Pope Francis’s Endorsement Could be Boost for Fiat-Chrysler Stock
After Pope Francis’ Alitalia Airbus 300 arrived from Havana, he was picked up in an official Fiat 500L. This contrasted sharply to the giant GM Suburban vehicles that escorted the Italian car, making it appear almost Lilliputian in their shadow.
Suspicions of a holy alliance between Fiat Chrysler Automobiles N.V. (NYSE:FCAU) and the Vatican were confirmed by the company’s market performance, which has been higher than any other manufacturer this year.
Chart courtesy of www.StockCharts.com
Compared to the huge Chevrolet 4×4, and offering its backseat passengers similar amounts of room, the 500L looks like a toy. When you compare the Italian car’s 1.4 liter four-cylinder to the American’s 5.7 liter V8, the contrast is more striking still.
Fiat 500L: The New Pope-Mobile?
The pontiff will avail the services of six Fiat 500sL and an open “Pope-mobile” derived from a white Jeep (also made by the Fiat Chrysler group) to visit the cities of Washington, New York, and Philadelphia. Blessed are the shareholders of Fiat-Chrysler Automobiles N.V. stock.
It was certainly charming, maybe even odd, to see Pope Francis aboard a Fiat 500, especially in America. It accentuated his sober and charming image across the road that separates the Andrews Air Force Base from the Vatican embassy in Washington DC. That short stretch will travel a long way for Fiat.
None other than Pope Jorge Mario Bergoglio waved to the crowds from the backseat of the Fiat 500L, which is actually very spacious. At this point, we just have to wait and see if Pope Francis might persuade President Obama to take a ride in the five-door version of Fiat’s popular car. After all, President Obama’s admiration of Pope Francis is genuine. He has treated this pope as no other foreign leader visiting the United States.
This pope fascinates millions of Americans because he speaks the language of ordinary people and because his message is hopeful and pragmatic, promoting real change. He knows how to combine religion and politics as only few historical leaders of the past have been able to do. “I, the son of an immigrant family, am happy to be a guest in this country,” he said as he promptly landed his feet into the pot of American politics, accentuating the differences between those who support Trump on migrants to those who advocate less radical views.
Indeed, his choices are powerful in their simplicity. After all, Francis is the Pope who has set out a new course for the Church. Nothing fascinates most Americans more than a new frontier from the conquest of the West to the landing on the Moon and beyond.
On his first day in the U.S., it became clear how popular this pontiff of change has become for millions of Americans. Never mind that on issues such as abortion and gay marriage, the Pope remains opposed. But who knows; he may even change his view on these.
A Blessed Testimonial for Fiat Chrysler Automobiles N.V.
What brand wouldn’t want the Pope as a testimonial? In fact, it was even better than a testimonial for Fiat; it was the kind of advertising that no agency can offer and that no sum of money can buy. It was literally divine intervention. Francis chose to travel with a 500L—Fiat’s best-selling U.S. model.
Indeed, the Pope’s choice of car for his visit to the White House may have truly blessed the company. This just a week after its Alfa Romeo brand earned the title of “Queen of the Frankfurt Auto Show” with the new Giulia. Additionally, its other brand, Ferrari, won their latest Formula One grand prix.
Pope Bergoglio, faithful to his usual moderation, rejected mega SUVs or arrogant limousines, preferring the humble but spacious Fiat 500L which featured the official Vatican State flag and SCV 1 plates. The car certainly reflects Francis’ praise of modesty. The pope was not intending to do marketing for Fiat, but Sergio Marchionne, FCAU’s CEO, no doubt conceded a smile.
By choosing a Fiat 500L to travel from Washington to the White House, Pope Francis said to The Times of London that he had two messages: the aversion to opulence and the commitment to combat climate change with fewer emissions. For Fiat, this was the triumphant marketing message as competitor Volkswagen endures the blow of an EPA investigation of its Diesel engines.
