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AUBURN HILLS — Chrysler Group LLC today reported a net loss of $370 million for the second quarter of 2011, but the automaker's operating profit increased 177 percent over the same three-month period a year ago.
The loss was explained by a one-time charge of $551 million that Chrysler took during the quarter to repay money it borrowed from the governments of the United States and Canada in 2009. Without that charge, the company would have made $181 million, reported The Detroit News.
"There is no doubt that Chrysler Group has taken a huge step forward this quarter," said Chrysler CEO Sergio Marchionne.
"Refinancing our debt and repaying our government loans six years early reinforces our conviction that we are on the right path to rebuilding this company and restoring it to its rightful place on the global automotive landscape."
Crosstown rival Ford Motor Co. today reported a slight dip from last year in second quarter earnings, to $2.4 billion, as it, too, further cleaned up its balance sheet and reported higher costs.
Chrysler's net revenues were $13.7 billion, up 30 percent from $10.5 billion in the second quarter of 2010. Chrysler's U.S. market share increased to 10.6 percent from 9.4 percent, while its Canadian market share increased to 14.9 percent from 12.9 percent.
Worldwide, Chrysler's sales increased 19 percent to 486,000 units in April, May and June. July sales will be announced next week.
"Chrysler has been making a remarkable recovery over the last several months, and it's proving to be an important and valuable asset for Fiat," said analyst Michelle Krebs of Edmunds.com, an online automotive research firm.
The Italian automaker took over bankrupt Chrysler as part of deal brokered by the Obama administration in 2009.
Chrysler ended the quarter with $10.2 billion in cash and $12.3 billion in debt.
The company expects total net revenue for the year will exceed $55 billion and predicts adjusted net income of between $200 million and $500 million, excluding the one-time loan repayment charge reported during the second quarter.
"We are changing both the image and substance of our company in order to regain the faith of consumers," Marchionne said.
Last week, the U.S. and Canadian governments sold their Chrysler stakes to Fiat, giving it a controlling share of the Auburn Hills automaker. Marchionne is expected to announce an operational merger of the two companies in the next few days.
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