* Chrysler Q4 net income $225 mln vs $199 mln loss yr ago
* Chrysler 2012 revenue target about $65 bln
* Chrysler 2012 net income target about $1.5 bln
* Fiat also reports Q4, full-year results on Wednesday
By Bernie Woodall
DETROIT, Feb 1 U.S. automaker Chrysler
Group LLC swung to a full-year net income of $183 million on
Wednesday, and made the bold prediction that profit would be
eight times higher in 2012, on strong sales in its main U.S.
In its second full year managed by Italy's Fiat SpA
and its hard-charging chief executive Sergio Marchionne,
Chrysler turned a net profit of $183 million, up from a loss of
$652 million in 2010. The company set a target for about $1.5
billion in net profit in 2012.
Chrysler 2011 sales reached $54.98 billion, a 31-percent
rise from 2010, linked closely to strong sales in its home U.S.
Marchionne, also the CEO of Chrysler, said of the
Detroit-area automaker, "Our house is in good order."
Later on Wednesday, Marchionne will address the state of the
larger Fiat, which also reports quarterly and annual results.
Fiat took control of the third-biggest U.S. automaker in
2009 as part of a government bailout.
Last year was the first time a company named Chrysler
reported a net income since 1997, when the company showed a net
profit of $2.8 billion.
From 1998 until 2007, as a unit of Daimler AG,
Chrysler reported only an operating profit or loss, and last
posted an operating profit in 2005, at $1.8 billion. It did not
post profits when from 2007 to 2009 when it was owned by private
equity firm Cerberus Capital Management.
SHORING UP FIAT
As European auto sales sink amid a sovereign debt crisis, it
is Chrysler that is now shoring up Fiat. In the third quarter,
Chrysler made up two-thirds of Fiat's profit.
Net income for the fourth quarter of $225 million was the
largest net profit since the new Chrysler was formed after its
2009 bankruptcy and restructuring.
The company said full-year 2011 adjusted net income would
have been $734 million excluding a $551 million charge linked to
Chrysler's repayment in May of U.S. and Canadian government
Chrysler also said it was targeting an 18-percent jump to
about $65 billion in revenue in 2012. It also said its modified
operating profit was targeted to reach at least $3 billion in
2012, about 50 percent higher than in 2011.
The higher profit would come, Chrysler said, from a nearly
30-percent jump in company global auto sales to 2.4 million
vehicles from 2011's 1.86 million.
While Chrysler is working to expand its sales base beyond
North America -- a stipulation of its bailout -- about 85
percent of its 2011 sales came from the United States and
Chrysler said it expected to gain cost savings in 2012
because it has fewer costly vehicle launches than it had in 2011
or will have in 2013. Its annual profit was a result of the
spate of new or freshened products launched in 2010 and 2011,
such as the Jeep Grand Cherokee and the Chrysler 200 sedan.
A key launch this year will be the Dodge Dart small sedan,
built in Illinois on a platform from Fiat brand Alfa Romeo.
While Chrysler made strides in 2011 it still lags far behind
cross-town rivals General Motors and Ford.
Ford posted a 2011 pre-tax operating profit of $8.8 billion
and GM posted operating profit of $7.7 billion in the first
On Tuesday, Fiat Chairman John Elkann said the sovereign
debt crisis in Europe was "even bigger" than the 2008-2009
financial crisis that led to Chrysler's near-death experience
and its partnership with Fiat.
Elkann said Italian auto sales would be as low in 2012 as
they were in 1985, which he said, "requires us to rethink again,
very carefully, what we can do and how we will move forward."
Marchionne issued similar warnings last month at the Detroit
auto show, saying the Fiat Group was open to a third partner to
help it reach its 2014 sales target of selling 6 million
In December, Marchionne said the third partner could be
added before a Chrysler IPO, which he said was possible in 2013.
Fiat raised its ownership stake of Chrysler in January to
58.5 percent. The remaining 41.5 percent is owned by the retiree
healthcare trust affiliated with the United Auto Workers union.