European Fixed Income Investors. June 13, 2011

Transcription

1 European Fixed Income Investors June 13, Novembre, 2010

2 Disclaimer This presentation is for information purposes only and does not constitute an offer of securities in any jurisdiction including the United States. Securities may not be offered or sold in the United States unless such offer and sale is registered with the U.S. Securities and Exchange Commission or exempt from or not subject to the registration requirements of the U.S. Securities Act of 1933, as amended. Fiat S.p.A. ( Fiat, together with its subsidiaries, the Group ) does not intend to register its securities for offer and sale in the United States or to conduct a public offering of its securities in the United States. This presentation is not for dissemination or publication in the United States. The distribution of this presentation in other countries may be subject to legal restrictions and persons into whose possession this presentation comes should inform themselves about, and observe, any such restrictions. This presentation is only being provided (A) in the European Economic Area, to persons who are qualified investors within the meaning of the Prospectus Directive (Directive 2003/71/EC, and amendments thereto, including Directive 2010/73/EC, to the extent implemented in the relevant Member State) ( Qualified Investors ); and (B) in Italy, (i) to qualified investors (investitori qualificati), pursuant to Article 100 of Legislative Decree No. 58 of February 24, 1998, as subsequently amended (the Italian Finance Act ), as implemented by Article 34 ter of CONSOB Regulation No of May 14, 1999, as subsequently amended (the Regulation on Issuers ) with the exception of: (a) asset management companies authorized to manage individual portfolios on behalf of third parties (società di gestione del risparmio); (b) intermediaries authorized to manage individual portfolios on behalf of third parties; (c) fiduciary companies managing portfolio investments regulated by Article 60(4) of the Legislative Decree No. 415 of July 23, 1996, as amended and in accordance with applicable Italian laws and regulations provided therein (società fiduciarie); and (d) small/medium-sized companies with registered office in Italy and individuals resident in Italy, enrolled in the Register of individuals and small/medium-sized companies considered to be qualified investors (envisaged by Article 34-quarter of the Regulation on Issuers); or (ii) in circumstances which are exempt from the rules on public offers pursuant to the Italian Finance Act and its implementing CONSOB regulations, including the Regulation on Issuers. By attending this presentation or by reading the presentation slides you warrant and acknowledge that you are a person who falls within the above restrictions. No representation or warranty, express or implied, is or will be made in relation to, and no responsibility is or will be accepted by Fiat as to, the accuracy or completeness of the information contained in this presentation. No part of this presentation constitutes, or shall be taken to constitute, an invitation or inducement to invest in Fiat in any jurisdiction in which registration or qualification of such securities is required under applicable law. June 13, 2011 European Fixed Income Investors 2

3 Safe Harbor Statement Certain information included in this presentation, including, without limitation, any forecasts included herein, is forward looking and is subject to important risks and uncertainties that could cause actual results to differ materially. The Group 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, but not limited to: the many interrelated factors that affect consumer confidence and worldwide demand for automotive and automotive- related products; governmental programs; general economic conditions in each of the Group's markets; legislation, particularly that relating to automotive- related issues, 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; earthquakes and other risks and uncertainties. Any forward- looking statements contained in this presentation are made as of the date of this presentation and, therefore, any of the assumptions underlying this presentation or any of the circumstances or data mentioned in this presentation may change. Fiat expressly disclaims and does not assume any liability in connection with any inaccuracies in any of these forward- looking statements or in connection with any use by any third party of such forward- looking statements. This presentation does not represent investment advice or a recommendation for the purchase or sale of financial products and/or of any kind of financial services. Finally, this presentation does not represent an investment solicitation in Italy, pursuant to Section 1, letter (t) of Legislative Decree no. 58 of February 24, 1998, as amended, nor does it represent a similar solicitation as contemplated by the laws in any other country or state. The data related to Chrysler Group LLC were derived from public information related to Chrysler Group LLC and independently prepared by Chrysler Group LLC and are subject to any disclaimers set forth in the public statements of Chrysler from which they were derived. June 13, 2011 European Fixed Income Investors 3

