Today, Chrysler reported its first yearly profit since 1997. It was $183 million net profit on $55 billion net revenue. Not earth shattering as car companies go, but a start: Chrysler wants to turn this into $1.5 billion of net profit in 2012 and $65 billion of revenue. At the same time, Fiat-Chrysler cut its 2012 revenue target to 75 billion, due to a slowing demand for cars in a weakening European economy. Fiat will not pay a dividend for ordinary shares in 2011.
According to Reuters, “Chrysler’s strength offset Fiat Group Automobiles (the grouping of Fiat, Lancia and Alfa Romeo brands) weakness.”
Says Michelle Krebs of Edmunds:
“Chrysler is the surprising comeback kid — again. When Chrysler emerged from bankruptcy, there were plenty of skeptics, but the automaker has proven them wrong. Since detailing its plan for the future in November 2009, Chrysler has done everything it said it would, creating an impressive recent track record and providing confidence that it will meet its 2012 goals.”
Krebs explains the math behind Chrysler’s good numbers:
“Chrysler’s incentives spend was among the lowest in the fourth quarter of any time in the past two years, and its average transaction price was the highest in at least two years (maybe ever) at $30,603. All of this as vehicle sales soared 35 percent from the 2010 fourth quarter.“