Chrysler books $436 million profit in the second quarter

(Updated 14: 45 East) DETROIT--Chrysler Group LLC further earn turnaround from near death three years ago $436 million in the second quarter and confirmed that it is a full-year operating profit of at least 3 billion $ show.

Chief Executive Sergio Marchionne, warned employees in an e-Mail to Chrysler on Monday against overconfidence in the light of the recent success of the company after "Life through a near-death experience" in 2009.

"History teaches, that it simply in good times to develop bad habits," Marchionne enrolled in the e-Mail from that copy was acquired by Reuters. "This has become no time around corners, no time to our version of undisciplined, no time to forget how difficult it was, our way to claw back to viability."

A year ago, in connection with Chrysler, $370 million in the second quarter, including losses relating to $551 million payments of the Government lost credits of its 2009 bankruptcy and rescue.

In the second quarter, revenues rose by 23 percent to $16,7950 billion.

"Our results reflect to deliver the best quality and value for our brands, a tireless pursuit of the people of the Chrysler Group," said Marchionne, the CEO of Fiat, in a press statement.

Chrysler is majority owned by Italian Fiat SpA.

Fiat, the result of reports in the second quarter on Tuesday. In the past several quarters, its have through weak earnings have been increased the strength of Chrysler. Marchionne will develop during a conference call Tuesday with reporters and investors on the result of Chrysler.

Fiat result have through the economic crisis in Europe under pressure has been used. It is based also on southern European markets where sales are the hardest hit.

US sales by 24% worldwide vehicle sales rose 20 percent to 582.000 in the second quarter, led by a rise in. Sales outside the core market in North America rose to 70,000 vehicles 58 percent in the quarter.

Earlier this month, Fiat to exercise its call option, another 3.3 percentage points of Chrysler, announced increase its stake to 61.8 percent done to buy. Fiat neither Chrysler have even pointed out that the deal were sealed.

The remaining shares in Chrysler are a retiree healthcare trust of the United Auto Workers Union manages.

Earlier this month, said Marchionne of operating profit for year as a whole, "the goal of $3 billion in your area." "We could overshoot."

Sales have steadily for Chrysler since the first quarter of 2010, rose when it started breaking out their business results by Fiat. At the time, Chrysler was $9,6900 billion revenue.

Until June Chrysler has reported 27 consecutive months growth in the United States year after year. This strip followed approximately 24 consecutive months of U.S. sales.

Marchionne and his management team will be with the overhaul of Chrysler vehicle lineup that outdated and panned in quality 2009 took over surveys and reviews as Fiat management control has been credited.

Chrysler is now up sales for its new small Dodge Dart sedan ramps, which in the compact class segment of the US car market-a crowded segment competes, the the Honda Motor Co civic, Toyota Motor Corp corolla, the Ford Motor Co. focus and General Motors co. Chevrolet Cruze contains.

The DART is the first vehicle from Fiat and Chrysler will be developed together.

Fiat management control and a 20 percent stake in Chrysler in the context of the insolvency plans restructuring that the Auburn Hills, Michigan, automakers in 2009, the extinction of saved.

Chrysler bar at the end of the second quarter rose to $12,0750 billion from $10,1750 billion a year ago and $11,30 billion at the end of the first quarter. Total available liquidity at the end of the second quarter was $13,40 billion.

Free cash flow was $866 million at the end of the second quarter, down from $1.70 billion at the end of the first quarter, and up from $174 million a year ago.

Copyright 2011 Thomson Reuters.

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Auto sales record best quarter since 2008

David Zalubowski / AP

A line of 2012 Focus sedans at a Ford dealership in the south Denver suburb of Littleton, Colo.

By msnbc.com staff and wire reports

Updated at 2:04 p.m. ET: The auto industry looks set to ride the appeal of smaller cars to its best quarterly performance in almost four years.

Auto sales rose sharply in March, boosted by consumers with more confidence in a recovering U.S. economy who want to buy fuel-efficient cars and trucks in the face of rising gasoline prices.

Strong sales in March are the most convincing evidence yet this year of a sustained recovery in the U.S. auto sector. Analysts said unseasonably warm weather last month drew out American car shoppers. The rise in gas prices to near $4 a gallon coupled with high used car prices also prompted some consumers to buy new vehicles earlier than planned.

