At 31 December 2010, the contractual terms of the plan were therefore as follows: Plan Stock Grant 2009 (revised) Beneficiary chief Executive Officer Number of shares 4,000,000...

  • Page 345
    ... originally established as part of the total objectives for the pre-Demerger Fiat Group. All stock option and stock grant plans, with the exception of the portion of the 2006 Plan relating to managers for which a capital increase was approved, will be serviced by the treasury shares held by Fiat...

  • Page 346
    ... the Projected Unit credit method. Any resulting actuarial gains and losses are accounted for using the corridor approach. Finally, the company grants certain other long-term benefits to its employees; these benefits include those generally paid when the employee attains a specific seniority. In...

  • Page 347
    ...service cost and net actuarial (gains) losses recognized during the year are recorded in the income statement item personnel costs (see Note 5) if relating to employees and in other operating costs (see Note 6) if relating to the chief Executive Officer. Interest costs are recognized under financial...

  • Page 348
    ... value of defined benefit obligation Other non-current provisions At 31 December 2010, this item totaled â,¬1,021 thousand (â,¬1,245 thousand at 31 December 2009) and mainly relates to future amounts to be paid to employees who left the company in previous years under a long-term benefit program...

  • Page 349
    ... thousand) maturing in 2011 maturing in 2012 maturing in 2013 Total financial payables to Group companies 31 December 2010 400,000 1,150,000 1,000,000 2,550,000 The fair value of these loans at 31 December 2010 was â,¬2.7 billion and was calculated using market rates of interest appropriately...

  • Page 350
    ... year end. The item consisted of the following: (â,¬ thousand) 31 December 2010 4,385 9,176 13,561 31 December 2009 4,690 9,661 14,351 Change (305) (485) (790) Non-current post-employment benefits to be paid: to a former chief Executive Officer to former employees Total other non-current...

  • Page 351
    ... At 31 December 2010, current financial liabilities amounted to â,¬294,592 thousand, representing a net increase of â,¬137,880 thousand over the previous year end. The amounts related to: (â,¬ thousand) 31 December 2010 Financial payables to Group companies: Loans from Fiat Finance S.p.A. 100,000...

  • Page 352
    ...: Progress payments for work completed Gross amount due to the customer Net contractual advances Total advances 31 December 2010 242,709 244,479 1,770 239 2,009 31 December 2009 237,254 242,370 5,116 749 5,865 Change 5,455 2,109 (3,346) (510) (3,856) The item relates to contracts for the high speed...

  • Page 353
    ...for the activities directly carried out by Fiat S.p.A. contract costs relating to the contract revenue recognized totaled â,¬ 97,258 thousand at 31 December 2010 (â,¬95,589 thousand at 31 December 2009). changes in contract work in progress have been recognized in the income statement under the item...

  • Page 354
    ... work by the customer, except where other specific conditions have been stipulated. Finally, for those lines where work was still in progress at year end (bologna-Florence and Novara-milan) the lines were formally handed over to T.A.V. S.p.A. in 2009 and the high-speed line was opened to the public...

  • Page 355
    ... over 31 December 2009. This amount mostly relates to sureties provided on behalf of Group companies on billets de Trésorerie issued (Fiat Finance and Trade Ltd S.A. â,¬61,444 thousand), medium- to long-term loans granted by banks (â,¬5,967 thousand) and lease payments on property (â,¬184,255...

  • Page 356
    ... by citibank to the Group's Indian subsidiaries New Holland Fiat (India) Private Ltd. and comau India Private Limited. As at 31 December 2010 (as also at 31 December 2009) these credit facilities were unutilized; in 2005, in relation to the early collection by Fiat Partecipazioni S.p.A. of the...

  • Page 357
    ... liquidity based on business planning. management believes that the funding currently available, in addition to those funds that will be generated from operating and funding activities, will enable the Group to satisfy the requirements of its investing activities and its working capital needs and to...

