Chrysler Posts ‘Impressive’ Profit on Lower Costs
Chrysler Group LLC, the U.S. automaker run by Fiat SpA, said it posted a $143 million operating profit in the first three months of the year after cutting costs and introducing a big pickup, Bloomberg reported.
Revenue rose to $9.69 billion (7.21 billion euros) in the first quarter, up 2.7 percent from the final three months of 2009, the Auburn Hills, Michigan-based automaker said in a statement. Chrysler reported a net loss of $197 million in the first quarter, compared to a net loss of $2.69 billion in the final three months of last year.
After emerging from bankruptcy June 10 through the end of 2009, Chrysler said it lost $3.8 billion on revenue of $17.7 billion. Fiat obtained a 20 percent stake in Chrysler after the company reorganized in Chapter 11 with $15 billion in government support.
“It’s an impressive result and shows how much cost was taken out by Chapter 11 and Fiat’s actions,” said Max Warburton, an analyst at Bernstein Research in London. “The accounting remains opaque and current costs may not be sustainable. But it certainly makes it easier for investors to believe that with economic recovery, Chrysler is likely to make further progress.”
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