Jump in Chrysler earnings boosts money-losing Fiat – USA TODAY
Chrysler Group’s fourth-quarter net income more than quadrupled to $1.62 billion, aided by $962 million in one-time tax benefits.
Without the benefits, the company made $659 million, still 74% more than a year ago.
Chrysler’s performance helped to prop up Fiat, its Italian owner, which made 252 million euros ($345 million) excluding one-time items. Without earnings from Chrysler, Fiat would have lost 235 million euros ($321 million).
Fiat’s board of directors said it would not pay dividends this year, although Fiat/Chrysler CEO Sergio Marchionne said Fiat worker would get bonuses.
The Fiat board also could announce a name today for the combined Fiat/Chrysler, and designate what stock exchange would handle primary trading for shares of the joint company. Fiat’s Fiat North America unit earlier this month acquired the remaining stake in Chrysler than it did not already own.
For the full year, Chrysler made $1.8 billion excluding tax benefits, its best performance since leaving bankruptcy in 2009.
Fiat owned 58.5% of Chrysler last year. It has since bought the rest from a trust fund that pays health care bills for union retirees.
Fiat North America, the unit that owns 100% of Chrysler Group, paid a total of about $6.3 billion for the automaker, less than half the $13.3 billion in cash Chrysler reported on hand at the end of the year.
Fiat North America is using $2.6 billion of that to help finalize the buyout.
Marchionne engineered “a bit of a coup,” getting the now-healthy Chrysler Group for a relative pittance, Max Warburton, industry analyst at Bernstein Research, said when the buyout was announced Jan. 2.
Chrysler’s 10th-straight profitable quarter came because of strong U.S. sales of Ram pickups, Jeep Grand Cherokees and the new Cherokee model.
Marchionne said the strong year-end showing reflects ” the commitment Chrysler Group has made to rapidly refresh our
Chrysler’s year-end market share in the U.S. was 11.4%, up from 11.2% a year earlier.
Chrysler forecast this year’s results would be:
•Net income of $2.3 billion to $2.5 billion, up from $1.8 billion in 2013
•Revenue of $80 billion, up from $72.1 billion.
Contributing: The Associated Press