|Bid||13.30 x 4000|
|Ask||13.35 x 3200|
|Day's range||13.20 - 13.27|
|52-week range||12.11 - 16.69|
|Beta (5Y monthly)||2.14|
|PE ratio (TTM)||5.70|
|Forward dividend & yield||0.73 (5.41%)|
|Ex-dividend date||19 May 2019|
|1y target est||18.75|
Fiat Chrysler will soon resume full production at plants it operates in China through its joint venture with Guangzhou Automobile Group (GAC) , a spokesman said on Wednesday, following extended shutdowns due to the Coronavirus. The plant in Guangzhou restarted production on Feb. 17 while production at the plant in Changsha will resume shortly, the spokesman said, without giving a specific date. Fiat said on Friday it had temporarily halted production at its Serbian plant because of a shortage of parts from China -- the first such suspension by an automaker in Europe.
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(Bloomberg Opinion) -- The Covid-19 virus is a human tragedy for many who have been affected by it and it’s having a profound impact on the lives of a large part of the Chinese population. The impact on the rest of the world of the disease’s dislocation of the Chinese economy is yet to be fully felt. Forecasts of only a modest impact on oil demand worldwide are far too optimistic.A comparison of the latest forecasts from the world’s three big oil agencies — the International Energy Agency, the U.S. Energy Information Administration and the Organization of Petroleum Exporting Countries — highlights the huge uncertainty that exists over the virus’s repercussions for oil demand. As may be expected for a body representing oil producers, OPEC sees the impact as minimal, having just cut its first-quarter forecast for global oil demand by only 400,000 barrels a day. That looks like wishful thinking. The IEA’s revision is three times as big, and if its forecast bears out, it’s deep enough to tip the world into its first year-on-year drop in demand in more than a decade.China’s own oil consumption is down sharply as factories stay closed and travel restrictions remain in place even after the extended Lunar New Year holiday comes to an end. Congestion on roads in major cities is far below normal levels. The chart below shows journey times in Shanghai, and other Chinese cities mirror that pattern. My colleagues at BloombergNEF estimate that China’s jet fuel use is now down by 240,000 barrels a day from pre-virus levels, with departures from Chinese airports down by around 80%.Pollution statistics also capture the slowdown in economic activity and fuel use — something that under different circumstances might be reason to celebrate. China’s nitrogen dioxide emissions fell 36% in the week after the holiday from the same period a year earlier, according to the Centre for Research on Energy and Clean Air. A slowdown of 25%-50% across industrial sectors such as oil refining, coal-fired power generation and steel production contributed to the drop, according to the independent research organization.However, even as the Covid-19 virus hits consumption, the number of very large crude carriers hauling cargoes to China has risen. That’s because independent refiners are taking advantage of the drop in crude prices to fill their storage tanks with cheap cargoes, even as they cut run rates. That’s to some extent cushioning producers now. But those stockpiles will hit future demand for crude from China’s teapot refineries, even after the immediate effect of the virus dissipates.At the same time, the Chinese government is in the process of building and filling a strategic stockpile similar to the U.S. Strategic Petroleum Reserve, as it becomes ever more dependent on imported supplies. It may also be using the price drop to boost purchases for long-term storage, raising the risk that it will cut them again as prices recover, crimping demand for imported oil in the future. By contrast, China’s state-owned processors are seeking to reduce the volumes supplied under term contracts.Even with reduced refinery runs, China is producing more fuel than it needs. Exports of gasoline and diesel have soared, according to shipping intelligence firm Vortexa. But they aren’t finding ready buyers. Most of these additional fuel exports are ending up in storage tanks in Singapore amid subdued regional demand.That brings us back to concerns over just how bad the reverberations from Covid-19 will be. The China of 2020 is very different to that of 2003, and so today’s epidemic is likely to have a much bigger international impact than the SARS virus to which it is most often compared. For a start, China’s oil consumption now is more than twice what it was when SARS hit and last year the country accounted for more than three-quarters of the growth in global oil demand, according to the IEA.In the past 17 years, China has also become much more closely linked to the rest of the world economy. Chinese travelers accounted for about 20% of total spending on tourism in 2018, according to the United Nations World Tourism Organization, while China itself was the fourth most popular destination. The virus will effect both of those figures in 2020.The country has also become the center for producing and exporting both finished goods and components. “All the signs are that there has been a major dislocation in global supply chains,” according to Caroline Bain, chief commodities economist at Capital Economics. For some products, “it’s only going to get worse in February data.” Lack of parts from China has already forced Hyundai Motor Co. and Kia Motors to halt some car production temporarily in South Korea, while Fiat Chrysler Automobiles NV plans to do the same in Serbia. Just-in-time supply chains are starting to show their fragility. There will be more to come as shipments from Chinese ports continue to suffer delays. South Korea’s government says economic impact from the virus is “unavoidable.” The impact won’t stop at South Korea.In that light, OPEC’s forecast that global oil demand will be cut by just 440,000 barrels a day in the first quarter and by 230,000 barrels a day over the year as a whole looks like wishful thinking on the part of producers. It is doing them no favors, though. A delay in reducing supplies will only make the cuts needed later even deeper.To contact the author of this story: Julian Lee at email@example.comTo contact the editor responsible for this story: Melissa Pozsgay at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Julian Lee is an oil strategist for Bloomberg. Previously he worked as a senior analyst at the Centre for Global Energy Studies.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Fiat Chrysler (FCA) said on Friday it had temporarily halted production at its Serbian plant, the first such suspension by an automaker in Europe in response to the coronavirus outbreak in China. Planned downtime at the Kragujevac plant in Serbia, where FCA builds its Fiat 500L car, has been rescheduled "due to availability of certain components sourced in China", a spokesman for the Italian American automaker said. Chief Executive Mike Manley said last week that disruptions to auto parts production in China could threaten output at one of FCA's European plants within two to four weeks.
