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Chrysler Reports 1st Full-Year Profit Since 1997

“Modified” operating profit hits $2.0 billion; net at $183 million.

by on Feb.01, 2012

Chrysler/Fiat CEO Sergio Marchionne meets with reporters at the 2012 Detroit Auto Show.

For the first time since 1997, Chrysler has ended the year in the black with a net profit of $183 million and a “modified” operating profit of $2.0 billion, the automaker reported this morning.

After standing widespread predictions of its demise on their head, Chrysler now is  predicting another strong performance in 2012, including a double-digit gain in revenue and a 50% increase in operating income.

The figures come as a sharp turnaround for a company that declared bankruptcy less than three years ago and which survived only after receiving a more than $12 billion bailout from the U.S. Treasury.  But the Chrysler of today, now controlled by Italy’s Fiat, is a decidedly different manufacturer that went into Chapter 11 protection shortly after the collapse of a failed merger with Daimler AG of Germany.

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“The house is in good order. We are proud of the work we’ve done,” said Sergio Marchionne, who serves as Chief Executive Officer of both Chrysler Group LLC and Fiat SpA. “Now we greet a new year of high expectations with our heads down, forging ahead and focused on executing the goals we’ve set for ourselves as a company.”


Jeep Balancing Off-Road Chops and Fuel Stops

SUV brand helps set course for resurgent Chrysler.

by on Feb.15, 2011

Jeep aims to pull the rest of Chrysler uphill.

As pundits write endlessly about the resurgence of Chrysler, they talk mostly about the influx of new product at the company’s Dodge and Chrysler brands. But the troubled U.S. maker’s turnaround will also rely on its off-road brand, Jeep.

Despite being the first one of the Chrysler/Fiat’s five brands to launch a major new product as the company plotted its post-bankruptcy strategy, Jeep has been almost an afterthought. Just don’t tell that to Mike Manley, the president and CEO of the brand.

If you do, you’ll be reminded that Jeep Grand Cherokee — redesigned for 2011 and launched last summer — was the first Chrysler product to be launched as part of the new product offensive. And it was good enough to land on the finalist list for North American Truck of the Year.

Manley also will remind you that the compact Compass SUV was recently refreshed and is now trail-rated, and that other Jeep models have been significantly updated in one way or the other, mostly with updated interiors.

“We were the first brand to make news this year,” Manley said. “We’ve got some very good space now.”


U.S. Automakers’ Recovery “Ahead of Plans,” Says Obama’s Car Czar

Administration wants to sell off remaining auto stock “as soon as practicable, says Ron Bloom.

by on Jan.12, 2011

U.S. "Car Czar" Ron Bloom, second from left, at the Detroit Auto Show.

Investors aren’t the only ones pleased by the apparent improvements made by General Motors.  Less than two months after the carmaker’s record IPO was completed, U.S. “car czar” Ron Bloom could be found touring the GM exhibit at the Detroit Auto Show, where he declared the efforts to revive the maker – and cross-town rival Chrysler – “ahead of plans.”

What’s all the more surprising, said Bloom, the Obama Administration’s top manufacturing adviser, is that the two domestic makers are doing so well in a still-depressed economy, with the auto market itself only barely showing signs of a true turnaround.

“If there’s a positive surprise, I think it’s in the companies’ ability to execute their plans in this environment,” said Bloom.

That echoes comments made by GM CEO Dan Akerson, yesterday, during and after a speech to the Automotive News World Congress.  The former telecomm executive noted that prior to its bankruptcy-led reorganization, GM could barely make money even in the best years the U.S. auto industry ever experienced.  It is now positioned to make money in some of the worst markets ever – as it did in 2010.


Chrysler Taking Its Cues From Hyundai

U.S. makers hopes to emulate Korean carmaker’s turnaround.

by on Nov.15, 2010

Can Chrysler pull off the turnaround Hyundai has achieved? The maker hopes to begin in 2011.

For years, U.S. automakers – as well as many of their import rivals – have aimed to emulate the success of the industry’s global sales leader, Toyota.  But as Chrysler struggles to rebuild, in the wake of last year’s bankruptcy, it is targeting a very different manufacturer’s formula for success: Hyundai.

In recent years, the Korean carmaker has shown it possible to reverse a reputation for poor quality while transforming itself from a bargain basement retailer into one offering great value for the money.  It has been steadily gaining not just sales and market share, but increased consideration by those who, just a few years ago, wouldn’t have even dreamed of walking into a Hyundai showroom.

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“Frankly, our strategy is based on what Hyundai did,” Chrysler marketing manager Bruce Velisek told during a weekend preview of the new Dodge and Chrysler line-up.

With the launch of its 2011 models, the start of what Chrysler claims will be a complete revamping of its line-up under the guidance of Italian partner Fiat, the U.S. maker faces many of the same problems as Hyundai did.


