This is a follow up to this thread.FCA said an internal investigation found overstated sales numbers for last year. Looks like they found 5000 to 6000 more vehicles reported sold than they actually did. Here is the article from the Detroit Free Press. Could get interesting when Sergio reports 2nd quarter numbers to Wall Street Wed.

Interesting, I wonder how many of the 6000 were trucks?

Uh oh...Wonder if this could get expensive for FCA real quick.

What difference does it really make accept to share holders of the corporations? :h

3oaks wrote:What difference does it really make accept to share holders of the corporations? :hRight, fraud never hurts anyone but shareholders...:hFrom innocent employees that lose their jobs to worst case scenarios like Enron.Not that this is the case here but shareholders are not the only ones to feel the impact of things like this.

mich800 wrote:From innocent employees that lose their jobs to worst case scenarios like Enron.I often wonder what distant island W allowed Ken Lay to go live his life out on! His announced death was way to convenient.

FCA Investigation Finds Inflated Sales/update page 2

westernrvparkow
Explorer
Jul 27, 2016
Travlingman wrote:
FCA said today their sales streak actually ended in 2013. They also said that since 2011 they under reported sales by 19,000 vehicles.:h Detroit Free Press
Kind of like when the IRS is investigating you for claiming your dog as a dependent and you respond by saying "but in 1984 I donated my underwear to Goodwill and didn't claim report it as a charitable deduction". Or as the Wizard said, "pay no attention to the man behind the curtain!"
JALLEN4
Explorer
Jul 27, 2016
Perrysburg Dodgeboy wrote:
mich800 wrote:

Right, fraud never hurts anyone but shareholders...:h

From innocent employees that lose their jobs to worst case scenarios like Enron.

Not that this is the case here but shareholders are not the only ones to feel the impact of things like this.

The shareholders won't get hurt as dealer sales have nothing to do with them. Factory sales to dealers not the end consumer are what they care about.

Don

Anyone who actually understands the business knows the "ONLY" thing that counts are retail and fleet deliveries. There is a limit to how many vehicles the dealer pipe-line will accept without sales. When that limit is met, either the manufacturer will need to increase incentives to move product or halt production. Either solution is expensive and ultimately profits are determined by the ability to sell into the retail market. Profits determine share price and is why people invest...not sales to the dealer body!

This is not the first time a manufacturer has been caught "padding" sales. Cadillac had almost an identical situation back in the early 2,000's and executives lost their jobs. These situations usually come from sales executives attempting to prove they are a hero and hoping to eventually "catch up". Those in the industry will tell you that most all manufacturers play games with sales figures at some point whether they are caught or not.
Perrysburg_Dodg
Explorer
Jul 27, 2016
First and the last time! If FCA is cooking the books then whoever is involved needs to be fired. But since nothing ever happens to the big boys and girls at the top (think GM and ignition switch here) it is all a big joke.

Now on to this.
From the DFP "The automaker stressed that its quarterly revenue figures have been accurately reported and unrelated to the way sales figures were being calculated and reported.

After reviewing its sales reporting practices, FCA said it realized that it was possible for dealers to report sales one month and then "unwind" some transactions recorded in its system and return vehicles to the dealer's unsold inventory."

"ronically, FCA now says its internal review discovered that it under-reported sales by nearly 19,000 cars and trucks since 2011. As a result of the changes, FCA's annual sales totals increased in three of the past six years by as many as 14,996 cars and trucks and decreased the other three years by as many as 8,991 vehicles, according to a sales chart the company released Tuesday."

"The sales increase streak is meaningless, but it makes a headline and it’s nice for the company to tout itself,” said Peter Henning, a Wayne State University law professor and a former SEC investigator"

So until the final report comes out the normal FCA haters are going to talk smack.

Don
Dadoffourgirls
Explorer
Jul 27, 2016
The facts are that FCA was using a counting methodology that was different than the other OEMs that allowed them to increase reported deliveries. They counted the first time the VIN was reported delivered, and never took into account any transactions that occurred after the first transaction (a return and additional delivery).

They have now adopted the methodology of the others, that will count a negative one for the return of a vehicle, and a positive one for a delivery.

There statement that they would have reported more sales since 2011 is only true if they would have reported less sales prior to 2011. Changing a counting methodology only works for new vehicles, not for previous vehicles counted in a different manner.
SoCalDesertRid1
Explorer
Jul 27, 2016
Looks like Fiat has been cooking the books.
Bird_Freak
Explorer II
Jul 26, 2016
I can see them padding sales numbers to look better to possible buyers of the company.
mich800
Explorer
Jul 26, 2016
Perrysburg Dodgeboy wrote:
mich800 wrote:

Right, fraud never hurts anyone but shareholders...:h

From innocent employees that lose their jobs to worst case scenarios like Enron.

Not that this is the case here but shareholders are not the only ones to feel the impact of things like this.

The shareholders won't get hurt as dealer sales have nothing to do with them. Factory sales to dealers not the end consumer are what they care about.

Don

One, the dealer network health and trust will impact the OEM. Second, one story was reported that it was dealer deliveries that were in question. Don't let your alliance with FCA cloud your critical thinking. Trust me a positive outcome to this is a good thing. But I also will not shut off my training just because I like this company.

And to add to the comment "dealer sales have nothing to do with them". If the dealers are not selling the quantity they claim they are, who is FCA going to sell to?
patriotgrunt
Explorer
Jul 26, 2016
Am I missing something here? How would FCA not identify this issue much earlier? If they knew their production numbers, then sales should match. However, if overall sales numbers were thousands over production, I would think that would trigger an audit. Unless somehow the left hand isn't speaking with the right.
Huntindog
Explorer
Jul 26, 2016
Perrysburg Dodgeboy wrote:
mich800 wrote:

Right, fraud never hurts anyone but shareholders...:h

From innocent employees that lose their jobs to worst case scenarios like Enron.

Not that this is the case here but shareholders are not the only ones to feel the impact of things like this.

The shareholders won't get hurt as dealer sales have nothing to do with them. Factory sales to dealers not the end consumer are what they care about.

Don

Wrong.

Investment managers use many sources of info to evaluate a stocks future potential. Youncan bet your socks that they are aware of Both sales to dealers, AND retail sales reports.
If those reports are untruthful, then they cannot make prudent investment decisions for their clients, IE: pension funds, mutual funds, etc.

So fake reports hurt a lot more people than just the shareholders.... And why should it be acceptable to lie to the shareholders anyways?
Perrysburg_Dodg
Explorer
Jul 26, 2016
mich800 wrote:

Right, fraud never hurts anyone but shareholders...:h

From innocent employees that lose their jobs to worst case scenarios like Enron.

Not that this is the case here but shareholders are not the only ones to feel the impact of things like this.

The shareholders won't get hurt as dealer sales have nothing to do with them. Factory sales to dealers not the end consumer are what they care about.

Don