(Bloomberg) -- Fiat Chrysler Automobiles NV dealers in New York escalated a months-long feud with the manufacturer regarding its sales practices by threatening to sue over incentives that may disadvantage smaller stores.The cease-and-desist letter sent this month by the New York State Automobile Dealers Association is the starkest indication yet of tensions that Bloomberg News first reported in November. The frustrations spring from Fiat Chrysler adopting a system that attempts to anticipate the types of vehicles dealers are likely to order and aligns those internal analytics with manufacturing.Mismatches between the models Fiat Chrysler has been building and the cars and trucks that dealers actually order saddled the company with tens of thousands of unassigned vehicles last year. The automaker has cleared that inventory by offering incentives that have been cause for consternation at the dealer level.Fiat Chrysler has been sending daily emails to dealers across the country offering $1,500 “bonus cash coupons” to entice them to take cars from its inventory pool, according to the letter Robert Vancavage, the president of the New York dealers association, sent to Reid Bigland, the automaker’s U.S. sales chief. Dealers can apply the coupons to any model. The more cars and trucks they agree to take on from the pool, the more funds they get from the manufacturer to help sell cars without sacrificing their own profits.“A larger dealer with broader spending resources allotted for vehicle acquisitions will have an unfair advantage over a smaller dealer,” Vancavage wrote in the Feb. 6 letter, which was viewed by Bloomberg News. “In practice, the programs have created discriminatory and illegal two-tiered pricing in favor of larger, competitive Fiat Chrysler dealers compared to smaller dealers.”Vancavage didn’t respond to requests seeking comment on the letter. A Fiat Chrysler spokesman declined to comment.Dealers have said Fiat Chrysler’s practices amount to running a sales bank. The decades-old practice is frowned upon in the industry because it’s seen as a way for manufacturers to put off having to slow production.Fiat Chrysler has disputed the characterization and said the buildup of unassigned cars has been a side effect of a data-driven production strategy that it says is reducing costs. The company expects to keep boosting profit this year by increasing sales of Ram pickups as it finalizes a merger with France’s PSA Group.Dealers typically place orders with manufacturers about a month in advance of taking delivery, and the company tailors production to meet that demand. Vancavage wrote that the approach Fiat Chrysler has taken lately “appears to be outside FCA’s normal vehicle allocation to dealers.”In September, Fiat Chrysler agreed to pay a $40 million penalty related to filing years of sales reports the U.S. Securities and Exchange Commission said were fraudulent. The agency investigated after a disgruntled dealer filed an antitrust lawsuit that was later settled.To contact the reporter on this story: Gabrielle Coppola in New York at email@example.comTo contact the editors responsible for this story: Craig Trudell at firstname.lastname@example.org, Tony RobinsonFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg Opinion) -- On one side of the Atlantic, Tesla Inc. is capitalizing on its soaring share price by selling $2 billion in stock so it can build more electric vehicles. On the other, French manufacturer Renault SA has been forced to cut its dividend by 70% and announce a big reduction in fixed costs so it can afford to do the same.Dwindling profits and Renault’s drastic remedies were mirrored this week by its Japanese alliance partner Nissan Motor Co., as well at Daimler AG. (Renault has an engineering partnership with Daimler and owns a small stake in the German car and truck maker.) Their problems aren’t identical but all three had expanded their workforces in anticipation of demand that hasn’t materialized and now they have to tighten their belts to pay for expensive electric vehicles, for which demand remains uncertain. Renault’s shares are near their lowest level in eight years, which means the company is capitalized at barely 10 billion euros ($11 billion), a sum that includes the 43% stake Renault owns in Nissan. Needless to say, that’s a sliver of what Tesla is worth, even though the U.S. company’s annual output is still almost a rounding error for the Renault-Nissan alliance. This juxtaposition sends a crystal clear message: Carmakers that grew fat and happy producing combustion engine vehicles won’t get any help from the stock market now that they’ve decided to embrace an electric future. Instead the gasoline gang are going to fund these changes themselves and it’s going to be painful, for both employees and shareholders.Long-established automakers have decided that their salvation is to be found in alliances and partnerships, which spread the cost of developing expensive technology over a greater number of car sales. It’s why Renault tried to merge with Fiat Chrysler Automobiles NV, before Peugeot-owner PSA Group beat them to it. But in Renault’s case its links to other manufactures are amplifying its problems right now, not solving them. Relations with Nissan fell apart when former alliance boss Carlos Ghosn was arrested and remain fragile now that he’s free to settle scores. Both sides have since hired new CEOs but their shareholders aren’t