Chrysler Could Turn Profit in ’10, Says Marchionne

But turnaround will take 18% sales gain here and abroad.

by on Jan.12, 2010

Chrysler could very well pull off an operating profit in 2010, says CEO Sergio Marchionne, but it will take an 18% jump in sales during a year with little new product.

Though it won’t begin its anticipated product renaissance for more than a year, Chrysler could still pull off an unanticipated profit for 2010, CEO Sergio Marchionne suggested during a Tuesday meeting with reporters at the North American International Auto Show.

After hitting “rock bottom,” Marchionne, who also serves as chief executive of Fiat, said he expects 2010 to mark the beginning of a long, slow recovery for both the U.S. auto industry and for Chrysler.

“We’re out,” he said, referring to the worst downturn the American car market has seen since the Great Depression.  “We just need to be focused and to be sure we don’t fall back on our bad habits.”

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Having become lean and focused – and after having dumped billions in debt and bad assets during the two-month journey through bankruptcy, last spring – Marchionne said Chrysler could very well pull off a real profit in 2010.  And it would be an operating profit, not an account trick where the company didn’t include such minor inconveniences as taxes.

“The magic number is 1.65 million,” said the Italian-born executive, who spent much of his life across the border, in Canada.


Chrysler to Build Engines for Fiat 500

Automaker planning $179 million Michigan investment.

by on Dec.18, 2009

Chrysler will produce the engine for the North American Fiat 500 at a plant near Detroit, requiring a $179 million investment.

Chrysler will produce the engine for the North American Fiat 500 at a plant near Detroit, a move that will cost it $179 million.

Engines built in Michigan will be exported to Mexico for use in the North American version of the Fiat 500, starting in late 2011, according to Chrysler’s top executive.

Chrysler plans to launch production of a 1.4-liter inline-four engine at the company’s Global Engine Manufacturing Alliance plant, in Dundee, Michigan, by the end of 2011, said Chrysler CEO Sergio Marchionne.

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“This is one more important step forward that demonstrates our intent to deliver on the promise of the Fiat-Chrysler strategic alliance and the substance of the road map we laid out in November,” Marchionne said.


Chrysler Predicts $14 Billion in Earnings by 2014.

CEO Marchionne insists he will eventually repay governments.

by on Nov.05, 2009

Just months after the automaker emerged from bankruptcy, Chrysler CEO Sergio Marchionne is predicting an operating profit in 2010.

Just months after the automaker emerged from bankruptcy, Chrysler CEO Sergio Marchionne is predicting an operating profit in 2010.

Less than five months after emerging from bankruptcy, Chrysler Group LLC has laid out an aggressive turnaround plan that will, if successful, more than double its North American sales, restore most of the market share it has lost in recent years, finally position it as a serious global player – and generate as much as $14 billion in profits over the next five years.

During an all-day session that explored the minutia of a far-reaching turnaround plan, Chrysler’s new CEO Sergio Marchionne promised no miracles but insisted that even using conservative estimates for the recovery of the U.S. market, Chrysler could be back in the black on an operating basis next year, and turn a net profit in 2011.

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In a message likely to be particularly well received by taxpayers worried about the $80 billion in money used to bailout Chrysler and General Motors, Marchionne said he expects to pay back the U.S. Treasury by the end of the 5-year bailout program.


Chrysler’s New Masters to Unveil Turnaround Plan

Inside Chrysler's 5-Year Plan

by on Nov.04, 2009

Chrysler's new CEO, Sergio Marchionne, has promised to streamline the automaker. He's already streamlined the logo, this new one just approved by the U.S. patent office.

CEO Sergio Marchionne has promised to streamline the automaker starting with this new logo, just approved by the U.S. patent office.

Bankrupt in 2009, back in the black a year later?  That’s one of the predictions Sergio Marchionne is expected to make, today, as he lays out his plan to turn around the ailing Chrysler.

Since the smallest of Detroit’s once “Big Three”  emerged from Chapter 11, in June, little has been seen or heard about its plans for the future, other than a couple tentative trial balloons.

In part, insiders say that reflects the mess that Chrysler’s new masters at Fiat discovered when they began digging into the company’s current situation.

But the Canadian-educated Fiat CEO Marchionne, who’s now taken the helm at Chrysler, believes that he can begin a lightning turnaround by slicing-and-dicing the U.S. maker’s product line-up – which will mean returning an Italian brand, Alfa-Romeo, to the U.S,, along with select products from Fiat – and implementing Fiat processes to not only speed up product development but also to cut costs and improve quality.

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At least 300 people are expected to attend today’s briefing at the Chrysler Technology Center, in Auburn Hills, Michigan.  The sprawling facility, with its attached corporate headquarters tower, is both a monument to Chrysler’s past days of glory, as well as a testament to its recent near fatal problems.