Moodys.com
Close
Please Note
We brought you to this page based on your search query. If this isn't what you are looking for, you can continue to Search Results for ""
The maximum number of items you can export is 3,000. Please reduce your list by using the filtering tool to the left.
Close
Close
Email Research
Recipient email addresses will not be used in mailing lists or redistributed.
Recipient's
Email

Use semicolon to separate each address, limit to 20 addresses.
Enter the
characters you see
Close
Email Research
Thank you for your interest in sharing Moody's Research. You have reached the daily limit of Research email sharings.
Close
Thank you!
You have successfully sent the research.
Please note: some research requires a paid subscription in order to access.
Already a customer?
LOG IN
Don't want to see this again?
REGISTER
OR
Accept our Terms of Use to continue to Moodys.com:

PLEASE READ AND SCROLL DOWN!

By clicking “I AGREE” [at the end of this document], you indicate that you understand and intend these terms and conditions to be the legal equivalent of a signed, written contract and equally binding, and that you accept such terms and conditions as a condition of viewing any and all Moody’s inform​ation that becomes accessible to you [after clicking “I AGREE”] (the “Information”).   References herein to “Moody’s” include Moody’s Corporation, Inc. and each of its subsidiaries and affiliates.

Terms of One-Time Website Use

1.            Unless you have entered into an express written contract with Moody’s to the contrary, you agree that you have no right to use the Information in a commercial or public setting and no right to copy it, save it, print it, sell it, or publish or distribute any portion of it in any form.               

2.            You acknowledge and agree that Moody’s credit ratings: (i) are current opinions of the future relative creditworthiness of securities and address no other risk; and (ii) are not statements of current or historical fact or recommendations to purchase, hold or sell particular securities.  Moody’s credit ratings and publications are not intended for retail investors, and it would be reckless and inappropriate for retail investors to use Moody’s credit ratings and publications when making an investment decision.  No warranty, express or implied, as the accuracy, timeliness, completeness, merchantability or fitness for any particular purpose of any Moody’s credit rating is given or made by Moody’s in any form whatsoever.          

3.            To the extent permitted by law, Moody’s and its directors, officers, employees, representatives, licensors and suppliers disclaim liability for: (i) any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with use of the Information; and (ii) any direct or compensatory damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud or any other type of liability that by law cannot be excluded) on the part of Moody’s or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with use of the Information.

4.            You agree to read [and be bound by] the more detailed disclosures regarding Moody’s ratings and the limitations of Moody’s liability included in the Information.     

5.            You agree that any disputes relating to this agreement or your use of the Information, whether sounding in contract, tort, statute or otherwise, shall be governed by the laws of the State of New York and shall be subject to the exclusive jurisdiction of the courts of the State of New York located in the City and County of New York, Borough of Manhattan.​​​

I AGREE
Rating Action:

Moody's changes outlook on Fiat Chrysler's ratings to positive; affirms ratings

04 Nov 2019

Frankfurt am Main, November 04, 2019 -- Moody's Investors Service ("Moody's") has today changed the outlook on the ratings of Fiat Chrysler Automobiles N.V. (FCA) and Fiat Chrysler Finance Europe SA to positive from stable. Concurrently, Moody's affirmed the Ba1 corporate family rating (CFR) and the Ba1-PD probability of default rating (PDR) of FCA and the Ba2 ratings on the senior unsecured instruments issued by FCA and Fiat Chrysler Finance Europe SA.

"The positive outlook reflects the potential for a stronger credit profile of the combined Fiat and PSA entity should the proposed merger between FCA and PSA be successfully executed.", said Falk Frey, a Senior Vice President and Moody's lead analyst for FCA. "The merger would create a larger and more diversified global auto manufacturer with substantial synergy and efficiency potential, which will help to mitigate multiple challenges within the global automotive manufacturing industry.", added Mr. Frey.

A full list of affected entities and ratings can be found at the end of this press release.

