THE FIAT GROUP IN

PRODUCT INNOVATION AND INVESTMENTS
The Sector focused its product innovation and development
programs primarily on the repowering of its line of intermediate
vehicles (Eurocargo Tector) and designing a new range of
V-shaped engines for electric power generation and rail
transport applications.
In addition, it proceeded with the planned implementation of
an investment program to expand its engine line. It developed
new families of light and medium diesel engines, built a facility
that manufactures crankshafts for light and medium engines,
and developed a new cab that will be installed on the Stralis,
a new heavy vehicle.
Irisbus continued to invest in product innovation, placing
particular emphasis on the development of the CiVis, a new mass
transit vehicle with an electric or hybrid propulsion system.
At the end of 2001, the Sector agreed to purchase from
Renault the 50% interest in the Irisbus Group it did not own.
This transaction will be completed in 2002, giving Iveco
complete control of this bus manufacturer.
For the year as a whole, capital expenditures rose to about
718 million euros (656 million euros in 2000). This amount
includes 348 million euros invested in the Sector’s fleet of
lease vehicles.
During the year, Iveco and CBC, a Chinese group, signed
an agreement establishing a 50-50 joint venture that will
manufacture and distribute urban and long-distance busses.
CBC is one of the largest producers of mass transit vehicles
in China and leads the domestic urban transportation market.
Revenues by business unit
9%
26%
11%
15%
12%
27%
Light commercial vehicles
Medium commercial vehicles
Heavy commercial vehicles
Busses/Special vehicles
Engines
Services
Bolstered by the positive performance of its innovative vehicles
and engines and the successful completion of its capital
investment programs, Iveco stands ready to take advantage of all
available growth opportunities. The full integration of Irisbus into
Iveco will enable the Sector to play a leading role in the global bus
market as well.
RESULTS FOR THE YEAR
In 2001, Iveco’s net revenues increased to 8,650 million euros,
up slightly from the figure reported in 2000, as growth by its
financial and service businesses offset a decrease in vehicle
sales.
Operating income amounted to 271 million euros (489 million
euros in 2000). The return on sales was 3.1%, down from
5.7% in 2000. This decline is due mainly to the combined
impact of lower unit sales and a reduced contribution from
asset sales, which in 2000 included a gain of 88 million
euros on the disposal of industrial sites no longer used by
the Sector.
In 2001, Iveco laid out a plan that will permit an in-depth
restructuring of its industrial operations in Argentina and
produce major operating efficiencies. This plan required the
Sector to set aside sufficient reserves to defray the related
extraordinary charges, which had a significant negative impact
on the bottom line. For the year as a whole, Iveco reported a
consolidated net loss of 123 million euros (consolidated net
income of 147 million euros in 2000).
Depreciation and amortization totaled 410 million euros in 2001
(423 million euros in 2000), while research and development
outlays came to 215 million euros (227 million euros in 2000).
The Sector’s interest in the net loss came to 125 million euros,
compared with an interest in net income of 146 million euros
in 2000.
In 2001, cash flow totaled 287 million euros, down from
569 million euros in 2000.
Iveco worldwide
Rest Rest of
Italy of Europe the world Total
Production facilities 11 24 10 45
R&D centers 16 15 2 33
Dealers 73 307 198 578
Iveco is continuing to expand its international operations,
strengthening its position in the emerging markets of South
America and East Asia and broadening its sales organization in
Eastern Europe.
Report on Operations – Iveco
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