yet ready to buy the story that harmony has been restored.With its own profits slumping, Nissan can’t afford to pay big dividends to Renault and the French are also earning less from the Daimler partnership. The upshot is that Renault is a bit squeezed for cash — net cash at the automotive unit dwindled to just 1.7 billion euros at the end of December (though gross liquidity, including available credit lines, was a more respectable 16 billion euros). One way Renault could free up some money would be to sell part of its Nissan stake, which might have the added benefit of helping to re-balance the alliance in Nissan’s favor, something the Japanese have long sought. The trouble is Nissan’s shares have halved in value over the last two years so selling now wouldn’t provide Renault with nearly as much as it once would. Interim CEO Clotilde Delbos all but ruled out such a move on Friday.So it’s no wonder that Renault has opted to drastically scale back its own dividend and will try to cut costs by 2 billion euros in the next three years. Delbos, who’s also the chief financial officer, didn’t go into much detail about how those savings will be delivered but the company plans to review its “industrial footprint,” which suggests plant closures are a possibility. (Alliance partner Nissan has already announced 12,500 job cuts, while Daimler is targeting at least 10,000.)Lowering costs won’t be straight forward. New Renault CEO Luca de Meo, a former Volkswagen AG executive, doesn’t start until July and French unions aren’t known for championing efforts to slash jobs. In the near term, restructuring costs will also put further pressure on Renault’s cash flow and the coronavirus could yet create unexpected problems. But unlike at Tesla, Renault doesn’t have a queue of wealthy supporters clamoring to help fund this epochal clean-vehicle transition. One way or other, employees and existing shareholders will end up paying.To contact the author of this story: Chris Bryant at email@example.comTo contact the editor responsible for this story: Melissa Pozsgay at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Chris Bryant is a Bloomberg Opinion columnist covering industrial companies. He previously worked for the Financial Times.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Investment group Exor will have around $13 billion in cash provided it closes a deal to sell its reinsurance unit PartnerRe and it would spend most of that on acquisitions, a source close to the matter told Reuters. The holding group of Italy's Agnelli family, which also controls Fiat Chrysler , said on Sunday it was in exclusive talks to sell PartnerRe to France's Covea. The deal could be worth around $9 billion in cash and drove shares in Exor up by more than 5% on Monday to an all-time high.
(Bloomberg Opinion) -- The billionaire Agnelli family is being tempted with the possibility of exiting the reinsurance industry with a sack of cash. Who wouldn’t succumb? The only question is whether the $9 billion approach for their PartnerRe business can be turned into a real deal, and what to do with the proceeds if a transaction happens.French mutual insurer Covea has approached the Agnelli-controlled investment company, Milan-listed Exor NV, about buying Partner Re, Bloomberg News revealed this weekend. At the mooted price, a transaction would be at a roughly 50% premium to the business’s last reported tangible book value of $6.1 billion, but less than 20% above its valuation in Exor’s last annual results. That suggests the final price could be higher. Analysts at Bank of America Merrill Lynch reckon $10 billion would be fairer, noting that European peers trade at a 70% premium to tangible book value.Such an exit would be a good outcome for the Agnellis. PartnerRe was acquired for $6.9 billion in early 2016. It’s hard to see how holding on could deliver the same payback in the near future. This is a specialized industry and PartnerRe’s future surely lies in teaming up within the sector, rather than staying within a diversified investment company.Whether Covea is the appropriate partner remains to be seen. It’s not hard to guess what motivated its approach. Covea is a mutual insurer with stacks of excess capital and no shareholders to distribute it to. M&A is the natural means to put that financial resource to work. This partly drove a failed takeover approach for reinsurer Scor SE in 2018 — along with the risk that Scor, capitalized at 6.9 billion euros ($7.6 billion), might itself do a deal with PartnerRe.Covea has no shareholders to object to it overpaying, but its board and regulators need to be sure of the strategic and financial logic of a jumbo acquisition. Its core business is conventional general insurance. Reinsurance would bring diversification, but also a fresh test for Chief Executive Officer Thierry Derez.In normal times, Derez might get the benefit of the doubt. But the Scor debacle has left unfinished business. Scor is suing him for breach of trust (he was on the target’s board prior to the approach). The French insurance regulator has reportedly criticized the very public row. It has written to Covea seeking improvements to its governance, according to Les Echos. Covea rejects Scor’s allegations as groundless.The French suitor’s ability to close any deal unchallenged is open to doubt, though. An all-share tie-up with Scor remains the obvious alternative for PartnerRe. That would be