Categories Consumer, Markets

Fiat comes to Detroit just as GM plans to leave

Fiat Chrysler Automobiles NV (FCAU) is planning to reopen one of its factories in Detroit to build its Jeep Grand Cherokee SUVs. The company is seeing good sales for SUVs and trucks and plans to focus more on utility vehicles for growth.

The plant, which was closed around six years ago, will now be used to build SUVs in order to meet the strong demand for these vehicles. Production will reportedly start by 2020. However, Fiat has provided no official confirmation for these plans.

This news comes at a time when Fiat’s peers are cutting jobs and announcing restructurings even as President Donald Trump is urging companies to increase production and create more jobs in the US. General Motors (GM) is still dealing with the aftermath of its recent decision to cut 15% of its workforce and close five of its facilities in North America.

General Motors takes hard decisions on restructuring and job cuts

This decision includes the closures of two of GM’s plants in Detroit, both of which were said to have been operating under capacity. GM opted for the restructuring to focus more on the profitable areas of its business and to do away with the weaker parts. Economic weakness and trade tensions were also said to have played a part in GM’s decision.

GM’s CEO Mary Barra met with Congress members who questioned the company’s decisions. The GM chief defended the actions as necessary for long-term growth. Barra promised to keep an open mind but did not make any solid commitment with regards to the company’s plans.

Fiat’s shares have dropped 12% so far this year while GM’s shares have fallen 14%. As of 11:40 am ET, Fiat’s stock was down 1.9% while GM’s stock was down 1.8%.

 

We’re on Apple News! Follow us to receive the latest stock market, earnings and financial news at your fingertips.

Most Popular

Does Unity Software (U) stock has more room to run?

Last month, the IPO market was in a full swing. IPOs of Snowflake (NYSE: SNOW) and JFROG (NASDAQ: FROG) had an impressive opening day in September, the former creating a

PepsiCo (PEP): Steady snacking habits amid pandemic drive strong quarter for beverage giant

PepsiCo Inc. (NASDAQ: PEP) beat market expectations on both revenue and earnings for the third quarter of 2020. The company saw the momentum continue in its snacks business while the

Does the virus-driven boom make Electronic Arts (EA) a good investment?

With more and more people turning to virtual entertainment sources, amid the virus-related movement restrictions, video game publishers like Electronic Arts (NASDAQ: EA) are witnessing unusually high demand. Not surprisingly,

Leave a Reply

Your email address will not be published. Required fields are marked *

Add Comment
Loading...

Cancel
Viewing Highlight
Loading...
Highlight
Close
Top