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Will Fiat Chrysler’s Stock Continue to Rally after a Flat 2016?

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Dec. 4 2020, Updated 10:53 a.m. ET

FCAU’s 2016 US sales

In 2016, Fiat Chrysler Automobiles (FCAU) sold about 2.24 million vehicle units in the US market, compared to 2.25 million units in 2015, a minor YoY (year-over-year) fall of 0.4%. 

In this article, we’ll find out whether FCAU’s stock could continue to rally in 2017 by looking closely at its 2016 sales.

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Jeep and Ram sales rise

In 2016, Fiat Chrysler’s two key brands, Jeep and Ram, saw their sales inch upward. The company sold 926,000 Jeep brand vehicles, a rise of 6% YoY, and 546,000 Ram brand vehicles, a rise of 11% YoY.

Note that the Ram and Jeep brands are the key strengths of Fiat Chrysler’s product portfolio. These two brands help the company to maintain its position in the US pickup truck segment. Currently, Ford Motor Company (F), General Motors (GM), and Toyota Motor (TM) are among the major competitors for Fiat Chrysler in this segment.

Among other key brands, the sales of the Chrysler, Dodge, and Fiat brands fell 27%, 4%, and 24%, respectively, in 2016. The 2016 sales of Alfa Romeo, Fiat Chrysler’s luxury brand, fell 22% YoY. With these falls, the company’s total car sales fell 17% YoY to 585,000 units. In contrast, the sales of its utility vehicles and trucks remained strong in 2016, rising 35% and 11%, respectively.

Will FCAU’s stock continue to rally?

If we look at automakers’ performances in 4Q16, FCAU has significantly outperformed not only its peers but also the broader market. In 4Q16, its stock rose ~42.5%, much more than GM’s and Ford’s rises of 9.7% and 0.5%, respectively. The S&P 500 Index (SPY) rose 3.3% in 4Q16.

Despite minor falls in its total US sales in 2016, Fiat Chrysler managed to post a solid YoY rise in its heavyweight vehicle sales, reflecting optimism. We can’t deny the possibility of its stock trading on a firmer note in the near term.

Continue to the next article to learn about Toyota’s US auto sales in December 2016.

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