Chrysler Group LLC made $1.8 billion in 2013, continuing to prop up its financially struggling parent company and demonstrating why the merger announced Wednesday is so important to Fiat SpA.
With Chrysler’s contribution, the Italian automaker made 1.95 billion euros ($2.67 billion) for the year. Without Chrysler’s contribution, Fiat would have posted a loss of 911 million euros ($1.25 billion).
But even with a common name — Fiat Chrysler Automobiles — and a new logo, limits remain on how much of Chrysler’s cash Fiat will be able to tap.
Chrysler earned $659 million in the last three months of 2013, its tenth consecutive quarterly profit. And thanks to Chrysler, Fiat was able to post fourth-quarter net income of almost 1.3 billion euros ($1.77 billion).
That was a big increase over the 224 million euro net profit Fiat reported for the same period in 2012, but most of the gain came from the recognition of deferred tax assets. Excluding such special items, Fiat’s fourth-quarter profit was just 252 million euros ($344 million), down from 336 million euros a year earlier, and the the company only made 943 million euros ($1.29 billion) for the full year, down from 1.14 billion.
The results fell short of expectations on both sides of the Atlantic, and the company’s new forecast for 2014 did little to reassure investors.
The newly merged Fiat-Chrysler group said it expects to make between 600 million and 800 million euros ($819.8 million to $1.09 billion) in 2014 on revenue of approximately 93 billion euros ($127.1 billion).
CEO Sergio Marchionne said the European car market remains weak. He said the only hope of a real rebound in the region lies with Fiat’s luxury brands: Alfa Romeo, Maserati and Ferrari.