During last week's Fiat Investor Presentation at Lingotto CEO Sergio Marchionne reiterated that the Iveco truck division was not for sale and that the Group has ambitious plans for its long term growth and a wider reach, including a possible US launch. "It is not for sale," Marchionne firmly told investors.

With the impending merger between MAN and Scania currently dominating the sector's news headlines and expected to be the first of a fresh wave of consolidation across the European truck sector, there has been much recent talk that Fiat could sell its Iveco trucks-to-buses division, or merge it with another big player. The MAN-Scania merger, effectively an unwanted takeover of Scania by MAN, is being pushed forward by VW, a major strategic shareholder in both companies, despite much internal resistance from Scania.

Marchionne was quite critical of this proposed merger during the conference call, commenting to investors that he did not see the logic of the interest MAN is pursuing in Scania as both in particular are very strongly positioned in the heavy truck sector. "I don't see the immediate benefit of aggregation in Scania, the MAN and Scania relationship adds nothing," he told investors in Lingotto. "It does not complement the portfolio, and it does not add to the geography." He added that he didn't see any new MAN-Scania merged entity as being a threat to Iveco, more he believes that Iveco is much better placed to push its product portfolio upwards than MAN-Scania would be to push themselves downwards.

Marchionne then went on to throw up a complete surprise by saying that Iveco would actively look to enter the fiercely competitive United States and Canadian markets in the near future: "The only geographical layout that is currently uncovered is the North American market," he said.
 

"It is a market that we continue to look at in terms of potential access; how and when that intervention will take place has yet to be defined," he added. The US market is saturated and highly-competitive with all the major players wel established and marketing products that are honed to the region's unique needs. Marchionne however admitted that for Iveco to enter this market would need to be considered very carefully. "We are open to looking at all ends of the market," he noted. "We will have to be very careful."

The CEO of Iveco, Paolo Monferino, said that the company was aiming to make operating profits of 10 percent by 2010 and raise its Western European market share from 11 to 12.5 percent; its Eastern European slice from 12.7 to 17.7 percent; and its African and Middle Eastern cut from 5.7 to 10 percent. "We are committed to making Iveco a double-digit profit company," he told the conference call. Iveco expect an operating profit of 7.1 to 7.9 percent in 2007.

Iveco will build on the success of its current products in Europe, including the new light Daily van range which has gained 45,000 orders already, and the Eurocargo which holds a co-market leading 25 percent of the European market in its segment. "Iveco has a number of leverages for steady profit improvement," he added. For the first three quarters of 2006 Iveco has turned in a trading profit of 389 million euros, as opposed to the 217 million euros it posted during the same period last year.