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Chrysler swings to profit in third quarter

Chrysler posts net income of $212 million in the third quarter, contrasted with a loss of $84 million a year earlier. Well-received new models and its alliance with Fiat are cited.

October 28, 2011|By Jerry Hirsch, Los Angeles Times

Chrysler Group said Thursday that it swung to a profit in the third quarter.

The company, which is gradually combining its operations with those of majority shareholder Fiat, the Italian automaker, said it had net income of $212 million in the third quarter, contrasted with a loss of $84 million in the same period a year earlier.

"Chrysler is outpacing the industry this year with sales up 26.1% third quarter to third quarter and 23.1% for the year," said Michelle Krebs, an analyst with auto information company "In addition to higher vehicle sales volume — thanks largely to Jeep — Chrysler has lowered incentives, and that's helped to boost the average transaction price. That's the not-so-secret formula for accomplishing profits and a turnaround."

The company has been helped by the introduction of well-received new models, including the Jeep Grand Cherokee, Dodge Durango and Chrysler 200, and its alliance with Fiat.

Third-quarter revenue rose 19% to $13.1 billion.

"In the third quarter, Chrysler Group achieved increased sales and positive financial results, totally in line with the plan we laid out in November 2009," said Sergio Marchionne, Chrysler's chairman and chief executive. "This house continues to be fully focused on financial performance and making outstanding cars and trucks by fully leveraging its alliance with Fiat."

On Wednesday, the United Auto Workers said its members had ratified a new labor agreement with Chrysler.

The Chrysler "agreement adds 2,100 new UAW jobs which, together with jobs added at GM and Ford, mean more than 20,000 direct manufacturing jobs will be added to our economy," UAW President Bob King said.

The UAW represents 26,000 Chrysler workers, including 3,000 salaried employees, at 48 facilities in the United States making vehicles and components with the Chrysler, Jeep, Dodge, Mopar and Ram brands.

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