consistent with Exor’s strategy to make the group a more meaningful rival to the likes of industry giants Munich Re and Swiss Re AG.Still, a generous cash deal would be preferable. It would be more likely to narrow the discount at which Exor shares trade relative to underlying asset value — slightly more than 20%, based on BAML estimates for 2019. The impending special dividend on Exor’s shares in Fiat Chrysler Automobiles NV following the carmaker’s combination with Peugeot SA won’t on its own move the group into a net cash position from its current 2.4 billion euros of net debt.Markets may be expensive right now but that won’t last forever. Building a war chest for opportunistic dealmaking in other sectors makes sense for the Agnellis.To contact the author of this story: Chris Hughes at email@example.comTo contact the editor responsible for this story: James Boxell at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Chris Hughes is a Bloomberg Opinion columnist covering deals. He previously worked for Reuters Breakingviews, as well as the Financial Times and the Independent newspaper.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- French insurer Covea is in advanced talks with the Agnelli family’s Exor NV to buy the Italian company’s reinsurance business PartnerRe for about $9 billion in cash, according to people familiar with the discussions.Covea approached Exor with an offer for the Bermuda-based reinsurer and is in exclusive talks with the holding company, which also controls Fiat Chrysler NV and Ferrari NV, said the people, who asked not to be identified as the discussions are private.Exor and Covea confirmed the exclusive discussions, which were first reported by Bloomberg. Talks “are ongoing and there is no certainty that they will result in a transaction,” Amsterdam-based Exor said in a statement late Sunday.Exor shares rose as much as 4.9% in Milan trading, giving the company a market value of 17.6 billion euros ($19.3 billion).Exor, led by Agnelli scion John Elkann -- who’s also chairman of Fiat and Ferrari -- agreed to buy PartnerRe in 2015 valuing the company at about $6.9 billion. That was part of a plan to diversify assets away from the capital-intensive automotive industry. A sale for $9 billion in cash would mark a significant gain for the Italian billionaire clan.The Agnelli family owns 53% of Exor through a separate holding company which takes its name from Fiat founder Giovanni Agnelli and pools dozens of his descendents as its investors.Exor won a hostile takeover battle for PartnerRe in 2015, breaking up a merger agreement between the reinsurer and Axis Capital Holdings Ltd. A sale of the company would be another major deal for Elkann just months after Fiat Chrysler agreed to combine with PSA Group to create the world’s fourth-biggest carmaker.“A disposal of PartnerRe would increase the M&A appeal on Exor on top of the Fiat-PSA deal and CNH Indutrial’s spinoff plan,” Mediobanca analysts wrote in a note to clients. Fiat will pay a special dividend of 5.5 billion euros with the completion of the PSA deal and CNH Industrial plans to separate its truck unit at the beginning of next year. Exor owns 27% of CNHI and 29% of Fiat Chrysler.The acquisition of PartnerRe would help Covea diversify its business beyond home, auto, life and health insurance coverage. Insurers and reinsurers are under pressure from low to negative interest rates at which they have to invest a large chunk of their premiums. Insurers thus have turned to deal-making and ways of diversifying their revenue streams, including moves into reinsurance and asset management.If successful, it would be biggest deal in the industry since Axa SA bought XL in 2018 for $15.3 billion. Covea abandoned efforts to buy its French rival Scor in 2019, ending one of the country’s most acrimonious takeover attempts in recent years. Reinsurers insure risks of primary insurers such as Covea and have themselves been subject to pricing pressure and consolidation in the industry.\--With assistance from Chiara Remondini.To contact the reporters on this story: Tommaso Ebhardt in Milan at email@example.com;Geraldine Amiel in Paris at firstname.lastname@example.org;Jan-Henrik Förster in London at email@example.comTo contact the editors responsible for this story: Chad Thomas at firstname.lastname@example.org, Jerrold Colten, Guy CollinsFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Fiat Chrysler has reached a settlement with Italian tax authorities over the valuing of its U.S. Chrysler business involving no cash payment or penalty, the group's chief financial officer said. In December the carmaker challenged a claim by the Italian tax agency saying it had underestimated the value of its U.S. business by 5.1 billion euros (£4.3 billion) after acquiring Chrysler. According to a source at the time, the agency's audit of transactions dating back to 2014 could have left FCA facing a tax bill of $1.5 billion.
The threat from the coronavirus crisis closed in on the global auto industry on Thursday, as Fiat Chrysler Automobiles NV warned that a European plant could shut down within two to four weeks if Chinese parts suppliers cannot get back to work. The next several weeks will be critical for automakers. Parts made in China are used in millions of vehicles assembled elsewhere, and China's Hubei province, epicentre of the coronavirus outbreak, is a major hub for vehicle parts production and shipments.