4 Structure of demerger transaction Effective January 1, classes of shareholders Fiat SpA ~90% CNH Iveco FPT Auto Components Other Assets I&M P&CV 3 classes of shareholders Auto Components Other Assets ~90% 3 classes of shareholders CNH Iveco FPT Industrial 1 Fiat Group Automobiles One of pioneers of European passenger car & LCV industry, bringing Italian spirit to the world for more than a century International company committed to the design and production of hi-tech systems and components for automotive sector Includes publishing (La Stampa, Publikompass and stake in RCS) services and other minor interests FGA Capital, a JV with Credit Agricole specialized in motor financing sector in Europe A 37.9% interest stake in Tofas, Turkey's leading automotive company Interest stake in Chrysler Group LLC, forming a global alliance Ferrari Exclusive cars without compare 2 Specialized in and dedicated to research, development, production and sale of engines & transmissions for automotive applications Leading manufacturer of metal components Innovative global provider of sustainable automation and services solutions Maserati 1. Includes activities of Industrial & Marine business line of former FPT Powertrain Technologies sector Long and glorious heritage with unique positioning in sports and luxury segment 2. Includes activities of Passenger & Commercial Vehicles business line of former FPT Powertrain Technologies sector A series of agreements governing supply of shared services to 2 groups, enabling existing synergies and economies of scale to be maintained and improved Joint liability for Fiat and Fiat Industrial, limited to value of equity retained or transferred, on any existing debts of Fiat not satisfied by company to which they are assigned June 13, 2011 European Fixed Income Investors 4

5 financial targets from Apr 2010 Business Plan bn E 2012E 2013E 2014E 35.9 Revenues ~ Trading Profit Industrial EBITDA CAPEX Better than guidance FY 11 targets confirmed including Net Income of ~ 0.3bn Net industrial debt between 1.5 and 1.8bn June 13, 2011 European Fixed Income Investors 5

6 Q1 11 highlights Margin held firm, more solid underlying fundamentals Revenues ( bn) Net profit ( mn) FGA up 2.6% Double-digit increase for both Luxury & Performance brands and Components +7.1% Improvement of 24mn with no unusuals Income taxes of 116mn primarily related to taxable income of companies operating outside Italy and employment-related taxes in Italy Q1 10 Q1 11 Q1 10 Q1 11 Trading profit ( mn) Strong performance for Luxury & Performance brands and Magneti Marelli, with a slight contraction for FGA % Net industrial debt ( mn) Continued discipline in working capital management Capital expenditure typically low in Q1 Q1 10 Q1 11 Dec-end 10 Mar-end Trading margin 2.7% 2.7% 12.2 Liquidity ( bn) FGA: 1.9% Ferrari: 10.8% Maserati: 6.7% Components & Production Systems: 2.0% Q1 10 Q1 11 Dec-end 10 Mar-end 11 Note: Q1 10 figures are provided herein on a pro-forma basis to reflect a carve-out of Fiat operations from the historical Fiat Group financial statements Strong position Increase primarily attributable to reimbursement of net financial debt by Fiat Industrial, net of repayments to banks in January Proceeds from bond issue of 1bn (5-year maturity, 6.375% coupon) with settlement on Apr 1 st not included in quarter-end June 13, 2011 European Fixed Income Investors 6

7 Net debt breakdown ( bn) Dec. 31, 10 Mar. 31, 11 (1) Cons. Ind. Fin. Cons. Ind. Fin Gross Debt (2) (0.3) (0.3) - Derivatives M-to-M, Net (0.4) (0.4) - (12.2) (11.9) (0.3) Cash & Mktable Securities (13.1) (12.9) (0.2) Net Debt (1) Debt and cash proceeds from 1bn bond with maturity 2016 settled on April 1st, not included (2) Net of intersegment receivables and including: (2.8) (2.8) - Intercompany Receivables from Fiat Industrial, net Note: Numbers may not add due to rounding June 13, 2011 European Fixed Income Investors 7

8 Debt maturity schedule (1) ( bn) Outstanding Mar. 31, 11 Next 12 M 9M Beyond 5.2 Bank Debt Capital Market (2) Other Debt Total Cash Maturities Cash & Mktable Securities 0.0 of which Restricted Cash 3.3 Sale of Receivables (IFRS de-recognition compliant) 2.3 of which receivables sold to financial services JVs (FGA Capital) (1) Debt & cash proceeds from 1bn bond with maturity 2016 settled on April 1 st, not included (2) Excluding fair value of bonds, including interest accruals Note: Numbers may not add due to rounding June 13, 2011 European Fixed Income Investors 8

9 FIAT GROUP AUTOMOBILES

10 Backward looking Track record of success Industrial trading profit margin* 10% 8% NIS TOY 6% 4% 2% VW DAI PSA RNO BMW % % 2% 0% FGA, Ferrari & Maserati VW 2.4% -2% -4% -6% (4.4)% FGA, Ferrari & Maserati -2% -4% TOY PSA RNO DAI NIS BMW -6% Operating losses in 2004 were running at 2mn a day and, taking into account borrowing costs and taxes, that figure reached 4mn a day, weekends included * excluding non-recurring Source: companies annual reports June 13, 2011 European Fixed Income Investors 10

