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Skip to comments.Fiat boss warns European car industry could 'unravel' unless EU co-ordinates capacity cuts
Posted on 01/15/2013 11:42:21 PM PST by bruinbirdman
The boss of Italian carmaker Fiat has warned that Europe's embattled car industry will 'unravel' unless the European Union steps into co-ordinate urgent cuts in capacity across the continent.
Sergio Marchionne, who is also chief executive of US carmaker Chrysler, said that the biggest carmakers in Europe probably lost about 5bn in 2012 as sales in the region fell for a fifth straight year.
With sales forecast to decline for a sixth year in 2013, most experts believe that the industry needs to embark on significant retrenchment to better match the weakened state of demand from drivers. "I've been an advocate of European intervention in the sector which allows an equitable distribution of the reductions over the countries," Mr Marchionne said at the Detroit Car Show on Tuesday.
The absence of any co-ordination by the European Commission, Mr Marchionne argued, will lead to cuts being made in a "haphazard" way that will see governments put their national interests above the greater good of Europe's car industry.
Europe has again been the biggest headache at the annual gathering in Detroit, where executives have been optimistic about the prospects for both the US and Asian markets in 2013.
Fiat, which acquired a 60pc stake in Chrysler after the US carmaker plunged into bankruptcy in 2009, expects to have lost 700m in Europe last year.
"Ultimately, this whole thing will unravel," said. Mr Marchionne, one of the industry's most high-profile executives. Fiat, Peugeot-Citreon and Renault have all estimated that the European car industry has about 20pc too much capacity, but factory and plant closures have so far been limited as carmakers faces intense pressure from European governments not to act.
Mr Marchionne said that Europe needs to take lessons from the collapse of the US car industry in late 2008,
(Excerpt) Read more at telegraph.co.uk ...
Reason 1: Massively over priced.
Reason 2: Expensive to service.
Reason 3: Not particularly reliable.
Reason 4: Diabolical after sales Care from Dealerships.
Reason 5: Shoddy construction.
These may be the reasons i now own a Korean vehicle.