RATINGS RATIONALE

RATIONALE FOR THE POSITIVE OUTLOOK

Moody's considers the rationale of the proposed merger as strong, given (i) the significant scale effects compared to FCA's standalone sales of EUR110 billion in 2018 (excluding Magneti Marelli), including improved market shares globally and in the individual regions, (ii) the additional regional and brand diversification, and (iii) expected material synergies in the area of production cost, research and development (R&D) and capital expenditures. The merger also addresses FCA's perceived weakness in its electrification strategy, with the transaction allowing it to participate in more comprehensive and advanced solutions offered by PSA. Taking the Baa3 rating of PSA and the abovementioned benefits of the merger into consideration, its successful execution could result in a rating upgrade for FCA, assuming no further deterioration of the global automotive industry environment in 2020.

However, we believe that there are significant uncertainties in relation to reaching a definitive merger agreement and that executing the merger will be a lengthy and complex process in an increasingly challenging global auto market. Hence, for any further positive rating action, we would need to better understand the timing and financial implications of the transaction as well as get comfortable that the combined entity can sustain credit metrics commensurate with an investment grade rating in during a period of potentially weaker market conditions.

Our standalone expectation for FCA includes continued improvement of its financial metrics in the current fiscal year according to the company's guidance thus achieving a Moody's adjusted EBITA margin level of around 6% and containing its Moody's adjusted gross leverage (debt/EBITDA) below 2.0x.

On 31 October 2019, FCA announced that its Board of Directors has unanimously agreed with the supervisory board of Peugeot S.A. (PSA, Baa3 stable) to work towards a full combination of the company's respective businesses by way of a 50/50 merger. Both boards have mandated their respective teams to develop a binding memorandum of understanding in the coming weeks. A realization of the merger plan would create the world's fourth largest automotive original equipment manufacturer (OEM) with approximately 8.7 million vehicles sold in 2018, and combined revenues of nearly EUR170 billion. The merger plan, which is subject to execution risks, includes planned synergies of EUR3.7 billion annually, against one-time restructuring cost of EUR2.8 billion, and the payment of special dividends of EUR5.5 billion in cash and the shareholding in Comau to FCA's shareholders. PSA plans to distribute its 46% stake in the automotive parts supplier Faurecia (Ba1 stable) to its shareholders.

Environmental, social and governance risks have been considered in FCA's ratings and outlook. The company is exposed to the transition risks of the industry towards alternative fuel vehicles, and autonomous driving technologies, which will weigh negatively on the company's future cash flow generation. We note that FCA has been cautious so far to invest aggressively into these areas compared to most of its European peers. In addition, in order to improve its competitive position, global visibility and enhance its model range, FCA will continue to make significant investments in the next few years for the renewal of its models across the brand portfolio. The company is exposed to the sector specific social risks, including strike risks of typically well organized workers unions and demographic changes within its end markets, where customers could seek to buy more environmental friendly vehicles and pay less attention to the brand value of vehicles. FCA's governance risks are relatively low, given the company's status as listed company with high standards in terms of organzational structure and public disclosure. Moody's also considers FCA's financial policy as conservative.

RATIONALE FOR RATING AFFIRMATION

The rating affirmation reflects FCA's standalone credit profile. The Ba1 CFR is supported by (1) the company's significantly improved credit metrics in recent years, driven by substantial deleveraging actions and sustainably improved albeit still moderate operating profitability (note: all 2018 and 2017 figures presented in the following exclude Magneti Marelli); (2) its degree of geographic diversity, including a large exposure to North America, and its market leading presence in its domestic market Italy and in Brazil; (3) the now local production of certain key Jeep models in China, India, Italy, Mexico and Brazil, expanding Jeep's geographic coverage and improving FCA's cost structure and (4) the recent successful new model launches in the SUV and pickup truck segment leading to a more favorable product mix.

FCA's Ba1 rating remains constrained by (1) the highly competitive nature of the automotive industry, especially in Europe, which weighs on growth and pricing activity; (2) FCA's high reliance on the market in North America which seems to have reached its peak and on the Jeep and Ram brands; (3) still low profitability in Europe (-0.5% EBIT margin as adjusted by company in Q3 2019) despite a solid growth in car demand over the last 4 years; (4) transition risk of the industry towards alternative fuel vehicles and autonomous driving technologies.

WHAT COULD CHANGE THE RATINGS UP

With respect to the merger, positive rating pressure could build once we have more clarity on timing and financial implications of the merger transaction as well as comfort that the combined entity can sustain credit metrics commensurate with an investment grade rating during a period of potentially weaker market conditions.

