Offering up another sign of its ongoing recovery, Chrysler reported 2012 earnings jump nearly nine-fold, to $1.66 billion, while the maker’s fourth-quarter profit was up 68%, to $378 million.
The news reflects a sharp increase in sales and revenues – Chrysler being the only one of Detroit’s Big Three automakers to gain market share in 2012.
“We pause for a moment to enjoy our accomplishments, but we will not stop,” Sergio Marchionne, CEO of both Chrysler and its Italian alliance partner Fiat, said in a statement.
Marchionne pointed to soaring demand for key products such as the Jeep Grand Cherokee and the new 2013 Ram 1500, the pickup getting another boost earlier this month when it was named North American Truck of the Year by a jury of 49 U.S. and Canadian journalists.
But Chrysler is not entirely without its problems, analysts caution, pointing to the maker’s continuing heavy reliance on the North American market. Though the first U.S. automaker to set up shop in China it is currently an also-ran there, and its efforts to penetrate Europe have been set back by the Continent’s worsening economic issues.
Further complicating matters are the problems partner Fiat faces in Europe, where automotive sales plunged to their lowest level since 1995 last year. Fiat’s challenges in its home market have delayed its plans to continue expanding its stake in its U.S. ally, a partnership that was established as part of Chrysler’s bankruptcy and federal bailout in 2009.
If anything, the latest financial statement suggests that Chrysler is now doing the heavy lifting. Its 2012 earnings compared with a modest $183 million the year before. However, the 2011 numbers reflected a $551 million payoff of Chrysler’s remaining bailout debt owed the U.S. and Canadian governments.
And the fourth quarter profit compared with $225 million during the final three months of 2011.
Meanwhile, revenues for all of 2012 increased 19% to $65.7 billion, while they surged 13% to $17.1 billion during the latest quarter.
“Chrysler concluded a very successful 2012 with a robust fourth quarter performance,” said Jesse Toprak, senior analyst with the auto data tracking service TrueCar.com. “The company was the only domestic automaker to gain market share last year.”
With industry analysts and insiders predicting the U.S. market will jump from 14.5 million to somewhere between 15.0 million and 15.5 million in 2013, Marchionne is forecasting another good year for Chrysler. He is projecting earnings will reach $2.2 billion on revenues of at least $72 billion. The maker expects its unit sales to climb from 2.4 million last year to somewhere between 2.6 million and 2.7 million.