11 Significantly strengthened position in Europe Industry volume & market share (Passenger cars) Industry (mn units) FGA market share EU27+ EFTA 7.3% 6.4% 7.5% 8.0% 8.2% 8.6% 28.0% 28.0% 30.8% 31.4% 31.9% 32.8% Sequential year-over-year market share gains All brands repositioned in most EU countries June 13, 2011 European Fixed Income Investors 11

12 The Cinderella stories LCVs Brazil (Passenger cars & LCVs) 10.7% 10.3% 10.9% 11.7% 12.3% 12.8% EU27+ EFTA % 25.0% 25.4% 25.9% 24.6% 24.5% % 40.6% 45.3% 42.1% 43.3% 39.9% Industry (mn units) Fiat market share Industry (mn units) Fiat Professional market share Fiat perceived as a domestic player Strong dealer network Highly versatile and flexible manufacturing footprint Significant barriers to replicate Fiat s market position June 13, 2011 European Fixed Income Investors 12

13 A game-changing strategic transformation Critical mass target: 6mn units by 2014 Optimal capital allocation and improved capacity utilization through product portfolio integration Greater geographic penetration: North America for Fiat and Europe / Latin America for Chrysler Significant cost synergies, particularly in purchasing and engineering Sharing of best practices in the area of World Class Manufacturing, engineering and design, quality and management June 13, 2011 European Fixed Income Investors 13

14 The creation of a global automaker Milestones in the integration of Fiat & Chrysler Group 2009 JUNE 2011 JANUARY 2011 APRIL 2011 MAY 2011 JUNE 2011 YEAR-END (EXPECTED) - SUBJECT TO REGULATORY APPROVAL - 1 ST PERFORMANCE EVENT 2 ND PERFORMANCE EVENT 3 RD PERFORMANCE EVENT Fiat initially received 20% ownership interest in Chrysler Group LLC, subject to increase to 35% in 5% increments upon occurrence of 3 performance events 1 st performance event achieved in conjunction with US production of Fiat s fuel efficient Fully Integrated Robotized Engine (FIRE) in Dundee, Michigan, increasing Fiat s ownership interest to 25% 2 nd performance achieved as Chrysler Group reached $1.5+B cumulative revenues outside North America and the following At least 90% of Fiat dealers in Brazil agree to distribute Chrysler Group products At least 90% of Fiat dealers in EU agree to distribute Chrysler Group vehicles Chrysler Group and Fiat agree to pool Chrysler Group and Fiat vehicles in EU for CO 2 emissions ratings Compensation to Chrysler Group for use of its technology by Fiat and its affiliates outside of North America Concurrently with closing of refinancing of Chrysler s debt and full repayment by Chrysler of its debt to US and Canadian governments on May 24, Fiat completes exercise of its option to purchase an incremental 16% interest (fully-diluted) in Chrysler, under arrangements announced on April 21, 2011, in exchange for cash payment of $1,268mn Fiat agreed to pay Fiat $500mn to purchase 6% UST s ownership interest in Chrysler. In addition, UST agreed to assign to Fiat its rights under Equity Recapture Agreement for $75mn. Under Equity Recapture Agreement, holder receives all proceeds from Chrysler ownership interests held by VEBA over specified threshold ($4.25bn plus 9% p.a. compounded annually from Jan 1, 2010).. Once threshold is reached, any remaining shares are turned over to holder 3 rd performance event, allowing Fiat to increase its ownership interest to 57%, relates to Chrysler Group producing an unadjusted combined 40 MPG vehicle off a Fiat platform in US PRO-FORMA SHAREHOLDER STRUCTURE 41.5% VEBA 57.0% Fiat 1.5% Canada Fiat could increase its interest in Chrysler to 70% or more through: Option to purchase 40% of VEBA s original interest in Chrysler ( Covered Interest ). Option is exercisable July 1, 2012 until June 30, 2016 but not in excess of 20% of Covered Interest in any 6 month period. Before an IPO, exercise price is based on a market multiple not to exceed Fiat s multiple applied to Chrysler reported LTM EBITDA less net industrial debt and following an IPO based on trading price of common stock Under Equity Recapture Agreement, holder may purchase any remaining membership interests held by VEBA at the specified threshold less any sales proceeds previously received by VEBA June 13, 2011 European Fixed Income Investors 14

