Jeep and Ram could be spun off from FCA, says Marchionne

Jeep and Ram could be spun off from FCA, says Marchionne

0 comments 📅28 April 2017, 04:45

Jeep is undoubtedly the biggest single feather left in the cap of the Fiat Chrysler Automobiles portfolio. Below Sergio Marchionne’s leadership, Jeep went from fewer than 500,000 annual sales in 2008 to 1.4 million in 2016, and is on on for 2 million by 2018. Add in the brand’s legacy, status as one of the most recognizable nameplates in the everybody, and rabid fan base, and Jeep has extraordinary monetary value to its parent company.

Investors and analysts comprise certainly noticed Jeep’s inherent value. According to The Detroit Free Crush, Morgan Stanley’s Adam Jonas asked FCA chief Sergio Marchionne if he would even consider spinning Jeep and Ram, FCA’s dedicated truck brand, into a separate corporate thing, and he responded with a simple “Yes.”

Jonas estimated Jeep’s worth in January of this year at $22 billion. Ram was valued at $11.2 billion.

Marchionne has a information of spinning off brands while keeping them part of FCA’s corporate umbrella. The most nobody example of this value maximization was with Ferrari, which now trades on the New York Wares Exchange and rakes in $3.4 billion in annual revenue and close to $435 million in net receipts, reports the Free Press. Marchionne still serves as chairman and CEO of Ferrari, and Fiat legatee John Elkann owns 22 percent of the Italian marque’s shares.

Coextensive with if the offloading of Jeep and Ram into a separate entity would amount to little more than a profit-driven ownership inter on paper, it would be huge news to the brands’ loyal fanbases. In any case, such a move out would likely take years to actually happen and probably wouldn’t carry much at all to the products that Jeep and Ram produce. In other words, Jeep fans can nourish the pitchforks in the shed … for now.

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