  • Page 358
    ... amounts payable to Fiat Finance S.p.A. and liabilities related to advances on the sale of receivables to banks (see Note 25). In addition, non-current financial payables to Fiat Finance S.p.A. (see Note 21) include variable rate loans. The cost of these items is affected by changes in short-term...

  • Page 359
    ... Automobiles S.p.A. Fiat Automoveis S.A. - FIASA Fiat Finance canada Ltd. Fiat Finance S.p.A. Fiat Finance and Trade Ltd S.A. Fiat France Fiat Services S.p.A. Fiat Group marketing & corporate comm. S.p.A. Fiat Group Purchasing S.r.l. Fiat Partecipazioni S.p.A. Fiat Polska S.p. z.o.o. Fiat Powertrain...

  • Page 360
    ...Sirio S.c.p.A. Other Group companies IRES tax consolidation VAT consolidation Financial guarantee contracts Total Group companies Other related parties Total Group companies and other related parties Total line item Percentage of line item Trade recs. 56 207 263 79 342 8,078 4% Trade pays. 151 783...

  • Page 361
    ... S.p.A. Fiat Group Automobiles S.p.A. Fiat Finance canada Ltd. Fiat Finance S.p.A. Fiat Group marketing & corp. c. S.p.A. Fiat Group International S.A. Fiat Group Purchasing S.p.A. Fiat Item S.p.A. Fiat Polska S.p. z.o.o. Fiat Powertrain Technologies S.p.A. Fiat-Revisione Interna S.c.r.l. Fiat...

  • Page 362
    ... cNH Global N.V., Fiat Finance canada Ltd., Fiat Finance North America Inc., Fiat Automoveis S.A.- FIASA and other minor subsidiaries), property rental payments (Fiat Group Automobiles S.p.A. and its subsidiaries) and to tax authorities for Group company VAT credits; management of current accounts...

  • Page 363
    ... approval and a commitment to produce an engine based on Fiat's FIRE family in the USA) stipulated in the alliance agreement. On 9 February 2011, moody's Investors Service completed the review of Fiat S.p.A.'s rating for possible for downgrade initiated on 21 July 2010. Fiat S.p.A.'s long-term...

  • Page 364
    ... value (â,¬) 4,474,081,024 1,050,000,000 5,524,081,024 1,055,203,823 1,055,203,823 103,798,379 103,798,379 Company and registered office Fiat Group Automobiles S.p.A. - Turin At 31.12.09 capital contribution At 31.12.10 Ferrari S.p.A - modena At 31.12.09 At 31.12.10 Maserati S.p.A. - modena At 31...

  • Page 365
    364 FIAT S.P.A. STATUTORY FINANCIAL STATEMENTS AT 31 DECEMBER 2010 NOTES List of equity investments (continued) Company and registered office Comau S.p.A. - Grugliasco At 31.12.09 capital contribution impairment At 31.12.10 Fiat Partecipazioni S.p.A. - Turin At 31.12.09 At 31.12.10 Share Capital...

  • Page 366
    ... Share Capital (*) (â,¬) 11,682,632 16,830,000 12,595,420 16,830,000 Result for the latest financial year (*) (â,¬) (24,869) (35,827) (25,650) (34,273) Equity (*) (â,¬) 23,843,010 34,348,240 25,680,263 34,313,967 % owned by Fiat S.p.A. 100.00 100.00 Number of shares 1,000 1,000 Book value...

  • Page 367
    ....09 At 31.12.10 (*) Total associate companies Number of shares 76,907,627 76,907,627 (*) Figures taken from the 2008 and 2009 Separate Financial Statements Other companies Company and registered office Assicurazioni Generali S.p.A. - Trieste At 31.12.09 fair value adjustment At 31.12.10 Fin.Priv...

  • Page 368
    ...,091.0 11) year in which term of office expires at General meeting held to approve the financial statements. includes the use of transport for personal purposes. includes 16 executives employed as at 31 December 2010 and 2 executives who left the Group during the year. Gross annual compensation for...

