Fiat (FCAU) Mulling to Recall More Than 900K Vehicles in US
Fiat Chrysler Automobiles N.V. FCAU is set to recall more than 1.2 million older minivans and SUVs worldwide over faulty airbag covers. Plastic emblems on the steering wheels, which are held by clips could loosen over time and become projectiles if the driver's air bag gets inflated in a crash.
The recall includes about 925,239 of its older model vehicles in the United States to replace airbag covers on their steering wheels, after 14 reports of drivers being injured due to the problem.
The recall covers minivans from the 2008 and 2010 model years, including Chrysler Town & Country and Dodge Caravan, as well as Dodge Nitro SUVs from 2007 to 2011. Owners will receive notice of the recall from the next month. Dealers will replace the steering wheel airbag cover at no cost to customers.
Meanwhile, Fiat is seeking options to reduce a planned cash compensation to its shareholders, which is part of the company’s collaboration deal with France’s PSA Groupe, including the spin-off of assets. Reducing or canceling the 5.5-billion euro ($6.2 billion) special dividend will help the new group hoard cash at a time when the coronavirus pandemic has crippled the auto industry, and will hurt sales and production in the days ahead.
Fiat was also recently guaranteed 6.3 billion euros ($6.9 billion) in loans from Italy’s biggest retail bank — Intesa Sanpaolo — subject to the car maker securing a state guarantee, which will cover 80% of the amount borrowed. The loan reportedly includes conditions not to relocate or cut jobs as the firm merges with PSA.
Zacks Rank and Stocks to Consider
Fiat currently carries a Zacks Rank #3 (Hold). Shares of the company have depreciated 31.5%, year to date, compared with the industry’s decline of 11.2%.
Some better-ranked stocks are Niu Technologies NIU, LCI Industries LCII and Brilliance China Automotive Holdings Ltd. Unsponsored ADR BCAUY, each carrying a Zack Rank of 2 (Buy) at present. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Shares of Niu have surged 148.4%, year to date, as against the industry’s decline of 11.3%.
Shares of LCI Industries have appreciated 1.6%, year to date, as against the industry’s decline of 11.2%.
Shares of Brilliance have rallied 9.3%, year to date, as against the industry’s decline of 11.3%.
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Fiat Chrysler Automobiles N.V. (FCAU) : Free Stock Analysis Report
LCI Industries (LCII) : Free Stock Analysis Report
NIU TECHADR (NIU) : Free Stock Analysis Report
Brilliance China Automotive Holdings Ltd. Unsponsored ADR (BCAUY) : Free Stock Analysis Report
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