(Bloomberg) -- The Chinese doctor who issued an early warning about the coronavirus has died, said the hospital where he worked, ending hours of confusion about his status.The city of Wuhan told residents to begin reporting their body temperature daily, and the large port city of Tianjin said it would restrict residents’ movement, part of steps across the country to stop the coronavirus outbreak from spreading. In Beijing, the Chinese government voiced anger as countries placed more restrictions on travelers.Tesla temporarily closed its stores in the nation, and Fiat Chrysler Automobiles NV warned that a China-related parts shortage could force it to idle a European plant, according to a report. Equities rose on China’s plans to cut tariffs on U.S. imports and optimism the global economy can withstand the impact of the virus.Bloomberg is tracking the outbreak on the terminal and online.Key DevelopmentsChina death toll at 563; mainland cases at 28,018, with 3,859 severeWhy Reports of Drugs for Coronavirus Are Premature: QuickTakeWhat You Need to Know About the Spreading Coronavirus: QuickTakeMan vs. Microbe: We’re Not Ready for Next Global Virus OutbreakTerminal subscribers: Join TOPLive Q&A on risks to the economyChinese Doctor Has Died, Hospital Says (3 p.m. NY)Li Wenliang, the Chinese doctor who was one of the first to warn about the coronavirus in Wuhan, has died, according to the hospital where he worked.The doctor’s status had been subject to hours of confusion after earlier reports of his death on Chinese social media were deleted and replaced by messages saying he was being treated.“Li Wenliang, an ophthalmologist at our hospital had unfortunately been infected when he worked on fighting against the coronavirus outbreak,” Wuhan Central Hospital said in a post on the Chinese social platform Weibo.The hospital said he died at 2:58 a.m. in China “after all efforts to save him failed.”Li was in his 30s, according to a report by the Chinese media outlet Caixin.Social Media Posts About Doctor’s Death Are Deleted (2:14 p.m. NY)Confusing reports emerged about the status of the Chinese doctor, Li Wenliang, who was earlier reported dead, after posts about his death by a Chinese state media-affiliated publication were removed from social media.The doctor had been one of the first to warn about the coronavirus in Wuhan, but had been reprimanded by local authorities for doing so.Posts by the Global Times, which is affiliated with the Communist Party’s People’s Daily, saying the doctor had died were deleted from the social media platform Weibo sometime before midnight in Beijing. Another post mourning the doctor by Hu Xijing, the Global Times’s editor-in-chief, was also deleted.They were replaced later with suggestions the doctor was alive. Hu said in a Weibo post around 1 a.m. Beijing time that attempts were still being made to save Li. “We wish a miracle of life could happen,” Hu said.Bloomberg earlier reported Li’s death, citing a person familiar with the matter and state-affiliated media. The doctor had been infected with coronavirus before his death.Li’s reported passing quickly became a trending topic on the Chinese social-media platform Weibo around midnight local time, with the hashtags DoctorLiPassedAway and LiWenliangPassedAway attracting hundreds of millions of views. The World Health Organization, which had posted a tweet mourning Li, issued an update saying it had no information his status.The Wuhan doctor became well-known after, in early December before the outbreak of coronavirus exploded, he posted a warning on a social media platform about a SARS-like illness. Days after his warning, he was reprimanded by police for rumor-mongering online, according to his social media account.Canadian Evacuation From Wuhan Begins (2 p.m. NY)Canada’s first evacuation of citizens from Wuhan is underway.A plane with 194 people on board was stationed at a Wuhan airport and set to depart as soon as passengers go through the screening and boarding process. A separate U.S. plane will take a smaller number of Canadians; the two planes combined will account for two-thirds of the 347 Canadians who requested assistance evacuating.Another Canadian plane will depart Feb. 10 with the remaining passengers, Minister of Foreign Affairs Francois-Philippe Champagne said at a press briefing.Canada has reported five cases of coronavirus infection; three in Ontario and two in British Columbia.Report Claims Attempts to Save Chinese Doctor (1:01 p.m. NY)Confusing reports emerged about the status of the Chinese doctor, Li Wenliang, who was earlier reported dead. The editor of the Chinese state media Global Times, which hours before said that Li had died, said in a social media post that efforts were being made to save him. Wuhan Central Hospital, where Li worked, also said that there were attempts being made to rescue him. Li’s status was not immediately clear.American Airlines Extends Flight Cancelations (12:11 p.m. NY)American Airlines Holdings Inc. extended the suspension of flights to Hong Kong from Los Angeles through March 27, citing reduced demand. Service previously had been scheduled to resume Feb. 21. Flights to Hong Kong from Dallas-Fort Worth remain scheduled to resume Feb. 21.The airline is one of the major U.S. carriers serving China.Chinese Doctor Who Warned of Virus Is Dead (10:30 a.m. NY)A Chinese doctor, Li Wenliang, who was reprimanded by police after warning colleagues about a new respiratory disease emerging in Wuhan, has died after falling ill, according to a person familiar with the matter.Li had been admitted to a hospital in early January and later confirmed to have the coronavirus, according to a post on his social media account. The exact cause of death wasn’t