Chrysler 2010 Annual Report Download - page 8

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At the beginning of 2011, our stake in Chrysler increased from 20% to 25% following achievement of the first of three Performance Events that will ultimately allow Fiat to achieve a
35% ownership of Chrysler Group.
But apart from these technical and financial matters, one of the most valuable results of this alliance is occurring at the cultural level.
Fiat and Chrysler are undertaking a cultural integration based on mutual respect and humility whose starting point is a spirit of equality and the willingness of each partner to learn
from the other.
Today we have an extraordinary group of people working alongside each other, listening, exchanging ideas, and expanding their horizons.
Two cultures are merging.
This is the true strength of our partnership and we believe the most precious part, whose value lies in the incredible human wealth created for our companies and the development
of our people.
With regard to near to medium targets, we have laid out a detailed development plan for Fiat and Fiat Industrial that was presented to the international financial community on 21
April 2010.
The financial targets reflect our aspiration to deliver strong topline growth, together with robust improvements in profitability.
We project the post-demerger Fiat will achieve 2011 revenues of €37 billion, growing to €64 billion by 2014.
The steady improvement in trading profit and margins reflects our commitment to eliminating the handicaps that have been a drag on our business in Europe, optimizing synergies
and transforming Fiat into a best-in-class competitor.
For Fiat Industrial, the plan targets revenues of around €22 billion for 2011 and nearly €30 billion in 2014, representing an average annual growth rate of 8%.
Trading profit will also increase significantly and is projected to reach €3.3 billion in 2014.
To support the growth of the two groups and new product development, we plan to invest about €30 billion over the plan period, including almost €2 billion a year in research.
For the auto business in particular, where the most significant portion of those investments will be made, the 5-year plan calls for renewal of our product portfolio with the launch of
34 new models and 17 major product interventions.
Due to the prevailing weak market conditions, in 2010 we made the strategic decision to limit new product launches, scheduling them to recommence from the second half of 2011.
The overall plan represents a significant commitment to invest in expanding our product offer and improving our competitive position in Europe.
As we work to achieve these objectives, our decisions will be directed at balancing the need for industrial efficiency with the sense of social responsibility that has guided Fiat this far
and become part of its DNA.
We demonstrated this commitment to Italy when we presented a project that aims to make our production more competitive, while at the same time providing our people with a
more certain future.
We are also demonstrating that commitment elsewhere in the world, through development based on the very same values we applied in rebuilding Fiat: integrity, transparency and
a responsible approach to business.
These values have been recognized and appreciated internationally.
In 2010, we were one of the few auto sector companies included in the prestigious Dow Jones Sustainability Index that is comprised of only those companies considered to be
leaders in sustainability.
We consider this an important achievement, not just for the image that it portrays, but because it provides concrete proof that there is a system of values that drive the delivery of our
results.
These values have made Fiat a solid organization where commitment and a sense of duty are the bedrock of what we do.
These strong principles are firmly embedded in our organization and form an integral part of who we are as leaders, because we live them as individuals even more than as managers.
We leave 2010 behind with a sense of accomplishment.
The demerger and the strengthening of the alliance with Chrysler have indelibly and irreversibly changed Fiat.
We have grown these businesses together for more than 100 years to the point where their togetherness had become a matter of custom and comfort.
We have decided to break away from this comfort and tradition in order to set the stage for the next stage of development of our businesses.
Fiat and Fiat Industrial start their new lives in 2011 with a renewed sense of purpose and direction. Financially strong and well equipped technologically and industrially, they are
embarking on a project of international exploration, each distinct, but taking their respective know-how and experience around the world with a clear objective of becoming vibrant
global competitors.
We thank our shareholders for having been patient partners on this journey and for staying with us as Fiat and Fiat Industrial stakeholders in the next phase of our development.
18 February 2011
/s/ John Elkann /s/ Sergio Marchionne
John Elkann Sergio Marchionne
CHAIRMAN CHIEF EXECUTIVE OFFICER