15 Paid Refinancing transaction overview May 24, 2011 transaction along with exercise of Incremental Equity Call Option (described below) fully refinanced and replaced obligations under existing US Treasury and Export Development Canada credit facilities (and terminated lending commitments thereunder), through issuance of $1.3B 1 st Lien Revolving Credit Facility (undrawn) $3.0B 1 st Lien Senior Secured Term Loan B $3.2B New Secured Senior Notes Refinancing enhance both operational and financial flexibility Significantly reduce interest expense by $300+M per year Strong liquidity of ~$11B at closing Eliminates $2.6B of principal payments in 2011 and pushes initial significant maturities out to 2017 Repayment of Government debt opened potential for incremental sources of capital Facilitated Fiat s exercise of its primary call option ( Incremental Equity Call Option ) for ~$1.3B, whose exercise was contingent upon full repayment of obligations associated with US Treasury and Export Development Canada credit facilities Transaction enhances potential for attractive US Department of Energy ( DOE ) financing Sources of Funds New Term Loan B $ 3.0 New Secured Senior Notes 3.2 Incremental Equity Call Option 1.3 Cash from Balance Sheet 0.3 Total Sources $ 7.8 ($ Billions) Uses of Funds Repay Government Debt $ 7.6 Fees and Expenses 0.2 Total Uses $ 7.8 European Fixed Income Investors 15

16 Chrysler Group LLC One group, unique brands TRUCKS SUVS FULL-LINE PASSENGER CARS, CUVS & MINIVANS ELEGANT SEDANS & PREMIUM MINIVANS HIGH PERFORMANCE FOR CHRYSLER / JEEP / DODGE SMALL CARS AUTHENTIC PARTS, ACCESSORIES & SERVICE SEPARATED THE RAM TRUCK LINEUP FROM THE DODGE BRAND IN 2009 LAUNCHED THE NEW RAM 2500 AND 3500 HEAVY DUTY PICK-UP TRUCKS IN LATE 2009 OVER 7 MILLION VEHICLES ON ROAD WORLDWIDE OUR MOST GLOBAL BRAND WITH SALES IN 120+ COUNTRIES ENTIRE MODEL LINE-UP EITHER RENEWED OR SIGNIFICANTLY REFRESHED DURING 2010 FOUNDED IN 1914, A QUINTESSEN- TIALLY AMERICAN BRAND; EMBODIES CAPABILITY, STYLE, AND AN AGELESS ENTHUSIASM FOR FUN AND PERFORMANCE PRODUCTS KNOWN FOR VALUE, POWER, SAFETY AND STYLE BUILT ON 85 YEARS OF TRADITION CHRYSLER IS THE INVENTOR AND LEADING INNOVATOR OF THE MINIVAN FOCUS ON ELEGANT MID- AND FULL-SIZE CARS STREET & RACING TECHNOLOGY HAS FIVE HALLMARKS: AWE-INSPIRING POWERTRAIN; OUTSTANDING RIDE AND HANDLING; SUPERIOR BRAKING; AGGRESSIVE EXTERIOR; RACE INSPIRED INTERIOR ITALIAN BY DESIGN - STYLISH, MODERN, PURPOSEFUL CHRYSLER GROUP S OVERALL CORPORATE FUEL ECONOMY AVERAGE BENEFITS FROM FIAT SHARED TECHNOLOGY EMBODIED IN FIAT 500 NORTH AMERICAN BRAND FOR AUTHENTIC ORIGINAL PARTS & ACCESSORIES SALES OF MOPAR PARTS PROVIDE LESS CYCLICAL REVENUE STREAM AND CASH FLOW GENERATION; SALES TIED TO FUNCTION OF MILES DRIVEN AND CAR PARC European Fixed Income Investors 16

17 Strong product onslaught in 2010 Extensive (1) Upgrade (2) Start of production Chassis Interior Exterior Powertrain Ram Chassis Cab Q1 Jeep Grand Cherokee Dodge Durango Dodge Charger Chrysler 300 Fiat 500 Q2 Q4 Q4 Q4 Q4 6 New Vehicles Jeep Liberty Jeep Wrangler Jeep Patriot Jeep Compass Dodge Challenger Dodge Journey Dodge Avenger Dodge Grand Caravan Chrysler Town & Country Chrysler 200 Q1 Q3 Q3 Q4 Q3 Q4 Q4 Q4 Q4 Q4 10 Significantly Refreshed Vehicles 1. Extensive refers to easily recognizable changes to appearance and/or several functional attributes to the vehicle 2. Upgrade refers to a minor change or a change to one or more functional attributes that are measurable but not easily recognizable European Fixed Income Investors 17