immediately known.Li on Dec. 30 posted in a social media group about a SARS-like illness that within weeks would explode into the coronavirus epidemic that has infected more than 25,000 people. Days after his warning, he was reprimanded by police for rumor-mongering online, according to his social media account. The Chinese Supreme Court later said the police were wrong to have taken the actions they did.The death was reported earlier by the Global Times, a Chinese state-run media organization, and other Chinese outlets. A person familiar with the situation confirmed Li’s death to Bloomberg.Economic Impact Will Be Limited, Envoy Says (9:45 a.m. NY)The impact of the coronavirus outbreak on the Chinese economy will be limited and short-term, the country’s envoy to the European Union, Zhang Ming, said in an interview. Smart investors shouldn’t lose confidence on the country’s prospects, the ambassador told Bloomberg TV.The priority of the Chinese government is to contain the virus and save lives, Zhang said. Asked about any fallout from the outbreak to the China-U.S trade deal, he reiterated that any impact will be limited, though he did acknowledge that the virus will affect both the Chinese and the global economy.Port City of Tianjin to Restrict Residents’ Movement (9:08 a.m. NY)Tianjin, a Chinese port city of some 15.6 million people, said it will restrict movement in residential compounds citywide in an effort to slow the coronavirus’s spread there.The city borders Beijing and has only reported 78 cases and one death so far, but authorities across China have taken drastic measures to slow the virus’s spread outside the center of the outbreak in Wuhan. There are more than 25,000 cases across China, concentrated mainly in Hubei province.Tianjin authorities said that residential areas will check and register people who come into communities, limit the access of deliveries and food orders, and restrict entrances and exits, according to the state media People’s Daily.The notice also calls for keeping track of people with electronic registration systems and enhancing management of rentals.Wuhan Tells Residents to Report Body Temperature (8:35 a.m. NY)The city of Wuhan told residents check their body temperature on a daily basis and report it to local health authorities, part of new steps to contain the coronavirus in the city of 11 million that’s the center of the outbreak.The city is conducting door-to-door inspections as well, and will send someone to check on people displaying a fever, according to a notice posted by the provincial government. People with symptoms will be sent to a community health center for evaluation.Fiat Chrysler Warns Disruption Could Shut Europe Plant (8:33 a.m. NY)Fiat Chrysler Automobiles NV could be weeks away from needing to idle one of its plants in Europe because it’s running out of parts sourced from China, Chief Executive Officer Mike Manley told the Financial Times.Manley said one critical maker of components is putting European production at risk. He didn’t name the company or specify what type of parts, or say which of Fiat’s European factories may have to close.Hyundai Motor Co. said earlier this week it was halting production in South Korea because of the shortage of a wiring component sourced from China.Estee Lauder Cuts Profit Outlook Again, Citing Coronavirus (7:03 a.m. NY)Estee Lauder Cos. cut its earnings outlook for a second straight quarter, saying the coronavirus outbreak in China would crimp demand for luxury cosmetics. ArcelorMittal SA is also slowing steel production in the country after the Beijing extended national holidays due to the outbreak.Chinese Government Calls for Return to Normal Production (6:36 a.m. NY)A meeting chaired by Premier Li Keqiang said resources should be allocated rationally to avoid panic, according to CCTV. Coal, power, oil and gas supplies must be secured. Sixteen provinces will provide medical staff to Hubei.OPEC+ Recommends Output Cut (6:46 p.m. HK)The OPEC+ Joint Technical Committee recommended an output cut of 600,000 barrels a day to offset the demand impact of the coronavirus, a delegate said. The recommendation will still have to be discussed by OPEC+ ministers and the group hasn’t yet agreed on a date for an early meeting.Melco Scraps Plans to Invest in Crown Resorts (6:45 p.m. HK)Melco Resorts & Entertainment Limited pulled out of a deal to invest in Australia’s Crown Resorts Limited, citing a “severe drop” in tourism to Asia and Macau’s decision to close casinos following the coronavirus outbreak.Tesla Temporarily Closes China Stores, CNBC Says (6:22 p.m. HK)Tesla has temporarily closed its stores in China as of Feb. 2, CNBC reported, citing a WeChat post from an unidentified company sales employee on that date. It wasn’t immediately clear if closures also applied to Hong Kong. The company had previously said it expects a delay in Model 3s built in Shanghai.Tesla China didn’t respond to a Bloomberg request for comment and Tesla US declined to comment.Separately, Nikkei Asian Review said Honda would extend Wuhan site closures until late February and that Toyota might prolong its production halt at Wuhan plants.Hong Kong Banks Plan Temporary Relief Measures (6:03 p.m. HK)Measures being considered include principal moratorium on residential and commercial mortgages, fee reductions on credit card borrowing and restructuring of repayment schedules for corporate loans.Indonesia Eyes Empty Islands for Quarantine Hub (5:49 p.m. HK)Indonesia plans to build a medical and rehabilitation center on an uninhabited island to isolate infectious disease victims. The country is yet to record a single case, but has quarantined 243 people on the island of Natuna after they were evacuated from