Fiat Chrysler Automobiles N.V. Wins Dow Jones Award
Earlier this year, Fiat Chrysler Automobiles won the prestigious Dow Jones Sustainability World Index award, recognizing achievements in economic, environmental, and social; placing FCA among the leading companies in the world. This no doubt helped FCAU stock’s performance. The president of Fiat Chrysler, John Elkann, explained that in 2016 “we will make a million cars in Italy alone […] Just three years ago, the total production in Italy by Fiat was lower than 400,000 cars.”
In 2015, the share instead will be about 900,000 units. FCA will achieve a jump in production this year and next, said Elkann, thanks to new products on the way; including the Maserati Levante at Mirafiori and the Alfa Romeo Giulia in Cassino.
Fiat Chrysler Automobiles Benefits from “Dieselgate”
Volkswagen Group (a major competitor of Fiat) shares have collapsed in the markets under the wave of the “Dieselgate” scandal. Analyst Max Warburton from Bernstein Research said that Volkswagen risks being “seen as the Lance Armstrong of car manufacturers.” Toyota and GM may even regain their top spots as the world’s largest car manufacturers at year-end, relegating the VAG group to second or third place.
For now, though, analysts are ready to bet that Volkswagen will succeed in overcoming the present shock, which goes beyond its own factory floor. The VAG group may have damaged the whole of the German car industry according to Dr. Ferdinand Dudenhoeffer, head of the CAR (Center for Automotive Research) Institute. He suggests that if a company openly bragging about Made-in-Germany engineering through its slogans and commercials are caught violating anti-pollution laws by cheating, the stain of suspicion muddies the company’s own image as well as other German brands like BMW and Mercedes.
Sponsored Content: (Video) Something Very Big Will Happen in America in the Next 180 Days
The markets, as well as Pope Francis, have also blessed Fiat-Chrysler compared to other car companies this year. Ferrari won the last grand prix of Formula One. The Alfa Romeo has had a huge success in the heart of the German motor industry at the Frankfurt Auto Show with its new model Giulia. The fall of the gods was on stage at the Frankfurt Stock Exchange with Volkswagen stock as the protagonist.
Volkswagen shares sank, losing more than 20%. The capitalization of the leading global car company with no fewer than 14 brands under its umbrella lost more than $20.0 billion in the markets. This is about what it will have to pay as a fine to U.S. authorities for its EPA violations.
BMW could also be affected by the emissions problem affecting Volkswagen insinuated by the German car magazine Auto Bild. According to them, the X3 diesel emits 11 times more pollutants in regular use than it does during the initial certification road test. “BMW does not manipulate its vehicles, does not distinguish between road and laboratory tests,” retorted the Bavarian car company, failing to prevent its shares from dropping 10% on the news. Auto Bild has retracted the accusations. But the suspicion remains. (Source: No indication of tampering with BMW, Auto Bild, September 24, 2015.)
Fiat Chrysler Stock to Rise
However, the markets cannot measure the value of image. Now, the image of the world’s most beloved man being chauffeured in a humble Fiat is worth more than mere numbers on a stock performance chart. The enhanced image will contribute to Marchionne’s ambitions and surely Fiat Chrysler stock.
The rules imposed by the supervisory authorities in Europe and the United States, too often in contradiction, have greatly increased auto companies’ production and development costs. Not to mention the stress of intense competition.
And so, despite the company’s image of booming health at first glance (Fiat Chrysler has more debts than cash), FCAU’s boss has long called for alliances and mergers to reduce the costs in a sector that needs loads of cash to survive.
Doubtless, Marchionne will continue to press for a merger with General Motors Company (NYSE:GM), which may well succumb to his strategy. The temporary demise of Volkswagen will only make his job easier. Legend has it that the Roman emperor Constantine converted to Christianity after he defeated invaders on the Milvian Bridge in 313 A.D. as promised by an apparition of the Cross, marked by the words, “In hoc signo vinces” (in this sign you will conquer). The Pope arriving at the White House in a Fiat 500 may well be the sign of the Fiat Chrysler Group’s ultimate success in conquering GM as well as global auto market.