0Exane BNP Paribas European Seminar – June 14, 2007
1Exane BNP Paribas European Seminar – June 14, 2007
Certain information included in this document is forward looking and is subject to important risks and uncertainties that could cause actual results to differ materially. Among these factors are those risks identified in the Company’s most recent Annual Report on Form 20-F filed with the U.S. Securities and Exchange Commission (the “SEC”). The Company’s businesses include its automotive, automotive-related and other sectors, and its outlook is predominantly based on its interpretation of what it considers to be the key economic factors affecting these businesses. Forward-looking statements with regard to the Group’s businesses involve a number of important factors that are subject to change, including: the many interrelated factors that affect consumer confidence and worldwide demand for automotive and automotive-related products; factors affecting the agricultural business including commodities prices, weather, and governmental farm programs; general economic conditions in each of the Group’s markets; legislation, particularly that relating to automotive-related issues, agriculture, the environment, trade and commerce and infrastructure development; actions of competitors in the various industries in which the Group competes; production difficulties, including capacity and supply constraints and excess inventory levels; labor relations; interest rates and currency exchange rates; political and civil unrest; and other risks and uncertainties.
Safe Harbor Statement
Exane BNP Paribas European Seminar – June 14, 2007
From Transformation to Growth
Sergio MarchionneChief Executive
3Exane BNP Paribas European Seminar – June 14, 2007
A Different Fiat – and the Journey Goes onRevenues (€bn) & Trading Margin
45.644.5 46.551.8
(1.6%)
0.0%
3.8%
2.1%
2003 2004 2005 2006
All financial targets met or exceeded
2004-2006 data under IAS/IFRS (2003 Italian GAAP from Continuing Operations)
Our commitment to the future
~58~54
~63~67
4.5%
5.9%
7.2%6.7%
7.8%7.3%
6.5%
5.1%
2007E 2008E 2009E 2010E
Trading margin range - Low Trading margin range - High
From transformation ... ... to growth
4Exane BNP Paribas European Seminar – June 14, 2007
Agricultural andConstruction Equipment
5Exane BNP Paribas European Seminar – June 14, 2007
Agricultural and Construction EquipmentCompetitive Comparison (US GAAP) – Narrowing the Gap
Ind
ust
rial O
pera
tin
g R
esu
lt(u
s$ m
n)
Return on Industrial Sales (%)
JOHN DEERE
CAT MACHINERY
AGCO
Significant business growth and profitability improvement
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4.0 6.0 8.0 10.0 12.0
Size of circle based on Sales
2005
2006
2007 Target
6Exane BNP Paribas European Seminar – June 14, 2007
7.0%
FY '06 FY '07E
Significant volume growth in both Agricultural & Construction Equipment, boosted by industry growth in most key markets
Market share gain for all brands, driven by key product launches, dealer network confidence & customer-focused initiatives
Brand unbundling successful in repositioning core product lines & addressing target customers, with strong effort on brand promotion
Service excellence thanks to several new initiatives - dealer training, customer care & financial services
Margin enhancement driven by improved product mix & price positioning, increased after-sales penetration & Group cost synergies
14.0*13.2
FY '06 FY '07E
Agricultural and Construction EquipmentBrands Gaining Ground
FY ’07 Target8.9%/9.7%
Net Revenues ($bn)
Trading Profit ($mn)
925
* According to 2007–10 Plan
7Exane BNP Paribas European Seminar – June 14, 2007
Agricultural and Construction Equipment2007 Main Product Launches Aligned with Brand Positioning
Launched in Q1 ‘07
Fills hole in Case IH product line in 240-280 hp category, fastest-growing segment in NA combine industry
Launched in Q1 ‘07
New product replacement for large hay & forage, livestock and specialty vegetable farmers – core of NH line-up for NA and WE
Use of common components keeps costs downNew Holland
T6000-T7000 (mid-to-high hp tractor)
Case IH
Axial-Flow 7010 Class 7 combine
CaseE Series Wheel Loader Tier 3
New HollandB Series Crawler Excavator Tier 3
Launched in NA and WE in Q1 ‘07, LA & ROW to follow this year
Better pricing, aligned to top competitors’
Best-in-class serviceability & maintainability
Launched in Q2 ‘07
Flagship product line, representing about one-third of Construction Equipment market and 40% of brand revenues
Target markets: primarily NA and WE
8Exane BNP Paribas European Seminar – June 14, 2007
• Establish preferred brand positioning with dealers and customers
• Increase penetration of CNH units financed & expand utilization of credit card, consumer & insurance products
• Drive operational efficiencies through investment in loan origination system
• Expand product & market offering
• Regain historical positions in global markets & improve capacity utilization
• Improve quality & reliability to “Best-in-Class” levels
• Add resources & training to dealer & customer support
• Grow parts business with emphasis on availability, service and after-sales excellence
• Leverage alliances and expansion in emerging markets
• Reduce corporate structure costs
Financial Services
Equipment Operations
Agricultural and Construction Equipment2007-10 Plan Drivers
9Exane BNP Paribas European Seminar – June 14, 2007
Trucks and CommercialVehicles
10Exane BNP Paribas European Seminar – June 14, 2007
Return on Industrial Sales (%)
Trucks and Commercial VehiclesMoving Fast towards Double-Digit Margin (IFRS)
Light CV 3.5-6T
1. Mercedes 17.4%2. Iveco 17.1%
Medium CV
1. Mercedes 28.0%2. Iveco 25.4%
Heavy CV
1. Mercedes 20.5%6. Iveco 10.9%
FY ’06WE Market Share
* Excludes powertrains (inclusion improves margins by 0.5 pts.)
