Business
Eyes on Fiat Chrysler's Canadian plants as company merges with Peugeot to create $47-billion auto giant – Financial Post
PSA Group and Fiat Chrysler Automobiles NV will combine to create the world’s fourth-biggest carmaker, as the manufacturers prepare to shoulder the costly investments in new technologies transforming the industry such as automation and electrification.
In the biggest auto tie-up since Daimler’s ill-fated purchase of Chrysler in 1998, the French and Italo-American carmakers will each own half of the enlarged business with combined annual sales of 8.7 million vehicles.
The all-stock transaction brings together two carmaking dynasties — the billionaire Agnelli clan of Italy and the Peugeots of France — and will forge a regional powerhouse to rival Germany’s Volkswagen AG with a market value of about US$47 billion, surpassing Ford Motor Co.
Executives promised not to close any plants in the merger even though the new company aims to extract 3.7 billion euros in annual synergies related to platform and purchasing efficiencies. FCA currently operates two assembly plants in Ontario where it manufactures nearly one quarter of all vehicles made in Canada.
“In the merger there will be no affect on production in Ontario,” FCA chief executive Mike Manley said on a call with reporters Wednesday.
Earlier this year, FCA announced plans to eliminate a third shift and 1,500 jobs at its Windsor, Ont., plant where 6,000 employees build the Chrysler Pacifica, Chrysler Pacifica Hybrid, Chrysler Voyager and Dodge Grand Caravan.
It has since extended the shift until the end of the first quarter in 2020, and will continue to review the feasibility of maintaining the shift, a spokesperson said in an email. It’s too early to comment on whether that extra capacity — if it opens up — could be used to build PSA vehicles in North America, the spokesperson said.
No cuts have been proposed at FCA’s Brampton, Ont., plant where 3,400 workers build the Chrysler 300, Dodge Charger and Dodge Challenger.
While the combined company said its manufacturing footprint will remain stable for now, the executives touted the synergies from sharing technologies and platforms across brands.
The new company will be run by PSA Chief Executive Officer Carlos Tavares, with Fiat Chairman John Elkann holding the same role.
The transaction will take as long as 15 months to complete, pending approvals by shareholders of both companies and by regulators, the carmakers estimated.
Like executives across the industry, Tavares and Elkann are responding to growing pressure to pool resources for product development, manufacturing and purchasing in the face of trade wars and an expensive shift toward electric and self-driving technology.
“The challenges of our industry are really, really significant,” Tavares, 61, said on the call with reporters. “The green deal, autonomous vehicles, connectivity and all those topics need significant resources, strengths, skills and expertise.”
“The technological revolution we are embracing requires a more innovative response than anything we have done before,” Elkann, 43, said in a letter to staff.
In an era when size is becoming ever more important, the deal will turn the two mid-sized carmakers into a global heavyweight, with a stable of popular brands and annual vehicle sales surpassing General Motors Co. The combination will give Peugeot-maker PSA a long-sought presence in North America and should help Fiat gain ground in developing low-emission technology, where it’s lagged rivals.
Mark Nantais, president of the Canadian Vehicle Manufacturers’ Association, said the deal reflects where the auto industry is going and where it needs to go given how expensive it is to develop new technologies.
“That is so capital intensive and there’s only so much money to go around,” Nantais said. “They have to look for partners, they have to look for synergies in order to basically be prepared for the future.”
As for future manufacturing decisions, Nantais expects the companies to choose markets where it can produce more profitably. While Canada has a skilled labour force, infrastructure and the benefit of the new Nafta deal, it also has higher costs for inputs such as electricity, Nantais said.
“We’re still one of the highest cost jurisdictions to produce,” he said.
When it comes to where to locate production and management, Tavares indicted the company will stick to where the brands have roots and manage through regional headquarters.
“The brands carry the passion, the brands carry the history, the brands carry the emotions. This is why we considered that the brands will stay in their countries of origin,” he said. “Italian brands will stay in Italy, French brands will stay in France, American brands will stay in the U.S., and German brands will stay in Germany.”
Yet the new company will face many challenges. It will still be heavily reliant on Europe’s sluggish and saturated auto market, and poorly positioned in China, the world’s largest country for car sales.
