Chrysler has posted its first quarterly profit since go... Chrysler has posted its first quarterly profit since going through bankruptcy (Chrysler).
Two years after it was escorted through bankruptcy reorganization by the White House and with the help of loans from U.S. and Canadian taxpayers, Chrysler has posted its first quarterly profit.

The Auburn Hills, MI automaker -- maker of Jeep, Dodge and Chrysler vehicles -- earned $116 million in the quarter, an improvement after losing $197 million in the same period last year. Revenue was up substantially by 35% to $13.1 billion, while sales of vehicles were up 18%.

Cash on hand is a key measure of an automaker's health because of the substantial capital needs of industrial companies. Chrysler said it had $9.9 billion in cash on hand as of March 31, an increase of $2.6 billion in three months, and $13.3 billion in debt.

Chrysler CEO Sergio Marchionne, who also serves as CEO of Italian automaker Fiat, which is allied with Chrysler, has announced the company will shortly refinance its $7.5 billion in outstanding loans with the U.S. and Canadian government with bank debt, paying back taxpayers who bailed out the company years ahead of schedule. Chrysler said it would repay the loans by the end of June by selling $2.5 billion in bonds and borrowing $5 billion at better terms than those dictated with the government loans.

"Chrysler Group's improved sales and financial performance in the first quarter show that our rejuvenated product lineup is gaining momentum in the marketplace and resonating with customers," Marchionne said in a statement. "These results are a testament to the hard work and dedication of our employees, suppliers and dealers, all of whom are helping Chrysler create a new corporate culture built on the quality of our products and processes, and simple, sound management principles."

Chrysler has been crawling back to profitability, but was kept in the red last year by the interest payments on the loans that were critical to its survival in 2009. The company had reported operating profits in each quarter of 2010, but those interest payments, which totaled $1.23 billion for the year, resulted in losses over all. Chrysler lost $652 million last year.
Will Chrysler continue to turn a profit throughout 2011?
Yes 7626 (82.5%)
No 1613 (17.5%)


Looking ahead, the company, which is expected to do an initial public offering of stock by mid 2012, said it expects to earn $200 to $500 million for all of this year, meaning it could post additional money-losing quarters this year as well as profitable ones.

G.M., which went through government-led bankruptcy at the same time as Chrysler, earned $4.7 billion in 2010, and will report first quarter earnings later this week. Chrysler, though, was in worse shape than GM, and its new-product pipeline was impacted more adversely by the ownership of private equity firm Cerberus, and then the bankruptcy.

The company's passenger cars, though much improved under Fiat, are still under-performing its rivals, while pickup trucks and SUVs still account for most of Chrysler's sales--78 percent in the first quarter, compared with about 60 percent for GM and Ford. The all-new Jeep Grand Cherokee has been especially well received.

Chrysler is gearing up for a significant 2012 and 2013, a period in which it planned to introduce several new vehicles developed from scratch by Chrysler and Fiat design and engineering staffs working together. Those new vehicles are being built from Fiat engineering platforms that are being adapted for Chrysler vehicles. The automaker in the last few months has been rolling out numerous updated and improved cars and SUVs, but those have been mostly improved carry-over vehicles from when Chrysler was owned by Cerberus Capital Management and German automaker Daimler before that.

Cerberus was stripped of ownership of Chrysler in 2009 when the company hit the financial wall, and needed government help. To protect jobs in the already hard-hit Midwest, the White House Auto Industry Task Force directed funds from the Troubled Asset Relief Program (TARP) funds. Fiat was the only automaker that stepped up with interest in running Chrysler.

The auto industry bailout kept Chrysler, as well as General Motors, from going out of business or being broken up, as well as hundreds of auto suppliers and thousands of auto dealers that would have gone out of business as a result.

By the end of the year, Fiat expects to exercise an option that will give it 51% of Chrysler. Until the government loans are formally paid back, the U.S and Canada own a combined 10.8 percent of Chrysler. Chrysler is now 30-percent owned by Fiat. Fiat will increase that by 16% after the loans are repaid. Chrysler's majority owner is currently a trust fund set up to cover the cost of health care for hourly retirees.


