July 1, 2022

Chrysler Reports a Profit Drop of 65%

DETROIT – Chrysler Group said Monday that its net income fell 65 percent in the first quarter, to $166 million, as the automaker spent heavily to prepare for new product introductions.

Chrysler, the smallest of Detroit’s three auto companies, said revenue dropped 6 percent in the quarter, to $15.4 billion despite an 8 percent increase in new vehicle sales. The weaker results indicated that Chrysler is still solidifying its comeback from a government bailout and bankruptcy in 2009.

But the company’s chief executive, Sergio Marchionne, reaffirmed earlier forecasts that Chrysler would earn $2.2 billion for the full year on revenue of $72 billion or higher.

“We remain on track to achieve our business targets, even as the first-quarter results were affected by an aggressive product-launch schedule,” said Mr. Marchionne, who is also chief executive of Chrysler’s parent company, the Italian automaker Fiat.

Fiat, which owns 58.5 percent of Chrysler, is scheduled to report its first-quarter results later today.

The first-quarter results mark Chrysler’s seventh consecutive profitable quarter. The company reported that it sold 563,000 vehicles worldwide during the three-month period, an 8 percent increase from the same period a year ago. Most of the additional sales came in the United States, where Chrysler said its market share improved slightly to 11.4 percent, up from 11.2 percent in the same period in 2012.

Chrysler’s turnaround since the recession has been built on reviving core products, like Jeep sport utility vehicles and Ram pickups, as well as bringing out new models like the Dodge Dart compact car. Competition is increasing among all automakers in the American market, which is growing while demand is sliding in Europe and other important international markets.

Chrysler said its lower profits in the quarter reflect costs associated with the introductions of new versions of its Jeep Grand Cherokee S.U.V. and heavy-duty Ram pickup, and second-quarter production of the new Jeep Cherokee.

The company said its cash reserves improved to $11.9 billion during the quarter, up from $11.3 billion a year ago. Its overall debt was $12.5 billion, about the same as it reported in the first quarter of 2012.

Article source: http://www.nytimes.com/2013/04/30/business/chrysler-reports-a-profit-drop-of-65.html?partner=rss&emc=rss

Car Sales Continue Their Climb

General Motors, the largest of the Detroit auto companies, said it sold 194,000 cars and trucks during the month, a 15.9 percent increase over the same period a year ago. The company said all four of its brands — Chevrolet, Cadillac, GMC and Buick — had double-digit increases in January.

G.M. also rebounded from tepid sales of its core pickup trucks in recent months. The company said sales of its Chevrolet Silverado pickup increased 32 percent compared to January 2012, and sales of the GMC Sierra improved 35 percent.

“The year is off to a very good start for General Motors,” said Kurt McNeil, head of G.M.’s United States sales operations. “There’s a sense of optimism among our dealers that only comes when you pair a growing economy with great new products.”

Last year, the overall American auto industry had its best performance in five years with sales of 14.5 million vehicles — a 13 percent increase over 2011.

Automakers and industry analysts are forecasting sales this year to be as high as 15.5 million vehicles. The optimistic projections were in part because of a growing need by consumers to replace aging vehicles, as well as improvements in the economy.

Ford Motor Company, the second-biggest of the Detroit automakers, said its sales in January rose 21.8 percent to 166,000 vehicles.

Ford reported that its passenger cars did particularly well, with an increase for the month of 34.1 percent. Sales of the recently redesigned Ford Fusion midsize sedan increased 64.5 percent.

Executives at Ford said the company expects consumer demand to consistently grow in 2013.

“The biggest driver of the year is going to be replacement,” said Ken Czubay, Ford’s United States sales and marketing chief.

Chrysler, the smallest American car company, said it sold 117,000 vehicles in January. That was a 16.3 percent increase over the same month in 2012, and extended Chrysler’s year-over-year sales gains to 34 consecutive months.

Chrysler said sales of cars rose about 50 percent during the month, while sales of SUVs and trucks increased by 3 percent. Its new small car, the Dodge Dart, had its best performance since being introduced last summer, the company said.

Toyota, the largest Japanese automaker, said its sales in January grew 26.6 percent to 157,000 vehicles.

