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April 21, 2010

US: Chrysler aims for 2010 break-even as Q1 improves

Chrysler has reported first quarter operating profit of US$143m - an improvement of US$410m - on net revenue up 3% to US$9.69bn

Chrysler has reported first quarter operating profit of US$143m – an improvement of US$410m – on net revenue up 3% to US$9.69bn.

Unveiling the results today, the company also confirmed it was targeting a minimum operating break-even this year.

“This positive operating result in the first quarter is a concrete indication to our customers, dealers and suppliers that the 2010 targets we have set for ourselves are achievable,” said Chrysler Group CEO Sergio Marchionne.

“We are also generating cash to finance the investments being made in our product portfolio and brand repositioning.”

Chrysler adds its operating profit improvement of $410m compared to Q4 2009, was driven by continued price discipline on all products and some mix improvement due to the successful launch of the Ram Heavy Duty pick-up.

On the cost side there were improved industrial efficiencies, including acceleration in the benefits from the World Class Manufacturing implementation, a more stable supplier environment and cost discipline on all discretionary spending.

“There has already been an uptick in customer traffic in our dealerships in Q1 and we are confident that Chrysler sales will continue to increase as we launch new products in the second quarter, beginning with the 2011 Jeep Grand Cherokee,” added Marchionne.

“Moreover, later this year Chrysler will launch 16 all-new or refreshed products including the Chrysler 300, Dodge Charger, E-CUV, the Fiat 500, and the Sebring replacement.”

Net loss in Q1 2010 was reduced to $197m.

Worldwide vehicle sales were 334,000 units for Q1 2010, compared to 318,000 in Q4 2009.

Improved sales were driven by the company’s US market share which increased to 9.1%, from 8.1% in Q4 2009 and Canadian market share which improved to 13.7% compared to 11.6% in Q4 2009.

Worldwide vehicle shipments in Q1 were 380,000, which included US vehicle shipments of 268,000 – both figures represented an increase of 3% compared to Q4 2009.

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