Chrysler Group’s cars and light trucks sold so well that it was able to report a net profit of $436 million for the second quarter. For the same period last year, Chrysler reported $370 million in losses since it had paid off a $551 million charge for its U.S. government loans. For the latest period, its revenue increased by 23% to $16.80 billion as Chrysler's global auto sales increased by 20% to 582,000.
In a statement, Chrysler-Fiat CEO Sergio Marchionne said that the results show off the “tireless pursuit” of Chrysler to offer the highest quality and value throughout its brands. When Chrysler posted a net income of $473 million in the first quarter, it said that it was on course to hit its $1.5 billion profit goal this year.
Last year, Chrysler reported earnings of $183 million, its first annual net profit since it emerged from bankruptcy in 2009. In the second quarter, Chrysler said that it was able to achieve modified operating profits of $755 million, or 4.5% of revenue, in the second quarter. This is 49% higher than the same period the previous year. Chrysler attributed this increase in modified operating profits to strong sales volume and pricing.
These improvements were offset partially by a bad combination of events as the automaker boosted its deliveries of cars compared to trucks and SUVs. It also improved its vehicle content and increased r&d outlays.
Chrysler said that at the end of the second quarter, it had $12.1 billion in cash, higher than the $11.3 billion reported at the end of the first quarter. Chrysler doesn’t have a captive arm to increase revenues and so its profits would depend more on sales, unlike the rival companies. However, the demand for Chrysler’s models has stayed strong in the U.S. as well as in other countries.