Chrysler 2015 Annual Report Download - page 53

2015 | ANNUAL REPORT 53
Selling, general and administrative costs
For the Years Ended December 31, Increase/(decrease)
(€ million, except percentages) 2015
Percentage
of net
revenues 2014
Percentage
of net
revenues 2013
Percentage
of net
revenues 2015vs.2014 2014 vs. 2013
Selling, general and
administrative costs 7,728 7.0% 6,947 7.4% 6,615 7.8% 781 11.2% 332 5.0%
2015 compared to 2014
Selling, general and administrative costs include advertising, personnel, and other costs. Advertising costs accounted
for approximately 46 percent and 45 percent of total selling, general and administrative costs for the year ended
December31, 2015 and 2014 respectively.
The increase in Selling, general and administrative costs in 2015 compared to 2014 of €781 million (1.9 percent at
CER) was due to the combined effects of (i) foreign currency translation primarily resulting from the strengthening of
the U.S.$ against the Euro of approximately €650 million, (ii) commercial launch costs related to the all-new 2015
Jeep Renegade and start-up costs for the Pernambuco plant in the LATAM segment totaling €104 million and (iii) an
increase of €42 million in advertising expenses for the EMEA segment for the all-new 2015 Jeep Renegade and Fiat
500X, which was partially offset by (iv) lower marketing expenses in APAC.
2014 compared to 2013
The increase in Selling, general and administrative costs in 2014 compared to 2013 of €332 million (6.0 percent at
CER) was due to the combined effects of (i) a €293 million increase in advertising expenses driven primarily by the
NAFTA, APAC and EMEA segments, (ii) a €157 million increase in other Selling, general and administrative costs
primarily attributable to the LATAM and Maserati segments, and to a lesser extent, the APAC segment which were
partially offset by (iii) a reduction in other general and administrative expenses in the NAFTA segment and (iv) the
impact of foreign currency translation of €68 million.
The increase in advertising expenses was largely attributable to the APAC and NAFTA segments to support the
growth of the business in their respective markets. In addition, advertising expenses increased within the NAFTA
segment for new product launches, including the all-new 2014 Jeep Cherokee and the all-new 2015 Chrysler 200.
There were additional increases in advertising expenses for the EMEA segment related to the Jeep brand growth and
new product launches, including the all-new 2014 Jeep Cherokee and Renegade. The foreign currency translation
impact of €68million was primarily attributable to the LATAM segment, driven by the weakening of the Brazilian Real
against the Euro.
The increase in other Selling, general and administrative costs attributable to the Maserati segment has been driven
by the increase in volumes. The increase in other selling, general and administrative costs attributable to the APAC
segment was driven by volume growth in the region, while the increase in the LATAM segment includes the start-up
costs of the Pernambuco plant.