SMART just recently announced they will be leaving the U.S. and reorienting towards China. Could Fiat be throwing in the towel in the U.S.? It could be if the signal of investment location is the tea leaf to be read. While the Fiat brand has nearly disappeared in China and rapidly fading in the US, they are targeting the Brazilian market, Europe, and emerging markets in their new 5-year plan.
Fiat has been struggling in the U.S. for year, and in spite of fielding 4 models, Fiat moved just 15,521 vehicles in the U.S. in 2018, a decline of 41% over 2017. Sales continue to fall in 2019, down another 42% YTD as of April 2019.
According to a report in Bloomberg, Fiat is investing $4 billion in South America to expand and build two new SUVs for the South American market. The money will go towards expanding capacity at a Jeep factory in Pernambuco to 350,000 from 250,000 per year as well as building a new factory to build engines. Fiat plans to release 15 new, refreshed, or special series vehicles in Latin America by 2024. Jeep and Ram will get an additional 10.
Latin America is the only region other than North America where FCA made money in first quarter 2019, however Fiat's market share has been falling from first place in 2015 to third place today. At the same time, Jeep has been expanding in South America from near 0% share as recently as 2014. Fiat brand is most popular in Brazil.
While the 5-year plan does not yet signal an exit from the U.S. market, the reorientation of resources to markets other than the U.S. could be a signal that the end could be near for Fiat brand in the U.S.