The challenges will be manifold, from improving Fiat’s struggling European operations to meeting tough rules on emissions that kick in next year in the region as well as an unprecedented policy known as the green deal demanding an even tougher clampdown on carbon. Tavares, known as a hard-nosed cost-cutter, will also have to navigate the political crosscurrents in France, Italy and the U.S., where the automakers have deep national roots.
He has tackled tough jobs before, leading the French carmaker back from the brink after taking over in 2014, and reviving the loss-making Opel brand after acquiring it from GM two years ago.
“We believe further synergies above the modest 3.7 billion euros announced will be required to justify the combination going forward, which Tavares’ track record makes likely,” Bloomberg Intelligence analyst Michael Dean said in a note.
The deal with Fiat Chrysler marks a reversal of fortune for the 61-year-old executive, who was forced into a bystander role earlier this year when Elkann approached Renault SA, PSA’s French rival. That merger fell apart in early June after Renault’s Japanese partner, Nissan Motor Co., declined to back it.
China’s Dongfeng Motor Corp., which owns 12 per cent of PSA, will see its stake in the combined company decline to 4.5 per cent as a result of the deal and the sale of a portion of its holding to the French carmaker.
Dongfeng’s stake in PSA has attracted attention because of the possibility it could interfere with U.S. regulatory approval. U.S. economic adviser Larry Kudlow said last month the Trump administration would review the proposed merger because the deal would give the Chinese carmaker a stake in the combined company.
Tavares, on the call, said the companies don’t expect any significant issues from the antitrust regulators.
Fiat CEO Manley dismissed concerns over legal and tax issues that arose in recent weeks. GM in November accused Fiat Chrysler of bribing a union in the U.S. for more favourable terms. Manley, speaking with reporters, called the allegation meritless.
Separately, Italian tax authorities have claimed that Fiat owes the government a hefty sum after underestimating Chrysler’s value following its purchase several years ago. Manley reiterated that the case would have no material impact, and said both issues were reviewed during due diligence with PSA.
Manley, 55, who took over at Fiat last year after the sudden death of industry legend Sergio Marchionne, “will be there alongside” Tavares at the combined group, Elkann said in a letter to employees. He didn’t specify what Manley’s role would be.
Before the closing, Fiat will distribute to its shareholders a special dividend of 5.5 billion euros while PSA will distribute its 46 per cent stake in car-parts maker Faurecia SE to its own investors.
The spinoff or sale of Fiat’s robotics arm Comau slated for the benefit of the Italian company’s shareholders has been modified since October. Now, the planned separation will occur after the closing, and shareholders of the combined company will benefit.
Business
CANADIAN ACCOUNTANTS TELL ALL ON STATE OF SMB FINANCES IN NEW SURVEY
Accountants “open the books” on inflation, interest rates, technology, and lack of SMB support
TORONTO – Nov. 19, 2024 – A recent survey of 500 Canadian accountants has revealed several surprising conclusions about their frustrations, fears, thoughts on provincial support for SMBs, the investments that make them wary, and how many clients are actually using the financial technology they need.
And for a little fun, the survey even identified which Canadian celebrity they would back as an SMB CEO.
The survey conducted on behalf of Plooto, a leading payment automation solution for small-to-midsize businesses (SMBs), asked accountants, bookkeepers, and finance professionals a series of revealing questions that provide a snapshot of the current state of Canada’s accounting industry.
Key Findings of the Survey:
- IT’S HARD OUT THERE FOR AN SMB
Asked what they think are the biggest financial threats to Canadian SMBs, more than half of Canadian accountants (54.5%) said ‘inflation increasing their own costs.’ This was followed by interest rates making borrowing rates more expensive (46.1%); staff turnover (41.2%); lower prices offered by larger corporations in the same space (39%); interest rates cooling on consumer spending (34.1%) and foreign competition (32%).
