Chrysler had its best quarterly profit in 13 years. Not bad for a company that almost died three years ago.
The company earned $473 million (Dh1.7 billion) in the first quarter, mainly from strong US sales, which rose 39 per cent from January until March. Customers snapped up Ram pick-ups, Jeep Grand Cherokee SUVs and Chrysler 200 sedans.
The profit was more than four times what Chrysler made a year earlier. And it was the best performance since the third quarter of 1998 when Chrysler earned $682 million during the pick-up truck and SUV boom.
“I have no bad news to tell you,” Chrysler CEO Sergio Marchionne said on Thursday, adding that trends for the rest of year look positive.
Another reason Chrysler made so much money is because it’s generating more cash every time it sells a car or truck. It’s getting an average of $29,234 per vehicle in the US, up almost 5 per cent over last year, according to the TrueCar.com auto pricing website. When sales and prices both rise, that generates more revenue and profit. Revenue for the quarter rose 25 per cent to $16.4 billion.
It’s a big change from 2009. The recession, which devastated auto sales, brought the company to the brink of financial ruin. Chrysler and its financing arm needed $12.5 billion from US taxpayers to survive. When a government auto task force deadlocked on whether to save the collapsing company, the tie had to be broken by President Barack Obama.