18 Commitment to Enhanced Product Portfolio th Anniversary Commemorative product actions across all nameplates Overall 24 new models and 19 major product interventions ORIGIN OF ARCHITECTURE PRODUCT ACTIONS IMPORTED VEHICLE Chrysler Group Fiat Major modification Fiat produced European Fixed Income Investors 18

19 Complementary integrated architecture and product strategy Segment architecture LCVs Mini Small Compact Large MPV SUV 1 mn units Clear delineation of responsibilities between Fiat and Chrysler Group Architecture management Product development applications Designated lead plants Fiat and Chrysler each to focus on their core strengths Maximize architecture convergence and components standardization By 2014, Fiat to move from 11 to 5 architectures, Chrysler from 11 to 7 (excl. trucks and specialties) The 3 main architectures expected to exceed 1mn units each by 2014 Pick-up E 2014E E 2014E E 2014E Architecture origin Mini Small Compact Fiat Group Automobiles Chrysler Group Fiat Group Automobiles Chrysler Group June 13, 2011 European Fixed Income Investors 19

20 Architecture convergence & component standardization to yield significant benefits Purchasing efficiency range (case study) Model/Brand Specific Other Common Components Modular Architecture & Powertrain 100% = Total Vehicle Cost 25-30% 10-15% 55-65% 1%-2% 2%-4% 5+% Reduced investment & development costs Shortened time-to-market Increased economies of scale Improved quality & reliability Optimized production capacity utilization & manufacturing flexibility 100k 300k 500k 1,000k Units Optimal allocation of production (case study) ER&D and Capex savings (case study) Cars developed on common architectures can be allocated to same flexible manufacturing plant to optimize industrial costs, including supply chain costs C SUV Fiat Plant A Plant B C SUV Chrysler Group Top hat & powertrain applications Industrial installation Platform development Up to 60-65% reduction Further opportunities for savings in powertrain application costs and ER&D spending by sharing volumes D Sedan Fiat C Sedan Chrysler Group Primary vehicle on a brand-new architecture First derivative vehicle June 13, 2011 European Fixed Income Investors 20

21 Alfa Romeo The revival of a brand Strategy Re-launch of Alfa Romeo brand, including strong European push Return to North American market through Chrysler network NEW MODEL PRODUCED BY PRODUCT ACTIONS Note: European product plan Chrysler Group Fiat Major modification Giulia New generation of Alfa Romeo sedan and sportwagon Competitive products combining comfort, versatility and driving pleasure Available for distribution in NAFTA market 4C Concept Unveiled at Geneva Motorshow Successful performance in Q1 in line with annual volume target of k ~30k orders taken and ~25k shipments A perfect balance of technology, comfort & performance in a compact hatchback Common architecture for C- & D- segment of FGA & Chrysler Group C-SUV A supercar taking up brand s sporting tradition, set to reinforce global growth 1 st Alfa Romeo car to re-entry US market A 2-seater also embedding technology & materials derived from 8C Competizione Alfa Romeo enters SUV segment which account for 1.2mn vehicles in EU27 Perfect combination of SUV segment versatility and Alfa Romeo dynamism Commercialized also in NAFTA market June 13, 2011 European Fixed Income Investors 21

22 Jeep I live. I ride. I am. Strategy Positioning as a global brand Note: European product plan Founded 70 years ago A global & iconic brand, unique in the industry; categorized an entire segment Distinguished design and rugged authenticity Over 7mn Jeep vehicles on the road today worldwide, sold in 120+ countries Entire Jeep model range either renewed or significantly refreshed during Jeep Grand Cherokee 30 industry awards and climbing Targeting 125k units in Europe in 2014 Since May 2010, Jeep distribution in Europe gradually transferred to FGA and carried out through its National Sales Companies Austria, Belgium, Czech Republic, Denmark, France, Germany, Hungary, Italy, Netherlands, Poland, Serbia, Spain, Sweden, Switzerland & UK now fully integrated A new Jeep distribution network in Europe (fully operational from June 2011) to consist of 430 dealerships Also technical integration continuing apace with sharing of know-how, manufacturing & environmental best practices Introduction of MultiJet II technology on all-new 3.0-liter turbo-diesel for Grand Cherokee NEW MODEL PRODUCED BY Chrysler Group Fiat PRODUCT ACTIONS Major modification June 13, 2011 European Fixed Income Investors 22