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  • 341 Comments
      Cris
      • 4 Years Ago
      GOOD NOW PAY THE TAX PAYERS BACK WITH INTEREST AND STOP THESE HUGE BONUSES. LETS ALL FLOOD THE WHITE HOUSE. IT'S OUR MONEY AND WE WANT IT BACK ASAP, NOW NOT YESTERDAY.
      David
      • 4 Years Ago
      I hate to say it but it will have to be many years of proving themselves before I would even consider buying another Chrysler Product. The 2008 Jeep Wrangler i had was a joke at best...a real American Icon..NOT. I couldn't get rid of it fast enough. At 50 years old and having an interest in cars, I've had them all...American, Japanese, European. I've had 2 bad ones in my whole life, one Dodge and that crumby Jeep. I wish them luck but "No thanks"
        Cris
        • 4 Years Ago
        @David
        bAILOUT, AND IT IS OUR MONEY AND WE WANT IT BACK, NOW.
      • 4 Years Ago
      I am happy that Chrysler is going to make it. I am glad Obama bailed out the venture capital firm that bought them with extremely favorable terms but let Lehman Brothers fail. I guess if Chrysler was competing against Goldman Sachs they would not have been helped. The impact of Chrysler going away would not have had more impact than that of Lehman which was high but we absorbed it. Good to see in any case that more and more TARP funds are being repaid.
      Steven Ruza
      • 4 Years Ago
      steven ruza good
      Thomas
      • 4 Years Ago
      If Chrysler made a quality product, people would buy. The last american made car I owned was a Chrysler product, a Doge and it was a piece of crap. No resale value, poor workmanship.
      Mr.D99
      • 4 Years Ago
      Too bad the tax payers are going into bankrucy now. The government blew it with all this stuff. Banks and healthcare are the biggest problem in this country. They suck the hard working Americans to death financial wise and the government just pays their billis on the back of the tax payers. Where is my check? If I bailed them out where is my cut of the profits? It' all smoke and mirrors the tax payer gets screwed no matter what.
        tomozzy123
        • 4 Years Ago
        @Mr.D99
        You get to keep your job or government benefits. That's your cut.
      Tracie
      • 4 Years Ago
      UM, YEAH!!!! They have the BEST performing and best LOOKING cars/trucks/minivans EVER!!!!!!! I will be 50 in a couple of weeks, I'm a woman. Since I married my husband, 30 years ago. All we've owned are Dodge vehicles...with the exception of our son's 92 Camaro, and our daughter's Oldsmobile(which is dead in the yard), an 88 model. My husband's Dodge pickup? A 1990...still going strong...
      thelonelyone1851
      • 4 Years Ago
      Iacocca,Marchionne.....how could you not love those guys? GM only can dream of having wise,long standing leadership,unlike the guys they have run thru in the past few months...
      wiccadways
      • 4 Years Ago
      Buy a Chrysler at your own risk. I know opinions are like ***holes- everybody has one. Well, here's mine, so just look away if you can't face it. I have been a Mopar fan since the 60's, and have had cars like a 340 Dart GTS and a Challenger RT. My first car was a '60 Plymouth, then a '64 Dart; both had a 225 six and automatic. Bulletproof, both of them (and I understand about the progress of automotive technology. I'm not saying these old tanks were better than today's cars, so hear me out). Today, Chrysler is doing what it always has, good design, aggressive advertising, and weak build quality to back it up. My proof? It would take too long to list all the problems my '89 Chrysler convertible had. EVERY component (engine, trans, turbo, a/c, cooling system) needed repair or replacement. The only reason it didn't qualify under lemon law is because they were all different problems. We bought a Toyota truck and it has been a ROCK for over 210k miles. Then I wanted a 4-door, and kinda liked the PT cruiser. I did research on line, at dealerships, then bought one. I can only say it hasn't been as bad as the convertible. I have written to the Company multiple times regarding the convertible, to no effect. Never again, even if Emenem thinks Detroit is cool (maybe if they pay me what they paid him...). Thank you for your patience in reading this, so to close I'll just give you the experts judgement; per the most recent JD Power 3yr reliability survey... "Sitting at the bottom of the list are Chrysler with 202 problems per 100 vehicles, Dodge with 206, Land Rover with 212, Jeep with 214 and MINI with 221."
      stripedbass7
      • 4 Years Ago
      LMAO ! Their Made in mexico. Wikipedia or Google the Fcatory locations. The Plants in the USA are Closed. They All Come from Mexico, including the caddillack division. Before you buy 1 open the hood, or look in the door jamb, made in Mexico.
      • 4 Years Ago
      BUY AMERICAN AND BE AMERICAN! I HAVE BEEN DRIVING JEEP-CHRYSLER'S FOR THE LAST 15 YEARS. THEY WEAR LIKE IORN AND I HAVE NOT HAD ANY PROBLEMS THAT COULD NOT BE FIXED EASILY IN A DAY. ALL VECHILES NEED REPAIR- AUGIE AT WHITE PLAINS CHRYSLER IS THE BEST OWNER. NEED A CAR SEE AUGIE! IF YOU HAVE A PROBLEM HE WILL TAKE CARE OF IT PROPERLY.
      • 4 Years Ago
      And some clowns would have preferred to have the American auto industry wiped out, so they could get rid of more jobs, not only the UAW, but myriad parts manufacturers, or the idiot representatives that wanted to see them go belly up because they are paid by the foreign manufacturers who builf factories in their states. All the politicians are for sale. What a country we have become.
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