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Chrysler’s second-quarter net income up 16 percent on U.S. sales

By Dee-Ann Durbin
Associated Press

DETROIT: Chrysler said Tuesday that its sales picked up in the second quarter thanks to strong U.S. demand for trucks and SUVs. But the company cut its target for full-year sales and profit, blaming persistent problems as it adds more shifts and ramps up production of vehicles such as the Ram pickup and the Jeep Cherokee small SUV.

“You need to remember that in 2010 we produced 1 million cars. We’re now at 2› times that level,” Chrysler CEO Sergio Marchionne said.

Marchionne said making sure Chrysler has enough parts from suppliers has been a problem. Engineers are still making adjustments to the Cherokee’s new nine-speed transmission, for example, even though the first Cherokees began rolling off the line in June.

Chrysler is also adding more workers, including the second shift of 1,100 people who will start making Cherokees next month and the 1,250 people who will start making transmissions in Kokomo, Ind., early next year.

Chrysler’s first-quarter sales suffered because it was slow to release new versions of the Ram pickup and Jeep Grand Cherokee SUV, two of its most popular vehicles.

Those production issues were resolved by the second quarter. Ram sales in the U.S. rose 30.4 percent over last year. It was the Ram’s best second quarter since 2007. Grand Cherokee sales soared 27 percent.

Chrysler sold 643,000 vehicles worldwide in the second quarter, up 10 percent from a year ago. Sales were also up 10 percent in the U.S., where Chrysler sells 75 percent of its vehicles. Chrysler said its net income rose 16 percent to $507 million in the April-June period from $436 million a year ago. Revenue rose 7 percent to $18 billion from $16.8 billion.



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