23 Fiat Sound product portfolio rejuvenation Strategy Major focus on core A,B,C segments Continue building on sporty image NEW MODEL PRODUCED BY Chrysler Group Fiat PRODUCT ACTIONS Major modification New Panda Note: European product plan New Punto Next generation of best seller city car in Europe with ~2mn vehicles sold from commercial launch (2003) and ~20% on average market share Renewal of Fiat best seller model with ~1.5mn vehicles sold from commercial launch (2005) New Fiat Ellezero Emotionally and roomy compact MPV 5- & 7- seats available First FGA vehicle to come out of partnership with Chrysler, on sale in Europe starting Q2 11 Built in Mexico, based on significantly refreshed Dodge Journey Enlarging product offering with a specific TwinAir version equipped with the greenest engine in market, available in market in Q2 11 Revolutionary 2-cyl gas MultiAir engine, more powerful (up to 10%) and fuelefficient (up to 10%) vs. conventional gas engine of equivalent size June 13, 2011 European Fixed Income Investors 23

24 Lancia Full-liner player with 5 new products in a blink Strategy Full integration with Chrysler Comprehensive product line leveraging on Chrysler nameplates NEW MODEL PRODUCED BY Chrysler Group Fiat PRODUCT ACTIONS Major modification Note: European product plan A compact flagship with benefits of a large saloon Based on significantly refreshed Chrysler 200 A city-limousine, the best selling minivan in Italy for past 4 years Fashion city-car, sharing architecture with Fiat 500 Targeting upper-end of B-segment 5-door concept addressing ~2/3 of segment vs. previous 3-door predecessor On sale from June across key European markets (launch in UK in September under Chrysler badge) First global flagship, a RWD equipped with segment leading standards (derived from all-new Chrysler 300) A true icon in MPV category with 13mn units sold Based on significantly refreshed Chrysler Town & Country The most advanced safety systems in market today and the most advanced entertainment system in its class June 13, 2011 European Fixed Income Investors 24

25 Fiat Professional A leading position in Light Commercial Vehicles Strategy Maintaining strong position in EU & Latin America Leveraging on Chrysler opportunities Consolidating strong industrial and R&D partnerships Strengthening body-builder business NEW MODEL PRODUCED BY Chrysler Group Fiat PRODUCT ACTIONS Major modification Note: European product plan The most updated and complete product offerings of any EU producer Fiat Professional best in class in CO 2 emissions and the widest CNG range in LCV market Strong distribution network June 13, 2011 European Fixed Income Investors 25

26 Expanding international reach Albeit negotiations ended with Sollers, Fiat confirms commitment to Russia and intend to continue to expand existing operations and activities Focus on B, C, D and SUV segments, leveraging on Jeep brand 50/50 FGA-GAC All models share single architecture Targeting ~300k units by 2014 and 2% market share Focus on C, D and SUV segments, leveraging on Jeep brand 50/50 Fiat India JV Automobiles Private Limited Sales target of ~130k units by 2014 or 5% market share Focus on B and C segments Strengthening dealer network June 13, 2011 European Fixed Income Investors 26

27 Volumes growth driven by market recovery and new products momentum 2.2 Market driven growth Market share growth RoW / New markets Reported sales by brand (Passenger Cars & LCVs) Units millions Total growth Contract manufacturing Market 2009 driven share New markets driven share driven share New markets driven share (EU) manufac. 2014E growth (EU+LatAm) Market growth (EU+LatAm) RoW / Market growth (EU+LatAm) Market growth (EU+LatAm) Market growth (EU) Market growth (EU) RoW / Market growth (EU) Market growth (EU) Jeep Contract Source: IHS Global Insight and FGA estimates Notes: (1) Include c.20k units in NAFTA and c.110k units in RoW. (2) Include c.85k units in NAFTA and c.10k units in RoW June 13, 2011 European Fixed Income Investors 27