Qualitatively, upward pressure on FCAs rating could materialize if the company is able to demonstrate a successful and sustainable improvement in its competitive position outside the North America region in particular Europe and China. Furthermore the company needs to implement and successfully execute a profitable and resilient competitive position for its Alfa Romeo and Maserati brands. An upgrade would also require sustainability in FCA's current operating profitability and cash flow generation, even if market conditions were to weaken in the US and in Europe as well as its track record in successfully addressing tougher emission standards without being a leader in supporting technologies.

Quantitatively, an upgrade could occur if FCA were able to achieve (1) a Moody's-adjusted EBITA margin sustainably above 6%, (2) a consistently positive and robust free cash flow without compromising on its capital expenditures and R&D expenses needed to achieve emission targets, to manage the transition to alternative fuel vehicles and new drivetrain technologies as well as autonomous vehicles and (3) keeping its leverage based on Moody's-adjusted (gross) debt/EBITDA sustainably below 2.0x.

WHAT COULD CHANGE THE RATINGS DOWN

FCAs ratings might come under downward pressure should FCAs operating performance and cash flow generation come under significant pressure as a result of market share declines or if market conditions were to weaken in the US and in Europe.

A downgrade could occur in case these events would result in the following credit metrics for a sustained period of time: (1) a Moody's-adjusted EBITA margin falling below 4%, (2) a sizable negative free cash flow, or (3) a Moody's-adjusted (gross) debt/EBITDA exceeding 3.0x.

Outlook Actions:

..Issuer: Fiat Chrysler Automobiles N.V.

....Outlook, Changed To Positive From Stable

..Issuer: Fiat Chrysler Finance Europe SA

....Outlook, Changed To Positive From Stable

Affirmations:

..Issuer: Fiat Chrysler Automobiles N.V.

.... Corporate Family Rating, Affirmed Ba1

.... Probability of Default Rating, Affirmed Ba1-PD

....Senior Unsecured Shelf, Affirmed (P)Ba2

....Other Short-Term, Affirmed (P)NP

....Senior Unsecured Medium-Term Note Program, Affirmed (P)Ba2

....Senior Unsecured Regular Bond/Debenture, Affirmed Ba2

..Issuer: Fiat Chrysler Finance Europe SA

....Other Short-Term, Affirmed (P)NP

....Senior Unsecured Medium-Term Note Program, Affirmed (P)Ba2

....Senior Unsecured Regular Bond/Debenture, Affirmed Ba2

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Automobile Manufacturer Industry published in June 2017. Please see the Rating Methodologies page on www.moodys.com for a copy of this methodology.

CORPORATE PROFILE

Having its corporate seat in Amsterdam, the Netherlands, and its principal executive offices in the United Kingdom, FCA is one of the world's largest automotive manufacturers by unit sales. Its portfolio of automotive brands includes Abarth, Alfa Romeo, Chrysler, Dodge, Fiat, Fiat Professional, Jeep, Lancia, Ram and Maserati. In 2018, FCA generated consolidated net revenues of EUR110.4 billion and reported an adjusted EBIT of EUR6.7 billion (both excluding Magneti Marelli).

REGULATORY DISCLOSURES

For ratings issued on a program, series, category/class of debt or security this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series, category/class of debt, security or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody's rating practices. For ratings issued on a support provider, this announcement provides certain regulatory disclosures in relation to the credit rating action on the support provider and in relation to each particular credit rating action for securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.

For any affected securities or rated entities receiving direct credit support from the primary entity(ies) of this credit rating action, and whose ratings may change as a result of this credit rating action, the associated regulatory disclosures will be those of the guarantor entity. Exceptions to this approach exist for the following disclosures, if applicable to jurisdiction: Ancillary Services, Disclosure to rated entity, Disclosure from rated entity.

Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.

Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.

Please see the ratings tab on the issuer/entity page on www.moodys.com for additional regulatory disclosures for each credit rating.

