Chrysler reported a net loss of $197 million in the first quarter

Article by Christian Andrei, on August 29, 2010

After reducing costs and launching a big pickup, Chrysler Group posted a $143 million operating profit in the first quarter of the year. In a statement, Chrysler revealed that revenue increased to $9.69 billion in the first quarter of 2010, a 2.7% increase from same period in 2009.

Chrysler also posted a net loss of $197 million in the first quarter of 2010, compared with a net loss of $2.69 billion for the same period in 2009.

After it emerged from bankruptcy on June 10 up until the end of 2009, Chrysler had lost $3.8 billion on revenue of $17.7 billion.

Fiat S.p.A. had gotten a 20% stake in Chrysler after its Chapter 11 reorganization with $15 billion in government support. In a statement, Sergio Marchionne, CEO of Chrysler, said that the first quarter's positive operating result is a "concrete indication" that its 2010 targets are achievable.

He also said that Chrysler is producing cash to fund the investments in its product portfolio and brand repositioning. Fiat, which had lost 25 million euros, reported a drop from 410 million euros a year before. These results were announced ahead of Fiat's presentation of its 5-year plan.

Chrysler said its cash rose to $7.37 billion on March 31, from $5.88 billion at the end of last year. It can still draw on $2.4 billion in funding from US and Canadian taxpayers, giving the automaker a total available liquidity of $9.8 billion.

The company reported total financial liabilities of $13 billion. In the first quarter of 2010, Chrysler's worldwide vehicle sales increased to 334,000 cars and trucks. In the fourth quarter of 2009, it posted sales of 318,000 units.

Chrysler asserted that the introduction of the Dodge Ram Heavy Duty pickup as well as its "continued price discipline" boosted revenue. Autodata Corp. said that as Marchionne cut the discounts it provided to consumers, its US sales dropped by 5.3% in the first quarter. Meanwhile, industry deliveries had gone up by 16%.

Topics: chrysler, profit

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