- ACCOUNTANTS CALL OUT ONTARIO’S SMB SUPPORT
Asked which province they think is doing the least to help SMBs succeed, a definitive quarter (24.5%) of accountants cited Ontario. Quebec was a distant second at 15%; followed by Alberta (13.3%); BC (11.4%); Manitoba and Newfoundland and Labrador (tied at 7.25%); Saskatchewan (5.9%); and New Brunswick and PEI (tied at 4.9%). Accountants considered Nova Scotia as the province doing the most for SMBs, with the lowest vote of 4%.
- ACCOUNTANTS SHINE THE LIGHT ON COSTLY SMB MISTAKES
Asked what the biggest financial mistake they see Canadian SMBs make on a regular basis, 21% of Canadian accountants said ‘not implementing the proper technology.’ This was followed by ‘not paying enough attention to cash flow’ (19%); investing in elaborate and expensive workplaces (12.2%); hiring too quickly (10.6%); buying rather than leasing equipment (10%); overpaying to attract a top-tier executive (9.8%); hiring too slowly (9.2%); and funding the first year with non-submitted HST payments (8.0%).
- ACCOUNTANTS HESITATE TO ADVISE INVESTMENT IN ENTERTAINMENT AND EDUCATION
Based on the profitability of their current clients, accountants said they would NEVER invest in: arts, entertainment and recreation (32.2%), educational services (24.5%), travel and hospitality (22.9%), agriculture, forestry, fishing and hunting (19.8%) and; finance and insurance (19.6%).
- THE ECONOMY IS CLEARLY KEEPING ACCOUNTANTS UP AT NIGHT
Asked to choose the factors that are keeping them up at night, 48.8% said ‘current interest rates,’ followed by ‘fear of a recession’ (46.7%); ‘worry that their SMB clients will go under’ (29.6%); the current Federal Government (27.3%); ‘another pandemic’ (26.9%); the 2024 U.S. elections (25.3%.) and; ‘a different Federal Government coming into power’ (25.1%).
- ACCOUNTANT IRRITATIONS UP CLOSE
Asked what the most irritating things their clients do on a regular basis are, Canadian accountants said ‘not sending required information’ (64.7%); not reading financial reports (50.2%); not making time to discuss financial reports (48.4%); not paying invoices on time (47.8%); submitting information with ‘bad math’ (44.5%) and; not listening to recommendations (44.3%).
- SMBs DON’T HAVE ALL OF THE TECH RESOURCES THEY NEED
Accountants say less than a third (31.4%) of clients have all of the tech in place that they need, despite its far-reaching benefits.
When their clients use fintech, 65.1% of clients can reconcile their books faster, and 56% can make and receive payments faster.
Bonus Insight:
RYAN REYNOLDS COULD RULE THE C-SUITE
Asked which Canadian celebrity they thought would be the most effective in running a SMB, nearly a quarter of Canadian accountants said Ryan Reynolds (27.1%). Reynolds edged out business celebrity Kevin O’Leary (22%) and left Keanu Reeves (15.3%), Drake (12.6%), Arlene Dickenson (8.6%), and Michele Romano (4.1%) as distant alternatives.
PLEASE REFER TO THIS AS A SURVEY BY PLOOTO IN ANY MEDIA MENTIONS
Business
Which Candidate Would You Hire? A or B?
Speaking from personal experience, a bad hire isn’t a good look. The last thing you want is to hear, “Who the hell hired Bob?” and have your hiring judgment questioned.
The job seeker who’s empathetic to the employer’s side of the hiring desk, which controls the hiring process, is rare.
One of the best things you can do to enhance your job search is to practice perspective-taking, which involves seeing things from a different perspective.
It’s natural for employers to find candidates who have empathy and an understanding of their challenges and pain points more attractive. Candidates like these are seen as potential allies rather than individuals only looking out for themselves. Since most job seekers approach employers with a ‘what’s in it for me’ mindset, practicing perspective-taking sets you apart.
“If there is any one secret of success, it lies in the ability to get the other person’s point of view and see things from that person’s angle as well as from your own.” – Henry Ford.
Perspective-taking makes you realize that from an employer’s POV hiring is fraught with risks employers want to avoid; thus, you consider what most job seekers don’t: How can I present myself as the least risky hiring option?
Here’s an exercise that’ll help you visualize the employer’s side of the hiring process.
