Fiat SpA's Overall Net Loss Narrowed

ROME February 28, 2005; The AP reported that Fiat SpA reached key operating break-even for 2004, while its overall net loss narrowed slightly last year to euro1.55 billion (US$2.05 billion), the company said Monday. The group had reported a net loss of euro1.9 billion (US$2.5 billion) in 2003.

The closely watched Fiat Auto unit reported a net loss of euro840 million (US$1.1 billion), also a slight improvement from the previous year's euro979 million (US$1.2 billion). Total revenues for the carmaking unit were euro20.5 billion (US$27.1 billion), marking barely a change from the previous year's euro20 billion ($26.4 billion).

Total revenues for Fiat SpA were $46.7 billion (US $6.1 billion), the company reported.

The results were released about two weeks after Fiat SpA won independence from U.S. giant General Motors Corp. and as analysts had reported mixed expectations.

Fiat executives have acknowledged in recent months that the automaker's turnaround -- which is key to the group's fortunes -- was proceeding more slowly than hoped.

Fiat has vowed to turn its entire attention to its ailing carmaking division, Fiat Auto. Earlier this month, in a move aimed at speeding up the unit's recovery, group Chief Executive Sergio Marchionne took the reins of the unit, ousting Herbert Demel, an Austrian who had been on the job for about 15 months.

On Feb. 13, Fiat and General Motors dissolved a partnership including an option that could have forced GM to buy the 90 percent of Fiat Auto SpA that it did not already own. GM agreed to pay the Italian automaker US$2 billion (euro1.5 billion), mostly in exchange for canceling the clause.