Ford's U.S. sales rose 5 percent from a year earlier. Ford, No. 2 in the U.S. market, reported its best March for new auto sales in five years on strong sales of small cars such as its Focus sedan and its F-Series pickup trucks.

Chrysler, No. 4 in U.S. sales, reported a 34 percent increase, led by its Chrysler brand, which had a sales increase of 70 percent.

It was the 24th consecutive month that Chrysler showed a year-on-year sales gain.

Don Johnson, GM VP of U.S. sales operations, offers insight on GM's March automobile sales, with CNBC's Phil LeBeau.

General Motors, the No. 1 automaker in U.S. and global sales, said its U.S. sales rose 12 percent in March on solid demand for cars and small crossovers that achieve 30 miles per gallon or better on the highway.

Nissan said its sales in March rose 12.5 percent, and Volkswagen said its March sales soared 35 percent -- its best U.S. March sales since 1973.

Toyota, No. 3 in U.S. sales, saw a 15 percent rise in March sales.

South Korea's Hyundai, which has the best fleet-wide fuel economy ratings in the market, said it expected to have record monthly sales.

"The current level of gas prices will further accelerate the release of pent-up demand as consumers lean towards significantly more fuel-efficient new vehicles while used prices are still strong," Morgan Stanley analyst Adam Jonas said.

Consumer confidence rose in March to its highest level since February 2011, the Thomson Reuters/University of Michigan reading of consumer sentiment showed.

Consumers who held off purchases during the economic downturn -- which led to the worst U.S. auto sales since World War II adjusted for population -- are returning to the market, said Edmunds.com analyst Jessica Caldwell.

In February, auto sales rose to their highest level in four years.

"Vehicle trade-in rates have achieved sustained highs in recent months, which suggests that consumers have decided that they've held on to their cars for too long," Caldwell said. "And with the average credit score for new car buyers at its lowest level since the first half of 2008, the market is clearly becoming a friendlier place for all buyers."

Toyota released its March sales numbers at an increase of 15.4 percent, below the estimated 21 percent increase. CNBC's Phil LeBeau and Jim Lentz, Toyota's U.S. president/CEO, discuss Toyota increasing U.S. RAV4 production and March sales.

As sales rise, automakers are also getting more profit per vehicle. Incentives continued to trend downward in March while the average transaction prices per new vehicle rose, autos consultant TrueCar.com said on Tuesday.

Auto analysts surveyed by Thomson Reuters expect an annualized sales rate for March of 14.74 million vehicles, which would be a rise from last March's 13.1 million sales rate. Analysts say pent-up demand, easier credit, more fuel-efficient product offerings and mild weather helped boost March sales.

Mike Jackson, chief executive of the nation's largest auto retailer, AutoNation Inc., told CNBC on Monday that the company raised its 2012 sales forecast to about 14.5 million from 14 million, based on the strongest quarter for auto sales since before the sales downturn that began in late 2008.

Incentive spending in March fell about 2 percent industry-wide, rising only for Chrysler, Nissan and Volkswagen, TrueCar.com said. Major automakers are expected to show gains on year-ago sales, led by Chrysler Group LLC, GM and Toyota Motor Corp.

"Automakers have hit the sweet spot this month with lowered incentives and double-digit sales increases, which signifies underlying strength in consumer demand," said analyst Kristen Andersson of TrueCar.com.

Truck sales continue to improve, but the improvements in car sales are relatively stronger, reflecting increased appetite for smaller, more fuel-efficient models, analysts said.

Is this a sign that the recovery is here to stay? Share your thoughts on Facebook.

Reuters and The Associated Press contributed to this report.

CNBC's Phil LeBeau reports March auto sales saying, "while they are strong, they are not as strong as many were hoping, in part because they're being driven by strong fleet/rental orders."

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Chrysler posts $212M profit in third quarter

DETROIT — Chrysler is selling more cars and trucks for higher prices, pushing the company back into the black in the latest quarter. It's another sign that the once-troubled automaker is turning around under its new Italian management.

