2006 Annual Report - Fiat SpA
2006 Annual Report - Fiat SpA
2006 Annual Report - Fiat SpA
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Components – Magneti Marelli<br />
Operating Performance<br />
Against the backdrop of a market that expanded 4.3%, Magneti<br />
Marelli increased its revenues by 14.2% on a comparable<br />
consolidation basis.<br />
The major orders booked for new car models will enable<br />
the Sector to further diversify its customer portfolio.<br />
In the first half of <strong>2006</strong>, the Sector sold to <strong>Fiat</strong> Auto S.p.A.<br />
and Sata S.p.A the manufacturing and assembly activities<br />
of the Suspension Systems earmarked for <strong>Fiat</strong> models. These<br />
activities are carried out at the Cassino, Pomigliano d’Arco,<br />
Melfi and Mirafiori plants.<br />
Highlights of the performance of each business unit are<br />
outlined below.<br />
Lighting Group<br />
In <strong>2006</strong>, revenues totalled 1,402 million euros, up 11.2% from<br />
2005.<br />
In <strong>2006</strong>, approximately 80 new production programs were<br />
launched which, together with the positive sales performance<br />
of current products, enabled Magneti Marelli to achieve<br />
significant market shares worldwide for both headlamps (14%)<br />
and taillamps (13%).<br />
In terms of innovation, LED headlamps and taillamps are now<br />
being developed, together with a new concept in optical lenses<br />
for future generations of low-beam headlamps and the world’s<br />
first design for a headlamp unit using LED technology for all<br />
required functions. Reliable manufacturing processes,<br />
competitive prices and high quality standards have enabled the<br />
business unit to maintain excellent relationships with car<br />
makers and attract new orders.<br />
Positive developments in this area included the orders received<br />
from Renault Nissan, and the start of commercial dealings with<br />
Suzuki: an important launching pad for entry onto<br />
the Japanese market.<br />
76 <strong>Report</strong> on Operations Magneti Marelli<br />
Highlights<br />
(in millions of euros) <strong>2006</strong> 2005<br />
Net revenues 4,455 4,033<br />
Trading profit 190 162<br />
Operating result (*) 175 127<br />
Investments in tangible and intangible assets 293 313<br />
- of which capitalised R&D costs 77 67<br />
Total R&D expenses (**) 217 197<br />
Employees at year-end (number) 25,195 24,213<br />
(*) Including restructuring costs and unusual income (expenses).<br />
(**) Including R&D capitalised and charged to operations.<br />
Powertrain (Engine Control)<br />
Revenues for <strong>2006</strong> totalled 882 million euros, an increase of 11.9%<br />
from the previous year. As regards the product mix, demand for<br />
spark ignition engine systems slowed in favour of their diesel<br />
counterparts.<br />
The revenue increase involves all customers of the business line,<br />
in particular <strong>Fiat</strong> Auto and <strong>Fiat</strong> Powertrain Technologies (for a<br />
total of +22%) and customers in the China area. Good sales<br />
performance was also achieved by the Tetrafuel system (which<br />
enables environmentally-friendly vehicles to run on four fuel<br />
types) which combines the ability to meter four types of fuel in a<br />
single control unit, supplied to Fiasa in Brazil. A number of major<br />
product launches also took place, including that for mechatronic<br />
Selespeed systems for PSA and GM-Opel in Europe and for<br />
Chery in China.<br />
Orders received during the year included the Selespeed<br />
applications and gasoline systems for Chery, the gasoline system<br />
for the new Fire engine of <strong>Fiat</strong> Powertrain Technologies, and<br />
Flexfuel systems for Fiasa, Ford and PSA in Brazil.<br />
Cofap Automotive Suspension<br />
In <strong>2006</strong>, the business unit had revenues of 1,103 million euros<br />
(1,052 million euros in 2005), an increase of 20% from the<br />
previous year’s figure on a comparable consolidation basis.<br />
The increase in volumes is connected to the success of <strong>Fiat</strong>’s<br />
new models and the introduction of new products for GM-Opel<br />
and PSA.<br />
Work on product development focused on newly launched<br />
models such as the Bravo, New Ducato, new <strong>Fiat</strong> 500 and other<br />
models for PSA. In terms of innovation, the business unit<br />
worked on projects associated with an evolved version of<br />
the Torcs suspension and the program for the electronic SDC<br />
Synaptic Damping Control system.<br />
Major orders for shock absorbers were booked in <strong>2006</strong> from<br />
Tofas in Turkey, Renault in Romania, <strong>Fiat</strong>, Volkswagen, General<br />
Motors and PSA in Brazil, and General Motors in the United<br />
States. In Europe, the unit was awarded an order for the<br />
complete suspension system on the new <strong>Fiat</strong> 500.<br />
Electronic Systems<br />
Total revenues for <strong>2006</strong> amounted to 534 million euros,<br />
up 4.1% from 2005.<br />
<strong>Fiat</strong> and PSA continued to be the Electronic Systems business<br />
unit’s largest customers, with a significant increase being<br />
recorded for <strong>Fiat</strong> (+28%). As for third parties, there was a sharp<br />
increase in sales to the Volkswagen-Audi group (+50% from 2005).<br />
In <strong>2006</strong>, new products were introduced around the world,<br />
including instrument panels for <strong>Fiat</strong>, Volkswagen and Audi,<br />
antenna modules for Volkswagen and Renault, and a<br />
navigation system for PSA.<br />
Orders were received for the new generation of navigation<br />
systems for PSA and SAIC, the <strong>Fiat</strong> radio/navigation system,<br />
and instrument panels for Audi and Renault.<br />
Exhaust Systems<br />
In <strong>2006</strong>, revenues totalled 533 million euros, a significant<br />
increase of 31.9% from the previous year.<br />
This sharp rise in revenues was fuelled by sales to <strong>Fiat</strong> and<br />
Mercedes, where the latter was supplied with exhaust systems<br />
featuring a DPF diesel particulate filter. Sales also increased in the<br />
Mercosur, thanks to strong demand from local customers.<br />
Major production startups included systems for the <strong>Fiat</strong> Bravo and<br />
New Ducato, and the cold-end exhaust system for Volkswagen.<br />
New orders booked include the DPF system for the 1.3 small<br />
diesel engine of <strong>Fiat</strong> Powertrain Technologies.<br />
Motorsport<br />
Magneti Marelli participates in the major motorsport<br />
championships as a technical partner. In <strong>2006</strong>, it supplied<br />
electronic control systems, fuel system and electromechanical<br />
components, and telemetry and data acquisition systems to the<br />
leading Formula 1 teams. In addition to Formula 1, Magneti<br />
Marelli is also active in other championships. It participates in<br />
the World Rally Championship, supplying electronic control<br />
systems to various teams, and in the Moto GP championship,<br />
where it provided fuel injection and electronic systems to<br />
Yamaha, Ducati and Kawasaki. Magneti Marelli also helped<br />
bring Maserati to victory in the FIA GT1 championship.<br />
<strong>Report</strong> on Operations Magneti Marelli 77