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 upgrades Fiat Chrysler to Ba1 with a stable outlook

15 May 2019

Frankfurt am Main, May 15, 2019 -- Moody's Investors Service, ("Moody's") has today upgraded to Ba1 from Ba2 the corporate family rating (CFR) and to Ba1-PD from Ba2-PD the probability of default rating (PDR) of Fiat Chrysler Automobiles N.V. (FCA). Also, the ratings on senior unsecured instruments issued by FCA and Fiat Chrysler Finance Europe SA have been upgraded to Ba2 from Ba3. The outlook has been changed to stable from positive.

"FCA's upgrade reflects the continued improvements in its credit metrics and Moody's expectation that FCA will be able to sustain these credit metrics even in a more challenging environment with softening demand in some of its key markets and additional costs to comply with upcoming emission requirements," said Falk Frey, a Senior Vice President and lead analyst for FCA.

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

RATINGS RATIONALE

Over the past four years FCA has been able to significantly reduce its historically high gross leverage. The company cut its Moody's gross adjusted debt by more than half within this time period, down from EUR40 billion in 2014 to below EUR20 billion by year-end 2018 supported by a change in financial policy targeting and keeping a net industrial cash position (as reported). Its net industrial cash position is expected to be around EUR4.0 billion by year-end 2019 compared with EUR0.4 billion as of 03/2019 (excluding Magneti Marelli).

Driven by successful new model launches meeting consumer's demand for large SUV's and pick-up trucks in particular in North America and the effects from efficiency improvements, FCA has been able to improve its profitability in North America to the levels of its US automotive OEM competitors. This structural improvement should also make the company more resilient in a cyclical downturn.

In Moody's view, FCA will be relatively less affected by any potential trade tariffs between the US and China or the US and Europe given small market positions in China and a relatively small share of cars imported from Europe to the US.

The recently announced agreement with Tesla on the pooling of both companies' fleet for emission compliance is an important step in Moody's view to avoid paying possible fines for not meeting future emission targets especially in the EU.

FCA's first quarter results have come in weaker against tough comparables last year, which we however expected. FCA's worldwide combined shipments (including shipments from unconsolidated joint ventures) have declined by 14% compared to the previous year's period, declining to 1.0 million vehicles. While overall industry trends in the global passenger car markets are negative, FCA has additionally been impacted by a weakening Argentinian market and non-repeat of overlapping production of the all-new prior generation Jeep Wrangler during Q1 2018 in North America. Further, in the EMEA region, shipments were down due to the planned transition to new commercial strategies.

FCA's reported (unless otherwise noted, all financial figures exclude Magneti Marelli) adjusted EBIT has decreased by around -29% in Q1 2019 compared to Q1 2018, mainly driven by the declining volumes across the regions, partially offset by positive net pricing in North America, leading to a reported adjusted EBIT EUR1.1 billion and an adjusted EBIT margin of 4.4% compared to 5.8% in Q1 2018. FCA maintains its guidance for FY2019 with an adjusted EBIT of at least EUR6.7 billion (adjusted EBIT margin of at least 6.1%).

On a Moody's adjusted basis these reported numbers resulted in an EBITA margin of 5.1% for the LTM March 31, 2019 period (5.5% fiscal year 2018), free cash flow generation (as adjusted by Moody's) of EUR4.1 billion LTM March 31, 2019 (2018: EUR5.6 billion) and a leverage (Moody's adjusted debt/EBITDA) of 2.0x compared with 1.9x in 2018, well in line with the requirements for a Ba1 rating.

For 2019, Moody's anticipates FCA's operating performance and cash flow generation to continue to improve driven by successful new product launches in higher margin pickup truck segments with the launch of the all-new Jeep Gladiator and Ram Heavy Duty models but also the recent launches of the all-new Jeep Wrangler and Ram 1500 pickup, despite a slight decline in US light vehicles demand that Moody's anticipates in 2019 (-2.9%).

FCA's rating remains constrained by a significant dependency on operating performance from its business in the US, with a strong reliance on performance of the Jeep and Ram brands. Given the strong market dynamics there, FCA's numbers are reflective of a cyclical industry that has reached a peak, even though we do not expect a severe decline for the current year. However, a weaker market environment in the US could have adverse effects on FCA's performance and, hence, leverage.

In addition, FCA together with all other automotive OEMs is exposed to the transition risks of the industry towards alternative fuel vehicles, and autonomous driving technologies, which will weigh negatively on future cash flow generation.

LIQUIDITY

As of 31 March 2019, FCA's liquidity profile is considered good, underpinned by EUR11.9billion in reported cash and marketable securities, as well as access to undrawn EUR7.7 billion committed revolving credit facilities (RCFs). The maturities of the main Group's syndicated RCF were further extended in March 2019, with EUR3.1 billion maturing in April 2022 (with two 1-year extension options available) and EUR3.1 billion in March 2024. These funding sources should cover FCA's anticipated cash requirements over the next 12 months, which comprise principally capex, debt maturities, and cash for day-to-day needs.

Stable Outlook

The stable outlook is based on our expectation that FCA will continue to improve its financial metrics further 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.

The stable outlook also assumes that FCA's financial policy will remain conservative with no excessive dividend payouts, a more moderate gross leverage than in the past as well as a solid liquidity profile.

What Could Change the Ratings UP

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.

STRUCTURAL CONSIDERATIONS

We have considered the senior unsecured notes issued by FCA and its treasury companies as structurally subordinated to a significant portion of financial and non-financial debt located at the level of FCA's operating subsidiaries largely consisting of trade payables. Consequently, the ratings of FCA's outstanding senior unsecured bonds is Ba2, or one notch below the Ba1 CFR, according to Moody's Loss Given Default Methodology.

LIST OF AFFECTED RATINGS

..Issuer: Fiat Chrysler Automobiles N.V.

Affirmation:

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

Upgrades:

....LT Corporate Family Rating, Upgraded to Ba1 from Ba2

.... Probability of Default Rating, Upgraded to Ba1-PD from Ba2-PD

....Senior Unsecured Shelf, Upgraded to (P)Ba2 from (P)Ba3

....Senior Unsecured Medium-Term Note Program, Upgraded to (P)Ba2 from (P)Ba3

....Senior Unsecured Regular Bond/Debenture, Upgraded to Ba2 from Ba3

Outlook Actions:

....Outlook, Changed To Stable From Positive

..Issuer: Fiat Chrysler Finance Europe SA

Affirmations:

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

Upgrades:

....BACKED Senior Unsecured Medium-Term Note Program, Upgraded to (P)Ba2 from (P)Ba3

....BACKED Senior Unsecured Regular Bond/Debenture, Upgraded to Ba2 from Ba3

Outlook Actions:

....Outlook, Changed To Stable From Positive

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 or category/class of debt, this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt 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

Matthias Hellstern
MD - Corporate Finance
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