China.China Objects to Countries Imposing Travel Restrictions (5:39 p.m. HK)Authorities in Beijing are growing increasingly angry and have registered “strong objections” with countries imposing harsh travel restrictions on visitors from China.Nations are ignoring recommendations from the World Health Organization and the International Civil Aviation Organization, which have advised against canceling flight routes and limiting travel to affected nations, foreign ministry spokeswoman Hua Chunying said.Coronavirus Cluster Linked to Singapore Business Event (5:35 p.m. HK)A Malaysian woman whose brother caught the coronavirus in Singapore also has the virus, widening a multinational cluster of cases linked to a meeting in the city-state.The 40-year-old woman’s older brother was the first Malaysian to be diagnosed with the pneumonia-causing illness. He was among more than 100 people who had attended a business event at Singapore’s Grand Hyatt hotel.GM China Car JV to Produce Millions of Face Masks (4:24 p.m. HK)SAIC-GM-Wuling Automobile, one of GM’s joint ventures in China, will start making face masks to help ease a shortage caused by the spread of the coronavirus in the country.More Businesses Caution on Virus Impact (4:20 p.m. HK)Volvo Car AB said two plants in China have not reopened and the shutdown would last a “few weeks,” Osram Licht AG also said some of its manufacturing facilities were temporarily shut, while Publicis Groupe SA said it was too soon to quantify the impact from the virus.CNOOC Declares Force Majeure on LNG Contracts (3:10 p.m. HK)China National Offshore Oil Corp. told some suppliers it won’t take delivery of liquefied natural gas cargoes, a rare step that shows how deeply the coronavirus is impacting global commodity flows.It’s among the first reports of a so-called force majeure clause being invoked in the global commodity market after mounting speculation that Chinese buyers of everything from copper to LNG could be forced to take the step. Separately, the China Iron & Steel Association -- the nation’s most influential mills’ group -- said the situation this quarter that “does not look optimistic.”Japan’s Abe Says Olympics Won’t Be Postponed (2:10 p.m. HK)Prime Minister Shinzo Abe told parliament the Tokyo 2020 Olympics would not be canceled or postponed despite fears about the novel coronavirus. However, travel restrictions have already begun to affect some qualifying events.China Car Sales May Fall Over 10%, LMC Says (12:48 p.m. HK)China’s auto market, the world’s largest, may shrink 10% or more this year if the coronavirus outbreak persists through the third quarter, researcher LMC Automotive said.That’s the worst of three scenarios outlined by the researcher and involves the virus undergoing further mutations and the epidemic not being contained until late in the year, LMC said in a note to clients. More likely would be for the outbreak to be under control by June, resulting in industry sales falling 3% to 5% in 2020, it said.China Offers Incentives to Firms Helping Battle Virus (12:09 p.m. HK)China is stepping up efforts to contain the spread of the new coronavirus with a series of relief measures for companies directly engaged in the fight against the disease.The steps include reduction in value-added taxes and nudging banks to offer loans carrying interest rates of less than 1.6% for key enterprises that produce, sell or transport essential medical products and daily necessities, China’s State Council said on its website last night. Separately, the nation’s airlines will also be exempt from a civil aviation fund fee starting Jan. 1, it said.Commodity Shippers Face ‘Crisis in Demand’ (11:27 a.m. HK)The global commodity-shipping industry faces an extremely challenging quarter as the impact of the coronavirus outbreak in China adds to other headwinds including seasonally low demand and the impact of recent fuel-rule changes, according to IHS Markit.The spreading health emergency in Asia’s top economy, the world’s largest importer of iron ore, has sent shock waves through raw material markets, and the companies that ferry goods across the world’s oceans. Freight rates have swooned amid gathering indications that demand for cargoes will slump.There are signs of congestion building up at ports, and reports mills are cutting output, Rahul Kapoor, global head of commodity analytics and research for maritime and trade, told Bloomberg Television.Want to Avoid Virus on a Plane? Wash Your Hands (9:37 a.m. HK)Forget face masks and rubber gloves. The best way to avoid the coronavirus on a flight is frequent hand washing, according to a medical adviser to the world’s airlines.The virus can’t survive long on seats or armrests, so physical contact with another person carries the greatest risk of infection on a flight, said David Powell, a physician and medical adviser to the International Air Transport Association. Masks and gloves do a better job of spreading bugs than stopping them, he said.Read the full story here.Vietnam Quarantines Ships From China Ports: VietnamPlus (9:24 a.m. HK)Ships arriving at Vietnam’s northern Haiphong city port that have visited China in the last two weeks will be quarantined to prevent the spread of novel coronavirus, news website VietnamPlus reported.The regulation went into effect Feb. 4, the report said, citing a regulation of the port authority under the Vietnam Maritime Administration.Japan Finds 10 More Cases on Cruise Ship (8:35 a.m. HK)Japan’s Health Ministry said it found an additional 10 cases of the novel coronavirus on a quarantined cruise ship off Yokohama. That would bring the total number of cases on the vessel to 20.The Diamond Princess was placed under quarantine this week before it reached Japan and checks were conducted after a passenger from Hong Kong who had been on the ship tested positive for the virus.More than 7,000 passengers and crew are being held in quarantine in Hong Kong and Japan as their cruises turned into confinement. In Hong Kong, the cruise ship World Dream, owned by Genting HK’s Dream Cruises, was quarantined after three travelers who disembarked in China were diagnosed with the coronavirus.The new infections bring to 45 the number of people in Japan confirmed to have the disease.