Falk Frey
Senior Vice President
Corporate Finance Group
Moody's Deutschland GmbH
An der Welle 5
Frankfurt am Main 60322
Germany
JOURNALISTS: 44 20 7772 5456
Client Service: 44 20 7772 5454

Anke Rindermann
Associate Managing Director
Corporate Finance Group
JOURNALISTS: 44 20 7772 5456
Client Service: 44 20 7772 5454

Releasing Office:
Moody's Deutschland GmbH
An der Welle 5
Frankfurt am Main 60322
Germany
JOURNALISTS: 44 20 7772 5456
Client Service: 44 20 7772 5454

No Related Data.
© 2019 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their licensors and affiliates (collectively, “MOODY’S”). All rights reserved.

CREDIT RATINGS ISSUED BY MOODY'S INVESTORS SERVICE, INC. AND ITS RATINGS AFFILIATES (“MIS”) ARE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MOODY’S PUBLICATIONS MAY INCLUDE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES. MOODY’S DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT OR IMPAIRMENT. SEE MOODY’S RATING SYMBOLS AND DEFINITIONS PUBLICATION FOR INFORMATION ON THE TYPES OF CONTRACTUAL FINANCIAL OBLIGATIONS ADDRESSED BY MOODY’S RATINGS. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS AND MOODY’S OPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT OR HISTORICAL FACT. MOODY’S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS OR COMMENTARY PUBLISHED BY MOODY’S ANALYTICS, INC. CREDIT RATINGS AND MOODY’S PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. NEITHER CREDIT RATINGS NOR MOODY’S PUBLICATIONS COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. MOODY’S ISSUES ITS CREDIT RATINGS AND PUBLISHES MOODY’S PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE, HOLDING, OR SALE.

MOODY’S CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY’S CREDIT RATINGS OR MOODY’S PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER.

ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY’S PRIOR WRITTEN CONSENT.

CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT IN THEM BEING CONSIDERED A BENCHMARK.

All information contained herein is obtained by MOODY’S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as well as other factors, however, all information contained herein is provided “AS IS” without warranty of any kind. MOODY'S adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. However, MOODY’S is not an auditor and cannot in every instance independently verify or validate information received in the rating process or in preparing the Moody’s publications.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability to any person or entity for any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with the information contained herein or the use of or inability to use any such information, even if MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers is advised in advance of the possibility of such losses or damages, including but not limited to: (a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant financial instrument is not the subject of a particular credit rating assigned by MOODY’S.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability for any direct or compensatory losses or damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud, willful misconduct or any other type of liability that, for the avoidance of doubt, by law cannot be excluded) on the part of, or any contingency within or beyond the control of, MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with the information contained herein or the use of or inability to use any such information.

NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY CREDIT RATING OR OTHER OPINION OR INFORMATION IS GIVEN OR MADE BY MOODY’S IN ANY FORM OR MANNER WHATSOEVER.

Moody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s Corporation (“MCO”), hereby discloses that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s Investors Service, Inc. have, prior to assignment of any rating, agreed to pay to Moody’s Investors Service, Inc. for ratings opinions and services rendered by it fees ranging from $1,000 to approximately $2,700,000. MCO and MIS also maintain policies and procedures to address the independence of MIS’s ratings and rating processes. Information regarding certain affiliations that may exist between directors of MCO and rated entities, and between entities who hold ratings from MIS and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually at www.moodys.com under the heading “Investor Relations — Corporate Governance — Director and Shareholder Affiliation Policy.”

Additional terms for Australia only: Any publication into Australia of this document is pursuant to the Australian Financial Services License of MOODY’S affiliate, Moody’s Investors Service Pty Limited ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136 972 AFSL 383569 (as applicable). This document is intended to be provided only to “wholesale clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, you represent to MOODY’S that you are, or are accessing the document as a representative of, a “wholesale client” and that neither you nor the entity you represent will directly or indirectly disseminate this document or its contents to “retail clients” within the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion as to the creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors.

Additional terms for Japan only: Moody's Japan K.K. (“MJKK”) is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’s Overseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization (“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registered with the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively.

MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any rating, agreed to pay to MJKK or MSFJ (as applicable) for ratings opinions and services rendered by it fees ranging from JPY125,000 to approximately JPY250,000,000.

MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.

​​​​​​
Moodys.com