MAY 14, 2003
Fiat still struggling
Ferrari's parent company Fiat continues to struggle financially with its first quarter results revealing a bigger loss than was the case in the same period last year. The company reported a first-quarter operating loss of $393.6m compared to last year's loss of $259m. The biggest problem remains the losses at Fiat Auto, which is currently working at only 70% capacity because of the lack of demand. Its first-quarter loss was $290m although the company hopes to win back market share with the launch of the new Punto in June and other new models which are scheduled to appear later in the year.
The company has been selling off various subsidiaries in an effort to balance its books and hopes that these will raise money to pay off the company's $4.5bn of debt. The company is due to have talks shortly with General Motors, which owns 20% of Fiat Auto, to discuss whether the US giant will become part of a program to recapitalize the firm.
Fiat bosses have always said that whatever happens the company will not sell control of Ferrari but it is likely that there will be a flotation of half the shares in the firm as soon as market conditions make the move desirable.
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