Chrysler now a rising star among automakers
BY DEE-ANN DURBIN & TOM KRISHER Associated Press
Thursday, January 31, 2013
1/31/13 at 4:54 AM
DETROIT - In just three years, Chrysler has gone from government ward to rising star.
The No. 3 U.S. automaker made $1.7 billion last year thanks to big gains for its much-improved cars and trucks, and is expecting profits to reach $2.2 billion this year.
It's a big improvement over 2011, when Chrysler earned $138 million. And it's even more remarkable considering that Chrysler was in bankruptcy and living on taxpayer loans just three years ago.
The improving U.S. economy is one reason for Chrysler's success. Auto sales in the U.S. - where Chrysler sells three out of every four of its vehicles - rose to a five-year high of 14.5 million last year. They could climb to 15.5 million or more this year, most industry analysts say.
But Chrysler rose even faster than average, with its U.S. sales up 21 percent versus 13 percent for the industry. That's because new or recently revamped products like the Dodge Dart small car, Ram pickup and Jeep Grand Cherokee are putting Chrysler back on buyers' shopping lists after years of quality concerns and flagging demand. Sales of the Chrysler 300 sedan nearly doubled in 2012; so did sales of the tiny Fiat 500.
Chrysler also made more on every car it sold. Customers paid an average of $29,630 for a Chrysler vehicle last year, up about $1,000 from the year before, according to auto pricing site TrueCar.com.
Revenue increased 20 percent to $65.8 billion last year. Chrysler expects higher revenue of between $72 billion and $75 billion this year.
Fueling the growth is a revived truck market that should see some upswing as home construction improves. The company's Ram pickup is a strong contender in that segment, says IHS automotive analyst Mike Wall.
It helps that Chrysler has limited exposure to Europe, where falling sales have hurt its competitors, Wall says. Ford announced Tuesday that it expects to lose $2 billion in Europe this year on top of a $1.75 billion loss in that region in 2012.
Chrysler also gave an update on some future products. It confirmed that an Alfa Romeo car will come to the U.S. from Italy later this year, possibly with a Ferrari-designed engine. A new version of the Chrysler 200 midsize sedan is coming in 2014, and a long-awaited new minivan is due in 2015.
Original Print Headline: Revamped Chrysler a rising star
The front grill of a new Chrysler car sits at a dealership in Springfield, Ill. Chrysler says its profit jumped to $1.7 billion in 2012 as sales rose 18 percent. Chrysler's profit was nine times higher than the $183 million recorded in 2011. SETH PERLMAN / Associated Press file