Candidate A or B?
Imagine you’re the Director of Customer Service for a regional bank with 85 branches. You’re hiring a call centre manager who’ll work onsite at the bank’s head office, overseeing the bank’s 50-seat call centre. In addition to working with the call centre agents, the successful candidate will also interact with other departments, your boss, and members of the C-suite leadership team; in other words, they’ll be visible throughout the bank.
The job posting resulted in over 400 applications. The bank’s ATS and HR (phone interview vetting, skill assessment testing) selected five candidates, plus an employee referral, for you to interview. You aim to shortlist the six candidates to three, whom you’ll interview a second time, and then make a hiring decision. Before scheduling the interviews, which’ll take place between all your other ongoing responsibilities, you spend 5 – 10 minutes with each candidate’s resume and review their respective digital footprint and LinkedIn activity.
In your opinion, which candidate deserves a second interview?
Candidate A: Their resume provides quantitative numbers—evidence—of the results they’ve achieved. (Through enhanced agent training, reduced average handle time from 4:32 mins. to 2:43 minutes, which decreased the abandon rate from 4.6% to 2.2%.)
Candidate B: Their resume offers only opinions. (“I’m detail-oriented,” “I learn fast.”)
Candidate A: Looks you in the eye, has a firm handshake, smiles, and exudes confidence.
Candidate B: Doesn’t look you in the eye, has a weak handshake.
Candidate A: Referred by Ariya, who’s been with the bank for over 15 years and has a stellar record, having moved up from teller to credit analyst and is tracking to become a Managing Director.
Candidate B: Applied online. Based on your knowledge, they did nothing else to make their application more visible. (e.g., reached out to you or other bank employees)
Candidate A: Well educated, grew up as a digital native, eager and energetic. Currently manages a 35-seat call center for a mid-size credit union. They mention they called the bank’s call centre several times and suggest ways to improve the caller experience.
Candidate B: Has been working in banking for over 25 years, managing the call center at their last bank for 17 years before being laid off eight months ago. They definitely have the experience to run a call centre. However, you have a nagging gut feeling that they’re just looking for a place to park themselves until they can afford to retire.
Candidate A: Has a fully completed LinkedIn profile (picture, eye-catching banner) packed with quantifying numbers. It’s evident how they were of value to their employers. Recently, they engaged constructively with posts and comments and published a LinkedIn article on managing Generations Y and Z call centre agents. Their Facebook, Instagram, and Twitter/X accounts aren’t controversial, sharing between ‘Happy Birthday’ and ‘Congratulations’ messages, their love of fine dining, baseball, and gardening.
Candidate B: Their LinkedIn profile is incomplete. The last time they posted on LinkedIn was seven months ago, ranting about how the government’s latest interest rate hike will plunge the country into a deep recession. Conspiracy theories abound on their Facebook page.
Candidate A: Notices the golf calendar on your desk, the putter and golf balls in the corner, and a photograph of Phil Mickelson putting on the green jacket at the 2010 Masters hanging on your wall. While nodding towards the picture, they say, “Evidently, you golf. Not being a golfer myself, what made you take up golf, which I understand is a frustrating sport?”
Candidate B: Doesn’t proactively engage in small talk. Waits for you to start the interview.
Which of the above candidates presents the least hiring risk? Will likely succeed (read: achieve the results the employer needs)? Will show your boss, upper management, and employees you know how to hire for competence and fit?
_____________________________________________________________________
Nick Kossovan, a well-seasoned veteran of the corporate landscape, offers “unsweetened” job search advice. You can send Nick your questions to artoffindingwork@gmail.com.
Business
Job Seekers’ Trinity Focus, Anger and Evidence
Though I have no empirical evidence to support my claim, I believe job search success can be achieved faster by using what I call “The Job Seekers’ Trinity” as your framework, the trinity being:
- The power of focus
- Managing your anger
- Presenting evidence
Each component plays a critical role in sustaining motivation and strategically positioning yourself for job search success. Harnessing your focus, managing your anger, and presenting compelling evidence (read: quantitative numbers of achieved results) will transform your job search from a daunting endeavour into a structured, persuasive job search campaign that employers will notice.
