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Hit by fewer fleet sales and high interest on government loans, Chrysler posted a $199 million operating loss in it’s fourth quarter of 2010, despite generating earnings of $10.76 billion.
However, not factoring the interest on the loans from the US and Canadian governments , the company actually recorded an operating profit of $198 million in the same period.
During the course of 2010 Chrysler produced some 1.5 million vehicles, thanks to multiple new or revised product introductions and generated $42 billion in revenue, including $763 million in operating profit, in line with projected estimates for the year.
In 2011, the company hopes to go public once again, though CEO Sergio Marchionne has stated that Chrysler, which is 25 percent owned by Fiat; must report at least a ‘couple’ of quarters of net income before an Initial Public Offering of shares can be issued. In addition, in order to issue an IPO, the company has to refinance its government loans to reduce interest on the debt owned.
Chrysler has said it expects 2011 revenue to increase by nearly a third, to $55 billion, with projected net income between $200 and $500. If those targets are met, then it’s highly likely, Chrysler stock will become publicly traded once again before the end of the year.
The company also said that it plans to achieve more 13 percent US market share by 2014; currently it stands at 9.2 percent, up from 8.8 in 2009.
General Motors is expected to file for an Initial Public Offering tomorrow as the company recorded a $1.3 billion profit. GM is hoping to use the positive momentum of two consecutive quarters of profit to help move its IPO filing along.
Currently, the United States government owns 61 percent of GM. Taxpayers would have to see GM valued at $70 billion before they can break even on the $50 billion bailout given to GM during the financial crisis. GM has currently paid back $7 billion, and President Barack Obama is riding on GM’s continued financial success to vindicate his decision to bail out the company.
The IPO is expected to be worth around $20 billion, the largest since Visa’s $19.7 billion IPO in 2008.
Fuji Heavy Industries, the maker of Subaru cars, forecasted a 57% increase in quarterly profits, as sales in the United States grew while costs were reduced.
Fuji Heavy also said that they will boost production at its Indiana plant from 100,000 to 131,000 units. The plant builds Subarus as well as Toyota Camrys, as Toyota owns a 16.5 stake in Fuji Heavy.
Speaking to Reuters, Chief Executive Ikuo Mori said that Subaru may need to take further steps if it keeps growing in the United States. “It’s not that simple to add capacity, but we may have to consider some steps if sales keep growing at this pace,” he said, adding suggesting that the India plant has the potential to be expanded.
Fuji Heavy is on track for an annual profit of $474 million, with shares up 15% since last year, making it one of the best performing auto industry companies in Japan.
Strong demand in emerging markets like India and China, as well as a recovering U.S. economy helped Honda post a quarterly profit of $774 million. The Japanese automaker reported a 28 percent increase in sales, to $24.5 billion. Honda is forecasting a $3.7 billion profit through the coming fiscal year (which ends March 31, 2011), and sales of $100.4 billion, a 9 percent jump.
The strong results come days after Honda’s CEO admitted that the company had become “complacent”. However, strong demand for small, energy efficient models like the Fit and the upcoming CR-Z hybrid sports car helped the company back into the black. Honda’s motorcycle division also reported strong sales, adding to the company’s fortune.
[Source: Detroit News]