0
500
1,000
1,500
2,000
2,500
3.0 5.0 7.0 9.0 11.0 13.0
MERCEDES
VOLVO
PACCAR
SCANIAMAN
*
Ind
ust
rial O
pera
tin
g R
esu
lt(€
mn)
Size of circle based on Sales
2005 2006 2007 Target
11Exane BNP Paribas European Seminar – June 14, 2007
6.0%
FY '06 FY '07E
9.1 ~ 9.0*
FY '06 FY '07E
Trucks and Commercial VehiclesPrice Repositioning & Volume Effect Driving Revenues Up
Net Revenues (€bn)
Trading Profit (€mn) & Margin
FY ’07 Target7.1%/7.9%
WE market still growing in
H1 ’07, expected to decline
slightly in H2
WE market share at 11.0%
in 2007, leveraging on new
products
Trading margin up on
pricing & product cost
efficiency
Recovering gap vs. best
competitors’ profitability
546
* According to 2007–10 Plan
12Exane BNP Paribas European Seminar – June 14, 2007
Trucks and Commercial VehiclesProduct Highlights
New DailySince successful mid-2006 launch, more than 110k orders collected
40k units sold as of May YTD
Full-year sales target: 100k units
4x4 version to be launched in Q3 ‘07
New StralisOfficial launch in Rome last March
Nearly 11k orders taken as of May YTD
Target of 25-30k units on a full-year basis
Brand repositioning, leveraging on product performances and quality focus
13Exane BNP Paribas European Seminar – June 14, 2007
Full line of highly competitive, modern products
2007: New Stralis/Trakker heavy product range
2008: Renewal of Eurocargo medium range
2009: Launch of new basic medium truck family leveraging future Yuejin range from China
Repositioning brand, particularly leveraging the success of the Stralis range
State-of-the-art engine range with fuel consumption leadership, easily upgradeable to Euro 6
Leveraging CNH/Iveco volumes for material cost efficiencies
Strong sales & service network
Increased R&D to drive global product platforms
Global expansion through targeted alliances
Positioned for steady profit improvement
Trucks and Commercial Vehicles2007-10 Plan Drivers
14Exane BNP Paribas European Seminar – June 14, 2007
Fiat Group Automobiles
15Exane BNP Paribas European Seminar – June 14, 2007
Fiat Group Automobiles2007 Outlook
Western Europe* market stable vs. 2006 with contrasting trend
(Italy up, UK & France flat, Spain & Germany down)
Brazilian passenger car market up sharply (1.8/1.9mn units)
220k additional units vs. 2006 thanks to launch of new products
driving market share gains
Italy from 30.7% to >32%
WE from 7.6% to >8%
Brazil share stable at >25%
LCV market share up at 11.5% in WE; Brazil stable at 26%
Additional spending in advertising, marketing & network support
related to European activities
* 15EU + EFTA
16Exane BNP Paribas European Seminar – June 14, 2007
291
1.2%
23.725.5*
FY '06 FY '07E
FY ’07EFY ‘06
FY ’07 Target2.1%/2.9%
Net Revenues (€bn)
Trading Profit (€mn) & Margin
Fiat Group AutomobilesHighest Unit Volumes Since 2001
Units up 11% to 2.2 million in ‘07
Higher passenger car volume driven by Fiat brand
Commercial vehicles up 12%
Revenues up 11% on a comparable basis
Western Europe
Unit sales up 11% (PC & LCV)
Share gains across all major markets
Target to be solidly established among top 5 automakers
Trading profit positive since Q4 ‘06 in Europe
Brazil
Maintain market leadership
Sound profitability
* According to 2007–10 Plan
17Exane BNP Paribas European Seminar – June 14, 2007
Fiat Group AutomobilesFiat Bravo: Successfully Developed in 18 Months from Design Freeze
European launches in major countries
Broadening competitive gas engine offer:
1.4 T-Jet 150cv (end of June)
1.4 T-Jet 120cv (Q3 ’07)
’07 target: 70K units; ’08 target: 120K units
45k orders & 29k units sold as of May YTD
ItalyJan 31
FranceMar 17
SpainApr 19
GermanyApr 21
UKJun 30
Le réveil de l’automobile italienne
Bravo ”best built hatch”
18Exane BNP Paribas European Seminar – June 14, 2007
Designed to play in core emerging markets and
selected European countries
New sedan offer derived from existing platform
Worldwide component standardization to maximize
economies of scale
Optimized local market differentiation requirements
through range of versions and powertrains
Five production sites by 2012
280k sale target at steady state
Initial production in Turkey (capacity at 60k/year),
Brazil, India, China, Russia to follow
~€500mn overall investment
Fiat Group AutomobilesFiat Linea: Latest-generation Technology at Affordable Price