28 2010 and beyond FY 10 CAGR % +3.8% 13.8 ~ E 2014E Passenger cars Industry (mn units) FGA market share EU27+ EFTA 12.8% 1.7 ~1.8 CAGR % E 2014E E 2014E E 2014E LCVs Passenger cars LCVs Brazil (Passenger Cars + LCVs) 22.8% ~ CAGR % 2011E 30.1% 2.0 ~ E CAGR % % 0.19 ~0.2 CAGR % 0.23 Passenger car industry (EU27+EFTA) down 4.9% to 13.8mn units with mixed but overall positive trend in minor markets unable to counter drop in demand A mixed year, with overall market up in Q1 on the back of ecoincentive tail in most countries while down ~10% for the rest of the year LCVs market (EU27+EFTA) recovering from 2009 lows, topping 1,660k units, but well below levels Double-digit demand growth in Germany, France & UK; more modest increase in Italy & Spain (+6.2% and 9.5% respectively) Brazil: all-time overall industry high at 3.3mn units in 10 (+10.6% vs. prior year); record sales in December (361k units) Fiat leader for 9 th consecutive year with 22.8% overall share Booming passenger car market (+6.9% to 2.7mn units) Successful launch of Novo Uno (110k units sold), winner of 15 prizes in 2010 including Carro do Ano award Strong LCV market, up 29.5% to 0.6mn units Fiat undisputed market leader with ~8 p.p. advantage FY 11 expectations EU27+EFTA Passenger cars: slightly better outlook than previous forecast with market now seen at ~13.6mn units mostly on the back of doubledigit growth in Germany partly offset by declines in Italy, Spain & France; upcoming new products expected to improve FGA share in H2 vs. H1 LCVs: continued recovery in overall industry with positive performance in major markets (ex Spain); Fiat Professional expected to maintain a leading position Brazil: overall industry expected at ~3.5mn units; Fiat share projected in line with 2010 level June 13, 2011 European Fixed Income Investors 28

29 World class industrial base Italy % Capacity utilization (Passenger car plants) 2014E 136% Key commitments (Italian plants) Labour Union agreements: securing the future through greatest operating flexibility at plants Pomigliano d Arco: new collective labour agreement in force since Jan 2011 replacing national Metal Industry labour contract Rest of Europe 2 37% 78% 126% 93% 86% 138% Start of production of future Panda in H (expected volumes up to 270k units/year) Mirafiori: agreement for plant re-launch through establishment of Fiat & Chrysler JV Production of C-segment SUVs for distribution under both Jeep & Alfa Romeo brands worldwide (including US) with output levels of up to a maximum of 280k vehicles per year Harbour definition (235 days per annum/16 hours per day) Technical definition (280 days per annum/3 shifts per day) Ensuring more effective plant operations, with no infringement on worker rights World Class Manufacturing One standard Shared best practices throughout enlarged Fiat Group Extension of World Class Manufacturing program to supplier plants ~190k new projects being implemented (230k cumulative projects since 2006) 1.9bn expected savings from WCM from 2010 to 2014 ( 2.6bn cumulative savings since 2006) All conditions of national collective agreement remaining unchanged, as well as, those granted over time by Fiat in favour of workers Bertone: agreement has been signed and necessary conditions are in place. Fiat will therefore proceed with investment program detailed in plan ~ 500mn investment for production of a new E-segment Maserati for international distribution Once fully operational, plant production will up to 50k cars per year with a progressive return to full utilization of workforce Termination of car production at Termini Imerese plant in Italy: Cassino, Melfi, Mirafiori, Pomigliano d Arco & Termini Imerese (ceasing production by 2001 year-end) 2 Tycky (Pol), Kragujevac (Ser), Bursa (Tur, ncluding vehicles supplied to Opel in force of Nov 2010 agreement) June 13, 2011 European Fixed Income Investors 29

30 FGA business plan financial targets 60 20% % 40 Overachievement in 2010 Nearly 28bn in revenue vs. initial target of 26.6bn Trading profit at 607mn vs. mid-point target of ~ 370mn (1.2%-1.6% margin range) % Net revenues ( bn) (1.4)% % % 2.6% 1.8% % % 1.7% 3.2% 2.4% 3.9% 3.1% 5.1% 4.3% 5% 0% Trading margin (4.2)% E 2012E 2013E 2014E Net revenues Trading margin - Actual Trading margin - High Trading margin - Low -5% Source: Company Annual Reports and Fiat Group Business Plan June 13, 2011 European Fixed Income Investors 30

