Chrysler 2015 Annual Report Download - page 34

34 2015 | ANNUAL REPORT
Our Business Plan
Our Business Plan
In May 2014, we announced our 2014-2018 Business Plan, which focused on: strengthening and differentiating
our portfolio of brands, including the globalization of Jeep and Alfa Romeo; volume growth; continued platform
convergence and focus on cost efficiencies, as well as enhancing margins and strengthening our capital structure.
We presented an update to our Business Plan in January 2016 in order to address intervening market changes and
announced the following actions:
Due to a continued shift in consumer preference towards utility vehicles and pickup trucks in the NAFTA region, we
intend to realign our installed capacity in the region to better meet demand for Ram pickup trucks and Jeep vehicles
within our existing plant infrastructure by discontinuing production of our Chrysler 200 and Dodge Dart passenger
cars. As a result, we recorded a total charge of €834 million as described in more detail within the section —Results
by Segment - NAFTA below. We intend to maintain our presence in the market for passenger cars through other
arrangements.
We intend to slow the pace of our investments in the Alfa Romeo brand and the timing of future product launches,
primarily in response to reduced demand for premium and imported vehicles in China.
The commencement of production at our new Pernambuco plant has coincided with a significant industry decline,
intensified competitive pressures from non-major OEMs, and currency devaluation pressures in the LATAM region.
As a result, we are offsetting inflation with pricing actions and we intend to explore opportunities to export vehicles
produced in Brazil without an impact on our Pernambuco strategy.
Based on the Jeep brand’s significant volume growth across all regions and nameplates over the past six years, we
have increased our expectations for the brand’s future growth.
Notwithstanding these market changes and the actions described above, we have stated our intent to deliver positive
operating cash flows for each remaining year of the Business Plan and reiterated our goal to achieve a net industrial
cash position by the end of 2018.