  • Page 369
    368 FIAT S.P.A. STATUTORY FINANCIAL STATEMENTS AT 31 DECEMBER 2010 NOTES STOCK OPTIONS GRANTED TO MEMBERS OF THE BOARD OF DIRECTORS, GENERAL MANAGERS AND EXECUTIVES WITH STRATEGIC RESPONSIBILITIES (ARTICLE 78 OF CONSOB REGULATION 11971/99) Options expired in the year Grantee Office held at the ...

  • Page 370
    ... information see Note 19 to Fiat S.p.A. financial statements. (2) consists of a Performance Share grant with final vesting upon approval of 2014 Financial Statements. Earlier partial vesting may occur after the 2012 and 2013 full year results. 18 February 2011 On behalf of the Board of Directors...

  • Page 371
    ... of Fiat S.p.A.'s statutory financial statements for the six months ended 30 June 2010 and limited audit of Fiat S.p.A.'s consolidated financial statements for the quarter and nine months ended 30 September 2010 for the purpose of disclosures required in relation to the Demerger. Attestation of tax...

  • Page 372
    ... 2010 and for the year then ended. 3.2 The report on operations includes a reliable operating and financial review of the company as well as a description of the main risks and uncertainties to which it is exposed. 18 February 2011 /s/ Sergio marchionne Sergio marchionne CHIEF EXECUTIVE OFFICER...

  • Page 373

  • Page 374
    373 AUDITOR'S REPORTS

  • Page 375
    ..., the statement of cash flows and the related notes to financial statements. These consolidated financial statements prepared in accordance with International Financial Reporting Standards ("IFRS") as adopted by the European Union and the requirements of national regulations issued pursuant to art...

  • Page 376
    ... our opinion, the consolidated financial statements of the Fiat Group as of and for the year ended 31 December, 2010 comply with International Financial Reporting Standards as adopted by the European Union and the requirements of national regulations issued pursuant to art. 9 of Italian Legislative...

  • Page 377
    ... our opinion, the statutory financial statements of Fiat S.p.A. as of and for the year ended 31 December, 2010 comply with International Financial Reporting Standards as adopted by the European Union and the requirements of national regulations issued pursuant to art. 9 of Italian Legislative Decree...

  • Page 378
    ...b) included in the annual report on corporate Governance are consistent with the financial statements of Fiat S.p.A. as of and for the year ended 31 December, 2010. DELOITTE & TOUCHE S.p.A. /s/ colin Johnston colin Johnston Partner Turin, Italy 21 February 2011 This report has been translated into...

  • Page 379

  • Page 380
    379 REPORTS OF THE BOARD OF STATUTORY AUDITORS

  • Page 381
    ... that: "the consolidated financial statements of the Fiat Group as of and for the year ended 31 December 2010 comply with International Financial Reporting Standards as adopted by the European Union and the requirements of national regulations issued pursuant to art. 9 of Italian Legislative Decree...

  • Page 382
    ... that the company conformed with management best practice. A group-wide internal control system, which is constantly upgraded, is in place both for Fiat S.p.A. and subsidiaries. We evaluated and monitored the adequacy of the internal control system and the administrative and accounting system, as...

  • Page 383
    ... to the laws of a non-EU member state, we report that - at 31 December 2010 - the companies to which that provision applies are included among those companies considered relevant for the purposes of Fiat's system of internal control over financial reporting, in relation to which no deficiencies have...

  • Page 384
    ... the company and other Group companies, as well as related parties. The report on operations further states that these transactions were executed at standard market terms for the nature of the goods and/or services offered. In that regard, we report that on 21 October 2010, the board of Directors...

  • Page 385
    ... centralized treasury services to Fiat Group and Fiat Industrial Group. The above to be executed while guaranteeing both structures, along with the necessary separation, use of the current procedures, the existing levels of operating security, automation and connectivity with the banking system and...

