The new 2014 Jeep Cherokee is arriving in dealerships, but a bit too late to create a bump in Chrysler Group LLC's third quarter earnings, announced Wednesday.
It was the ninth consecutive quarterly profit for Chrysler, which saw revenue increase by 13.5 percent from a year earlier, to 17.6 billion from 15.5 billion, on the strength of pickup truck sales.
Chrysler CEO Sergio Marchionne said the company learned from the experience of an almost one-year gap between the discontinuation of the Jeep Liberty and the delayed arrival of the Liberty's replacement, the Cherokee.
"We are never going to take a plant down for over a year and be out of the market as we have been," Marchionne said of the Liberty/Cherokee gap during a conference call Wednesday. "We were actually just naked for the whole of 2013."
Concerns over Chrysler parent Fiat S.p.A's position clouded otherwise positive news from Wednesday's report, which saw earnings rise 22 percent in the three months ending Sept. 30, to $464 million.
Fiat, which owns nearly just under 60 percent of Chrysler, would have posted a loss of about $261 million this quarter without Chrysler, although that was a significant improvement from a year earlier, when the Italian carmaker posted a $390 million loss.
Chrysler also paid $600 million into the UAW Medical Benefits Trust, which owns 41.5 percent of the company, as scheduled, during the third quarter. That payment caused Chrysler's cash to dip from $11.9 billion to $11.5 billion.
Marchionne said he was "quite happy with what we got done" despite the production delays surrounding the Cherokee, which started arriving in dealerships in October rather than August as planned.
The company set an original goal early this year of $2.2 billion in net income, an estimate which was scaled down to $1.7 billion in July. Wednesday, Marchionne said the $1.7 billion goal was "all within the realm of the possible."
The company continues to expand. On Oct. 10, Chrysler officials announced $1.2 billion in planned investments for two plants in Saltillo, Mexico, and said they expected to hire 1,570 workers there.
That comes on top of an even larger investment over the past two years in the company's Kokomo transmission plants, where an additional 2,500 workers have been hired.
During the quarter, net revenue was driven primarily by increased vehicle shipments, particularly of Dodge Ram trucks and Jeep Grand Cherokee SUVs. The company shipped 593,000 vehicles in the quarter, compared to 559,000 a year ago.
Chrysler's U.S. market share remained steady, at 11.2 percent, compared to 11.3 percent a year ago. The company's international vehicle sales were up 20 percent for the quarter, with 82,000 vehicles sold outside the U.S.
(c)2013 the Kokomo Tribune (Kokomo, Ind.)
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Distributed by MCT Information Services
Original headline: Chrysler shows profit again in 3Q
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