Last week, Ford's second-quarter earnings figures proved that the automaker is still going strong, but also showed that Europe's financial woes are hindering Ford's progress. Now, Chrysler has released its own outstanding financial results for April, May, and June, but could Fiat kill the party?
The numbers confirm that Chrysler has, indeed, turned a corner. Here are the major takeaways:
- During the second quarter, Chrysler netted a profit of $436 million -- a staggering improvement over Q2 of 2011, when the automaker saw a $370 million loss after repaying bailout funds to the U.S. and Canada. (It's even vastly better than the $181 million adjusted net profit seen that quarter.)
- Total revenue for the three months was a very impressive $16.8 billion, which is 23% higher than the $13.7 billion seen one year ago.
- Around the globe, Chrysler sold 582,000 vehicles in the second quarter, a 20% improvement over the 486,000 sold in Q2 of 2011.
- Not surprisingly, Chrysler's performance was strongest in North America, which saw a 32% jump in retail sales compared to Q2 of 2011 and a 24% increase overall.
- According to a Chrysler press release, the automaker has seen 27 consecutive months of growth in year-over-year sales.
- Chrysler's U.S. market share has now edged up to 11.2%, from 10.6% a year ago.
- The company's big sellers continue to be the Chrysler 300 and the Jeep Wrangler, the latter of which hit an all-time sales record in June.
However, it's not all sunshine and lollipops at Pentastar Central.
The vast majority of Chrysler's business -- nearly 88% -- is conducted here, in North America. That means that Chrysler is far less exposed to the economic troubles rocking Europe at the moment.
Chrysler's parent company, Fiat, isn't so lucky. Fiat is expected to release its own earnings later today, and it would be foolish to be optimistic about the company's prospects. Ford's European unit is bracing for a $1 billion loss this year, and we'd be surprised if Fiat didn't tell a very similar story.
Remember when everyone laughed at the idea of Fiat buying Chrysler? When we all snickered at Sergio Marchionne's proposal and thought to ourselves, "Yeah, good luck with that", assuming that Chrysler would be the albatross around Fiat's neck?
Funny how things change.
In related news, Marchionne sent a memo to Chrysler employees yesterday, thanking them for their hard work but encouraging them not to rest on their laurels. (Detroit News posted a copy of the memo here.) It's great advice from a man whose thoughtful, even-keeled manner is needed now more than ever to guide Fiat back toward the black.