Fiat Turns Higher Profit as Spending Cuts Narrow European Losses
The Fiat Group reported its profits for the second quarter of 2013 and they were better than expected, attributed to strong pickup truck sales at Chrysler’s Ram brand and spending cuts in Europe.
Earnings before interest, taxes and one time items increased by 9% to 1.03 billion euros ($1.37 billion). Revenue was up 4% to 22.3 billion euros. Losses in Europe were down 40 million euros to 98 million. The company says that it expects to be in the black in Europe by 2016. The European losses were more than offset by U.S. sales and profits.
Net income for Fiat went up to 142 million euros, an improvement of 110 million from 2012. Without Chrysler, that net income would have been a loss of 247 million euros for Q2 2013.
Fiat’s car sales were down 10% in the first half, performing poorer than the industry average of -7%.
Fiat’s own projections say it is on pace to have a 2013 trading profit of between 4 and 4.5 billion euros, up from 3.81 billion last year. That projection exceeds those of industry analysts, who say that the company will report 3.83 billion euros profit for the entire year.
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