Article source: http://www.nytimes.com/2013/02/02/business/car-sales-continue-their-climb.html?partner=rss&emc=rss

Demand for Small Cars Pushed April Sales Up 18%

General Motors led the Detroit automakers last month with a 27 percent gain in American sales, led by strong demand for its Chevrolet Cruze compact sedan and smaller, more fuel-efficient sport utility vehicles.

The auto companies attributed the surge in small-car sales to gas prices, which are approaching $4 a gallon. “Rising fuel prices have led many to rethink their vehicle of choice,” said Don Johnson, G.M.’s vice president for United States sales.

The higher demand for small cars has caused shortages of some models, particularly at Toyota, which is struggling to maintain an adequate supply because of production disruptions from the earthquake in Japan.

But over all, the demand for compact and subcompact cars is keeping the industry on track for a slow but steady recovery from recession-era sales levels.

The auto companies said sales for the year were running at an annual rate above 13 million vehicles for the third consecutive month.

The results are more impressive considering that incentive spending has dropped an average of $500 a vehicle from the period a year ago.

“Pent-up demand has been building in the industry for the last few years,” Mr. Johnson said. “The average age of vehicles is now above 10 years, the highest level ever.”

One of the hottest car companies during April was Hyundai, a Korean company, which rode the success of its new Elantra sedan to a 40 percent overall improvement in sales. Hyundai sold more than 22,000 Elantras in the month — up from 9,600 a year ago.

All three Japanese automakers lagged the market, especially Toyota, where sales increased about 1 percent. A Toyota executive said that the company was running low on inventories of two of its most fuel-efficient cars, the Prius hybrid and Corolla subcompact, because of factory shutdowns after the earthquake and tsunami in northern Japan.

“We’re feeling it in some models already,” said Bob Carter, head of Toyota’s sales operations in the United States. “There was an interruption in the flow of Corolla and Prius inventory from Japan.”

Toyota has less than a 10-day supply of Priuses, and about a 40-day supply of Corollas, he said. Other hybrid models, like the Lexus RX crossover, have been affected by major parts shortages as well.

Mr. Carter said that Toyota’s North American assembly plants were running at about 30 percent capacity. Japanese factories are closed for holidays, but are expected to reopen next week at half-speed.

“We will be ramping up this summer and be reaching normal production levels before the end of the year,” he said.

Honda’s sales increased 10 percent in April, and Nissan reported a 12 percent increase.

Nissan said it sold 573 Leafs in April, the best month so far for the all-electric sedan, which has been available in limited numbers. By comparison, G.M. sold 493 Volts, its plug-in hybrid.

The performance by General Motors was built on a substantial increase in passenger-car sales, which were up 50 percent in April from a year earlier. Sales of its full-size pickups increased only 2 percent in the month.

Ford reported a 16 percent jump in sales, with high demand for its new Fiesta and Focus small cars and its new and lighter version of the Explorer S.U.V.

A Ford executive said that the company was hard pressed to keep up with orders for the new Focus.

“Dealers were telling us they were selling them right off of the convoy truck,” said Ken Czubay, Ford’s head of United States sales and marketing.

The smallest of Detroit’s Big Three, Chrysler, appears to finally be seeing the benefits of an overhaul of its product lineup after emerging from bankruptcy two years ago.

Chrysler said its sales increased 23 percent for the month, and its car sales rose 41 percent from a year ago. The company also sold 882 Fiat 500 micro-cars, the first models it has introduced in the United States from its Italian partner.

The overall increase in sales came as incentive levels continued to fall.

Automakers spent an average of $2,100 on incentives during the month, compared to $2,600 in April of last year.

The largest rebates — about $3,200 a vehicle — were found on large trucks, according to the auto research Web site Edmunds.com.

“Demand has shifted toward smaller cars just as car companies are experiencing inventory shortages of those very vehicles,” said Jeremy Anwyl, chief executive of Edmunds.

“They are focusing their dollars where there are gaps between demand and supply, such as in the pickup-truck segment,” he said.

Article source: http://feeds.nytimes.com/click.phdo?i=9fde99a5453ec2bd3d5bcf04eb1b834a