The car industry pressured by technology and raw materials costs

The car industry pressured by technology and raw materials costs: As pressures mount on the industry despite rising vehicle sales, climbing technology costs, raw materials, and global currency shifts ate into profits at the world’s carmakers. The US car market seems to recover, thanks to the sales increase in the first quarter.

German groups Volkswagen and Daimler saw material and commodity costs deflate their earnings, while smaller operators Volvo and Mazda flagged rising technology and marketing spending for their profit drops. The outlay from launching new vehicles also took tolls on Fiat Chrysler, General Motors, Volvo, and Daimler, with higher marketing spending and, in FCA’s case, unexpected outgoings to overcome teething problems in its production. Fiat Chrysler’s first-quarter net profit rose 5 per cent to€1.04bn but was damped by close to €1bn in launch costs for its latest technology-packed pick-up truck, the RAM 1500.

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