Auburn Hills, Michigan-based Chrysler reported Thursday that its net income was $212 million for the July-September period, its second quarterly profit this year and only the second since 2006. Vehicle sales worldwide rose 24 percent, and revenue was up 19 percent to $13.1 billion.

In last year's third quarter, the privately held company lost $84 million, but Chrysler, now run by Italy's Fiat SpA, said its fortunes have improved because of increased demand for its new or revamped Chrysler, Dodge, Jeep and Ram cars and trucks.

Yet even with the profit, Chrysler Group LLC hasn't fully recovered from its 2009 brush with death. The company, neglected by two previous owners, nearly ran out of cash and needed a government bailout to survive bankruptcy restructuring.

"They are still in the most precarious position out of the Detroit Three, but they're making progress in a market that's really not doing that well in the first place," said Aaron Bragman, an industry analyst with industry consulting firm IHS Automotive.

Auto sales in the U.S., Chrysler's primary market, have sputtered all year at an annual rate of around 12.5 million vehicles as debt-weary Americans hold onto their vehicles longer. The sales rate is enough for Chrysler, General Motors Co. and Ford Motor Co., to make money, but it's far short of the 2005 peak of 17 million.

Chrysler hasn't made an annual profit since 2005, but it's getting closer to profitability with a mix of strong new products.

Jeep was the top brand from a U.S. automaker in Consumer Reports' latest reliability rankings, which were released Tuesday. Chrysler was also the most improved brand, moving to 15th place from 27th. The Jeep Grand Cherokee SUV, Chrysler 200 midsize car and Dodge Durango SUV have been among the company's recent successes.

Chrysler, Bragman said, has raised the quality of its vehicles by revamping them in a short amount of time under Fiat's leadership. The company, he said, has changed manufacturing methods and now puts cars and trucks through rigorous tests.

"They've inserted whole layers of testing that never were there before," he said. "They've improved the feedback when problems do go wrong. The response time is now measured in hours rather than years."

But even with the improvements, Bragman said Chrysler still has a way to go to change its longtime image of poor reliability. "It's going to take a couple of years of consistency," he said.

Chrysler's third-quarter profit wasn't quite big enough to erase a loss from the first half of the year. The company ended the first nine months $42 million in the red, mainly due to a $551 million accounting charge for refinancing its government debt in the second quarter. Excluding the debt charge, the company earned $509 million during the first nine months.

Chrysler increased its earnings forecast for the full year to a profit of $600 million, excluding the accounting charge. Previously it had forecast $200 million to $500 million. It also predicted 2011 revenue of $55 billion.

The company is getting healthy prices for its cars, and that's helping it make money. Chrysler's average U.S. sale price rose 4.5 percent in the third quarter to $30,387, according to the Edmunds.com automotive website. Also, Chrysler's share of the U.S. market increased almost 2 percentage points to 11.6 percent last quarter.

Chrysler also got good news on the labor front this week. On Wednesday, the United Auto Workers announced that 55 percent of the Chrysler workers voting on a new contract approved the deal. The four-year pact, which covers 23,000 U.S. factory workers, will hold down the company's costs by giving workers profit-sharing and other bonuses instead of annual raises.

During the quarter, Chrysler also helped its bottom line by cutting borrowing costs through refinancing of $7.5 billion in high-interest loans from the U.S. and Canadian governments. The company said it paid $282 million in interest last quarter, down $34 million from a year earlier.

Fiat controls Chrysler with a 53.3 percent stake in the company. Under a 2009 deal with the U.S. government, Fiat got a 20 percent stake after Chrysler exited bankruptcy protection. Fiat gradually raised its stake and gained a majority share in July, when it paid the U.S. Treasury for its remaining shares.

Fiat expects to raise its ownership of Chrysler to 58.3 percent by the end of the year, when it introduces a 40 mpg car for the U.S. market. The high mileage car was also part of its deal with the government. A union trust fund that pays retiree health care costs owns the rest of the shares.

Chrysler's earnings also helped its Italian owners. Fiat released third-quarter earnings on Thursday, posting a 67 percent profit increase to euro112 million ($157 million) thanks to demand for Chrysler cars and trucks in North America.

Chrysler may return to the public stock exchanges sometime next year, with the trust fund raising cash by selling at least part of its stake.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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