31 FIAT POWERTRAIN

32 Excellence in powertrain Gasoline engines: Leveraging on MultiAir New breed of technologies to achieve CO 2 reduction in combustion engines 2 nd generation MultiAir technology In-house development of advanced turbo charging Systems MultiAir coupled with GDI technology Extension of MultiAir technology to diesel engines combined with new IP in EGR control functionality New high-efficiency downsized engines First application of the 0.9L TwinAir Turbo in Fiat 500 (Q3 2010), under development Naturally Aspirated,CNG variants, and 105 hp versions Euro 6 compliance under development Diesel engines: MultiJet II technology Digital Injection Rate Shaping (IRS) brings up to 3% lower CO 2 emissions Lower NOx emissions up to 20% Noise and driveability improvement Portfolio for both FGA & Chrysler Group offering rounded out with 2 state-of-theart products through acquisition of Penske Corp s 50% stake in VM Motori, jointly managed with GM 3.0 V6 to complete top-power requirements Cost competitive and highly reliable 2.8L 4- cyl. to equip SUVs & MPVs Euro 6 compliance under development Transmissions: New small DDCT To extend dual-clutch transmission technology to A & B segments To be the basis for a compact, low-weight and low-cost hybrid powertrain Add-on option of baseline powertrain minimizing specific investments and R&D costs base Base Version 1.4L Fire MultiAir Turbo 1.8L GDI Turbo Main benefits: Up to 25% CO 2 emissions and fuel consumption reduction over a higher displacement naturally aspirated engine 0.9L TwinAir Turbo Main benefits: CO 2 level well below 100 g/km for both gas & CNG versions of 0.9L 2-cylinder spark ignition engine on A-segment vehicles 1.3L MultiJet II RA428 4-cyl 2.8L 200hp RA630 V6 3.0L hp Add-on electric motor Hybrid Small June 13, 2011 European Fixed Income Investors 32

33 Fiat & Chrysler technology and know-how sharing A win-win combination Turbocharged engines with MultiAir & direct injection technologies Cost Effective & Fuel Efficient L4 and V6 gasoline engines TwinAir and FIRE L 16v Fam. B 1.8L 16v GDI Turbo MultiAir technology application to WGE & V6 Pentastar engines Pentastar V6 Engine 3.0L - 3.6L V6 24v World Gas Engine L 16v Diesel MultiJet II engine with High Pressure Common Rail technology 4-cyl: SDE (1.3L ), Fam. B ( L ), 2.8L V6: 3.0L Enlarging portfolio offering with diesel technology Dual Dry Clutch Transmission 6/7-speed Broadening and sharing transmission & AWD technologies Off-road capability, Driveline disconnect 8- & 9-speed planetary automatic transmissions Alternative Fuels CNG, LPG CNG Fiat s technological leadership in Europe, a key asset for US natural gas vehicle market Synergies in hybrid and electric propulsion for specific markets/applications Electrification/ hybridization June 13, 2011 European Fixed Income Investors 33

34 LUXURY & PERFORMANCE BRANDS

35 Widening margins and accelerating growth Increase product differentiation to target new customers in the highend sport cars segment Keep innovating with a new model every year to sustain turnover and reinforce brand Selectively exploit Special Series to target high-end customers and collectors Continuing search for opportunities in emerging markets, maintaining exclusivity in mature ones Personalization, one-off program, spare parts and after sales services improvement Production efficiencies and fixed cost optimization Further growth of Licensing, Retail & e-commerce and Ferrari Financial Services New generation of Quattroporte Extend luxury market coverage by entering high-end E and I segments Maintain and sustain GranTurismo and GranCabrio products in H segment Increase global market shares in all segments G segment: from 3% to 8% E segment: > 10%, in high-end I segment: > 4% H segment: > 10%, maintaining current top 3 ranking position Dealer network improvement to support volume growth Production efficiencies and fixed cost optimization Ferrari FF GranCabrio Sport June 13, 2011 European Fixed Income Investors 35

36 Ferrari & Maserati financial targets % Net revenues ( bn) % % % Overachievement in 2010 Top line at 2.4bn vs. initial target of 2.1bn Trading profit exceeding 300mn vs. mid-point target of ~ 210mn (9.8%-10.2% margin range) % % % 10.9% % 15.3% 14.2% 13.4% 15.0% 14.2% 35.0% 30.0% 25.0% 20.0% 15.0% 10.0% Trading margin % 5.0% % 0.0% E 2012E 2013E 2014E Net revenues Trading margin - Actual Trading margin - High Trading margin - Low -5.0% Source: Company Annual Reports and Fiat Group Business Plan June 13, 2011 European Fixed Income Investors 36

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38 High value added components business Highlights Revenues breakdown by product Leadership in Lighting, Electronics and Powertrain Diverse automotive customer base Exhaust Systems Suspension Systems Plastic Components and Modules Shock Absorbers After Market 43% 2010 Revenues: 5.4bn 29% 11% Lighting Strong backlog 17% Electronics Track record of growth and profitability Powertrain Revenues in 2010 driven by strong performance in both China and Brazil and significant recovery in NAFTA region, on new product launches; European performance impacted by elimination of government eco-incentives Revenues breakdown by customer 5.4bn 19% 8% 7% 8% 7.7bn 19% 13% 10% 18% Others US OEMs French OEMs German OEMs All business lines recorded an increase in production volumes in % 40% Fiat E June 13, 2011 European Fixed Income Investors 38