(Earlier versions of this article were corrected to remove and clarify a reference about an apology to Chinese doctor following reprimand by officials, and to correct the spelling of the city of Tianjin.)\--With assistance from Linly Lin, Kyunghee Park, Chunying Zhang, Isabel Reynolds, Angus Whitley, Krystal Chia, Haidi Lun, Takashi Hirokawa, Abbas Al Lawati, Belinda Cao and Shelly Hagan.To contact Bloomberg News staff for this story: Michelle Fay Cortez in Minneapolis at email@example.com;Jason Gale in Melbourne at firstname.lastname@example.org;Drew Armstrong in New York at email@example.com;Dong Lyu in Beijing at firstname.lastname@example.org;Haze Fan in Beijing at email@example.comTo contact the editors responsible for this story: Stuart Wallace at firstname.lastname@example.org, ;Drew Armstrong at email@example.com, Mark SchoifetFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Fiat Chrysler Automobiles NV is betting it can deliver even bigger profits in 2020 thanks to surging U.S. sales of its Ram pickup trucks, a critical source of cash to invest in electric vehicles until a planned merger with PSA Group.The Italian-American manufacturer is forecasting adjusted earnings of more than 7 billion euros ($7.7 billion) this year compared with 6.7 billion euros in 2019, according to a statement Thursday. It posted a 16% rise in the fourth-quarter and a full-year record in North America, even as shipments fell.Fiat is playing catch up in developing electric cars, chasing more advanced European rivals including Volkswagen AG and Renault SA. The company largely delayed investment and is now paying the price in the form of a multi-year, 1.8 billion-euro deal to buy emissions credits from Tesla Inc. so it can remain compliant with regulations in the U.S. and Europe.In putting off spending on the shift to electric, Fiat was able to pay down debt and restore profitability. It also focused on shearing low-margin sedans from its lineup to invest in more lucrative truck and SUV models.The company is now planning to roll out plug-in hybrid versions of its Jeep SUVs and an all new electric Fiat 500 city car this year. It’s also looking to electrify the struggling Maserati brand, which suffered a sharp drop in sales last year.Need for Scale“Clearly the merger with PSA also has a potential to accelerate this European transformation,” Chief Executive Officer Mike Manley said on a call with analysts. Gaining scale through the merger “will be paramount to ensure we deliver the cost competitiveness we need” for electric vehicles.In addition to the need to pool investment resources, the latest results also indicate the tie up with PSA is necessary to help Fiat in regions outside North America. Its losses widened in Europe and shipments dropped off in Asia.The coronavirus epidemic in China, which has shuttered car and parts factories, may not help. In an indication of the knock-on effect on global supply chains of parts, Fiat said there is risk it may have to temporarily close a European plant within the next two to four weeks if the outbreak worsens.European DeclineIn the company’s best performing region North America, shipments rose in the latest quarter to 649,000. Ram drove growth while sales of Jeep were more profitable after inventory adjustments. Combined with strong sales in Latin America, the carmaker was able to offset a decline in consolidated shipments in Europe, which remains the weak link.Consolidated deliveries in the Apac region dropped, signaling Manley still has progress to make in turning around the area’s performance. He has worked to reduce losses in Asia after new products in China failed to gain traction with consumers and sales of the luxury Maserati brand plunged amid the first downturn in China’s market in a decade.Fiat Chrysler also announced it had reached an agreement with Italian tax authorities over a claim that the company underestimated the value of its American business by 5.1 billion euros following its phased acquisition in 2014. The company said it recognized 2.5 billion euros in additional taxable gains from the merger, but dodged a hefty tax bill by offsetting that with other tax losses and adjustments.Read more: Italy Claims Fiat Undervalued Chrysler by $5.6 BillionFiat said Thursday the PSA deal is expected to close at the end of the year or in early 2021 and generate 3.7 billion euros in annual synergies.(Updates with CEO quote in sixth paragraph)To contact the reporters on this story: Daniele Lepido in Milan at firstname.lastname@example.org;Gabrielle Coppola in New York at email@example.comTo contact the editors responsible for this story: Anthony Palazzo at firstname.lastname@example.org, ;Craig Trudell at email@example.com, Tara PatelFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
MILAN/DETROIT (Reuters) - Fiat Chrysler posted a 7% rise in fourth-quarter profit on Thursday, boosted by strong business in North America and better results in Latin America as it headed into a merger with France's PSA. In a briefing with analysts, Chief Executive Officer Michael Manley said FCA was still "firm" on its financial guidance for 2020. FCA so far has not reported production shutdowns at plants outside China related to the outbreak.