19Exane BNP Paribas European Seminar – June 14, 2007
Fiat Group AutomobilesFiat 500: The Brand Flavor-enhancer
The quintessential iconic product with Italian design
Launch brought forward to July 4, 50th anniversary of original “500”introduction
Sales target
58k in ‘07
120k on a full-year basis
~€120mn or 40% savings vs. original standalone development scenario from architecture sharing and joint production with Ford
20Exane BNP Paribas European Seminar – June 14, 2007
Alfa 159FY ’07 target95k units
May YTD34k orders28k units sold
Fiat Group AutomobilesA Model Snapshot
PandaFY ’07 target250k units
May YTD154k orders124k units sold
Grande PuntoFY ’07 target360k units
May YTD165k orders145k units sold
New YpsilonFY ’07 target80k units
May YTD37k orders33k units sold
New ScudoFY ’07 target40k units
May YTD18k orders16k units sold
21Exane BNP Paribas European Seminar – June 14, 2007
Strengthening market share in WE
Continued emphasis on (& financial commitment to) development of
dealer network (specific action plan for Alfa & Lancia)
Leveraging joint-ventures & partnerships to grow in markets outside
Europe and Brazil
Sufficient, optimized Capex & R&D spend to assure growth
Architecture convergence & component standardization to leverage
economies of scale
Continued push on technical & purchasing savings
Full utilization of plant capacity
Continuous focus on quality & customer services
Continued streamlining of governance costs to align business
structure to market demand
Fiat Group Automobiles2007-10 Plan Drivers
22Exane BNP Paribas European Seminar – June 14, 2007
Conclusions
23Exane BNP Paribas European Seminar – June 14, 2007
(a) Assuming dividend pay-out at a rate of 25% of annual net income (~€2.0bn over period 2007-10)
(b) Cash Flow from operations(c) Incl. Italenergia Bis: €1.8 bn; Real estate: €0.2 bn; GM settlement
net of assumed Powertrain debt: €1.1 bn
2004-10 PlanGroup Financial Targets
2004 2008
Group TradingProfit/Margin
Group Net Income
€3.4-3.6bnEPS €2.65/2.80
Group Net Industrial
Debt (a)
~€5.0bn7.2%-7.8%
<1bn
ex buy-back
2009 2010
€4.3-4.5bn6.7%-7.3%
€3.4-3.6bn5.9%-6.5%
€2.5-2.7bn4.5%-5.1%
€1.6-1.8bnEPS €1.25/1.40
€2.4-2.6bnEPS €1.90/2.00
€2.9-3.1bnEPS €2.30/2.40
Nearlydebtfree
Net cash ~€3.0bn
Net cash€0.7-1.0bn
2005 2006 2007
2005-10 CAGR 7.6% ~€67bn
Group break-even
1.92:1 net debt to Group equity
€1.6bn net loss
Net incomeof €1.4bn due to unusual items
2% trading margin
0.34:1 net debt to Group equity
Net incomeof ~ €800mn
Trading profit of~ €1.85bn
Net industrial debt at ~€2.0bn
GroupRevenues
Net ind. cash flow of €3.4bn due to unusuals(c)
GroupCash Flow (b)
Neg. cashflow before exceptionals significantly reduced
Net IndustrialCash flow of~ €1.2bn
~€47bn
24Exane BNP Paribas European Seminar – June 14, 2007
Revenues up sharply across all main sectors
Auto growth in line with FY volume targets
CNH up 10.6% in US dollar terms
Iveco best Q1 ever
FPT & Magneti Marelli performing well, on both Group & third-party business
Group trading profit up 84% to €595mn; 4.4% trading margin vs.
2.6% in Q1 ’06, on 8.9% revenue growth to €13.7bn
Automobiles: trading profit more than quadrupled to €222mn on higher volumes, better mix; trading margin at 3.3% vs. 0.8% in Q1 ’06
Iveco: trading profit up €80mn to €150mn on 20% revenue increase; margin nearly doubled to 6%
CNH: trading profit up 50% in dollar terms, margin up from 5.2% to 7.0%
Good performances at FPT & Magneti Marelli
Net income of €376mn, up €225mn (+149%)
Good industrial cash flow generation (~€500mn)
Q1 ‘07One Down, Fifteen to Go
25Exane BNP Paribas European Seminar – June 14, 2007
Leading Fiat
We are a meritocracy
Leadership is a function of leading change & leading people
We embrace & cherish competition
We aim to achieve world-class performance
We deliver what we promise
We set ambitious but reachable targets for the 2007-10 period
Based on thorough analysis of past issues, recent achievements and competitive positioning of the businesses
Embraced by the organization
Backed by broad-based executive stock option plan
A solid foundation upon which to build a goal-driven house
26Exane BNP Paribas European Seminar – June 14, 2007
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