Fiat Chrysler Revises Sales Reporting Methods After Accusations of Fraud

From Road & Track

Earlier this month, it was reported that the Department of Justice and the SEC opened investigations into Fiat Chrysler's (FCA) sales reporting practices, following accusations that the company paid dealers to inflate the number of cars sold. FCA for its part dismissed these claims as being "without merit," but Tuesday, it announced that it would revise its sales reporting process.

Under this new methodology, reports Automotive News, Fiat Chrysler sold 18,996 more cars since 2011 than originally reported, but also that its 75-month streak of year-over-year sales increases actually ended in September 2013 at 41 months. News of this revision follows an earlier Automotive News report which said that the company knowingly inflated sales, a practice it reportedly tried to stop last year.

Based on a January lawsuit filed by FCA dealers and Automotive News' investigations, many believe that FCA was paying dealers to list unsold cars as being sold on the final day of the month, and then "unwind" those sales for the following month. In a statement given to the press Tuesday, FCA said that these news reports "have mistakenly suggested that potential inaccuracies in the monthly data somehow impact the integrity of FCA's reported revenues in its financial statements."

While the new reporting method forced FCA to retroactively shorten its sales streak, the company says that annual sales between 2011-2016 were "within approximately 0.7% of the annual unit sales volumes previously reported."

While FCA continues to rebuke accusations of fraud, the timing of this announcement is sure to raise some auto industry eyebrows. For an exact breakdown on this new reporting methodology, visit Fiat Chrysler's site.