  • Page 386
    ... to: the alleged ambiguity and contradiction in the press release issued by Fiat on march 24th in relation to comments appearing in the daily newspaper La Repubblica regarding a supposed spin-off of the auto business and plan for employee redundancies. That statement was alleged to be ambiguous and...

  • Page 387
    ... December 2010, have found no evidence of improper conduct. In relation to the complaint brought by bava under Article 2408 of the civil code asking to be informed of the amount earned by the lawyer mr. Anfora for his services to Fiat, given that mr. Anfora was representing the company in a dispute...

  • Page 388
    ... of positions as director or statutory auditor held by members of the board of Statutory Auditors at other companies at 31 December 2010 (pursuant to Article 144-quinquiesdecies of the Issuer Regulations). For each position, term of office expires upon approval of financial statements for the year...

  • Page 389

  • Page 390
    389 AGENDA AND RELATED REPORTS AND MOTIONS

  • Page 391
    ... AGENDA AND RELATED REPORTS AND MOTIONS MOTION FOR APPROVAL OF THE STATUTORY FINANCIAL STATEMENTS AND ALLOCATION OF 2010 PROFIT Dear Shareholders, We hereby submit the Statutory Financial Statements for the year ended 31 December 2010 for your approval and propose that the profit for the year of...

  • Page 392
    ... 2011, Fiat S.p.A. owned 38,568,458 ordinary shares, equal to 3.02% of share capital. No other Group company owned Fiat shares. The maximum and minimum purchase price per share shall be directly related to the market price - specifically, the reference price reported by the Stock Exchange on the day...

  • Page 393
    ...incentive plans for directors and executives, as well as any additional plans that may be established by the board in the future and subsequently submitted for the approval of Shareholders. In such an event, the shares shall be sold at the prices set when the rights are granted. 18 February 2011 On...

  • Page 394
    ... mandate as independent auditors, approved by Shareholders on 3 may 2006, will expire with the issue of their report on the statutory financial statements for the year ended 31 December 2011 and, pursuant to law, is no longer renewable. The board of Directors hereby submits the recommendation of...

  • Page 395
    ... it important to also take the level of proposed fees into account. The board of Statutory Auditors, therefore, proposes that Reconta Ernst & Young S.p.A. be appointed as the company's independent auditors for the nine-year period 2012-2020. The firm estimates that, in relation to Fiat S.p.A. and...

  • Page 396
    ... Statutory Auditors" Dear Shareholders, We propose that you approve the motion for appointment of the independent auditors for the nine-year period 1 January 2012 - 31 December 2020, as proposed by the board of Statutory Auditors. 18 February 2011 On behalf of the Board of Directors /s/ John Elkann...

  • Page 397
    CONTACTS Head Office Via Nizza, 250 - 10126 Turin (Italy) Tel. +39 011 00 61 111 web site: www.fiatspa.com Investor Relations Tel. +39 011 00 62 709 Fax +39 011 00 63 796 e-mail: [email protected] Sustainability Tel. +39 011 00 63 908 e-mail: [email protected] Press Office Tel...

  • Page 398
    ... kg of CO2 6,464 kWh of energy 4,307 km travel in the average European car 3,888 kg of wood Fiat S.p.A. offsets the GHG emissions from paper used to print its Annual Report, Sustainability Report and corporate Governance Report. The total of 17 tons in cO2 emissions will be offset by a forestry...

  • Page 399
    Illustrations and creative design Atelier Roger Pfund, communication visuelle S.A. Geneva, Switzerland Graphic design In Adv + Sunday Turin, Italy Editorial coordination Sunday Turin, Italy Printing Stamperia Artistica Nazionale Trofarello (TO), Italy Printed in Italy march 2011

  • Page 400

  • Page 401

  • Page 402
    Fiat S.p.A. Registered Office: 250 Via Nizza, Turin, ITALY Share capital: â,¬4,464,812,520 Turin companies Register/ Tax code: 00469580013