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“Car business will change drastically in the next ten years”

“Car business will change drastically in the next ten years”

Wednesday, 16 de November de 2016

On a visit to Brazil, Sergio Marchionne, global chief executive of Fiat Chrysler Automobiles (FCA), spoke about the challenges of today’s market and the opportunities for the car of the future

He is the man behind the 2014 merger between the giants Fiat and Chrysler; he is the man with a Bachelor’s degree in Philosophy, an MBA and a Law degree under his belt, in addition to being the CEO of Fiat SpA since 2003. With his decisive style, he traced the strategic alliance between the two groups and designed the merger at Fiat Chrysler Automobiles (FCA). In a typical move to his managerial approach, he landed in Recife in late September to coordinate the meetings for the top executive body – the Group Executive Council – and participate in the launching events for the Jeep Compass in Brazil.

Italian born and naturalized Canadian and key executive for trade relations between Italy and the United States, Sergio Marchionne arrived in Brazil noting that the country has a key role in the group’s global business. He received journalists from Brazil as well as from neighboring Latin American countries for a chat that lasted about an hour.

Check out below the highlights of the interview with the FCA chief executive:

 

“One thing you need to know about Jeep”

“In 2009 Jeep sold about 300,000 cars. We’ll sell a million and a half this year. It has grown five times in six years. And this installation now [The Jeep Automotive Center in Goiana, Pernambuco], with the launch of the Compass, will help diffuse the brand on a global scale, side by side with markets such as China, India and the United States. So we are investing in the right places.”

 

The end of the crisis

“My expectation is that we will probably see some improvement in the Brazilian market [Automotive market] by the second or third quarter of 2017. The gradual recovery signs are already here. But we must be cautious. It will not happen overnight. We have to have patience with Brazil. It is in times like these that one must not despair. This is a country that is as young as it is ingenious. I have full confidence that Brazil will emerge from the current crisis. I have no doubt about that. And the rest of the world wants Brazil to come out of the crisis. From time to time you need to be able to emerge from what is taking place in order to see the future through it. It will be much better. ”

 

“We are fortunate that the market is down”

“The business [automobile] consumes a lot of capital. If you look at what happened here in Brazil, when we built [the Jeep Automotive Center],the market was completely different in 2012 for both Brazil and Latin America. On the one hand, the investment was made and the market lost almost half its volume. On the other hand, we are lucky that the market is low, because it allows us to return to the Fiat Automotive Center [in Betim, Minas Gerais] and make all the changes necessary without losing sales volume. Betim was producing one car every 20 seconds. The market was too strong and intervening in the factory at that point in time would have been an absolute disaster. Now the change is happening one step at a time and I think that in four years the plant in Betim will be unrecognizable. We hope that by then the Brazilian market will have resumed its growth.”

 

Autonomous cars by 2017

“[Our partnership with Google is going] well and we are very excited about this relationship. I think you will see our first vehicles in the first quarter of next year. Once the technology becomes widely accepted, the cost of autonomous driving will not be very big. You can make it available to most consumers at a reasonable price and this will be an excellent tool to improve quality of life. There are many situations in which your real desire to drive is not that big. For example, if you get stuck in a stop and go traffic jam, there is nothing you can do… There are better ways to spend your time than to sit there and drive like a robot just trying to avoid hitting something. The machine will do the job as good as you, if not better. The automotive business will change dramatically in the next decade. The fact that we have been chosen by Google to be a partner in development is an indication that FCA is willing to embrace change and work with people who are not traditionally carmakers and interested in entering that arena. We must remain completely open to opportunities of this magnitude.

 

Alternative Fuels

“We understand the value of ethanol. You need to continue fostering it. It is a significant solution in terms of environmental impact and when you follow the numbers, you see that the cheapest way to bring down emissions [carbon] is through ethanol. Dollar for dollar, there is no better way to do this. That being said, I say that electrification will be present in all of our cars within the next five years. But don’t count on electrification to be the only solution. “

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