The Power of Focus
Your job search success is mainly determined by what you’re focused on, namely:
- What you focus on.
Your life is controlled by what you focus on; thus, focusing on the positives shapes your mindset for positive outcomes. Yes, layoffs, which the media loves to report to keep us addicted to the news, are a daily occurrence, but so is hiring. Don’t let all the doom and gloom talk overshadow this fact. Focus on where you want to go, not on what others and the media want you to fear.
Bonus of not focusing on negatives: You’ll be happier.
- Focus on how you can provide measurable value to employers.
If you’re struggling with your job search, the likely reason is that you’re not showing, along with providing evidence, employers how you can add tangible value to an employer’s bottom line. Business is a numbers game, yet few job seekers speak about their numbers. If you don’t focus on and talk about your numbers, how do you expect employers to see the value in hiring you?
Managing Your Anger
Displaying anger in public is never a good look. Professionals are expected to control their emotions, so public displays of anger are viewed as unprofessional.
LinkedIn has become a platform heavily populated with job seekers posting angry rants—fueled mainly by a sense of entitlement—bashing and criticizing employers, recruiters, and the government, proving many job seekers think the public display of their anger won’t negatively affect their job search.
When you’re unemployed, it’s natural to be angry when your family, friends, and neighbours are employed. “Why me?” is a constant question in your head. Additionally, job searching is fraught with frustrations, such as not getting responses to your applications and being ghosted after interviews.
The key is acknowledging your anger and not letting it dictate your actions, such as adding to the angry rants on LinkedIn and other social media platforms, which employers will see.
Undoubtedly, rejection, which is inevitable when job hunting, causes the most anger. What works for me is to reframe rejections, be it through being ghosted, email, a call or text, as “Every ‘No’ brings me one step closer to a ‘Yes.'”
Additionally, I’ve significantly reduced triggering my anger by eliminating any sense of entitlement and keeping my expectations in check. Neither you nor I are owed anything, including a job, respect, empathy, understanding, agreement, or even love. A sense of entitlement and anger are intrinsically linked. The more rights you perceive you have, the more anger you need to defend them. Losing any sense of entitlement you may have will make you less angry, which has no place in a job search.
Presenting Evidence
As I stated earlier, business is a numbers game. Since all business decisions, including hiring, are based on numbers, presenting evidence in the form of quantitative numbers is crucial.
Which candidate would you contact to set up an interview if you were hiring a social media manager:
- “Managed Fabian Publishing’s social media accounts, posting content daily.”
- “Designed and executed Fabian Publishing’s global social media strategy across 8.7 million LinkedIn, X/Twitter, Instagram and Facebook followers. Through consistent engagement with customers, followers, and influencers, increased social media lead generation by 46% year-over-year, generating in 2023 $7.6 million in revenue.”
Numerical evidence, not generic statements or opinions, is how you prove your value to employers. Stating you’re a “team player” or “results-driven,” as opposed to “I’m part of an inside sales team that generated in 2023 $8.5 million in sales,” or “In 2023 I managed three company-wide software implementations, all of which came under budget,” is meaningless to an employer.
Despite all the job search advice offered, I still see resumes and LinkedIn profiles listing generic responsibilities rather than accomplishments backed by numbers. A statement such as “managed a team” doesn’t convey your management responsibilities or your team’s achievements under your leadership. “Led a team of five to increase sales by 20%, from $3.7 million to $4.44 million, within six months” shows the value of your management skills.
Throughout your job search, constantly think of all the numbers you can provide—revenue generated, number of new clients, cost savings, reduced workload, waste reduction—as evidence to employers why you’d be a great value-add to their business.
The Job Seekers’ Trinity—focusing on the positive, managing your anger and providing evidence—is a framework that’ll increase the effectiveness of your job search activities and make you stand out in today’s hyper-competitive job market, thus expediting your job search to a successful conclusion.
_____________________________________________________________________
Nick Kossovan, a well-seasoned veteran of the corporate landscape, offers “unsweetened” job search advice. You can send Nick your questions to artoffindingwork@gmail.com.
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