Chrysler Group LLC, the automaker controlled by Italyís Fiat SpA, reported second-quarter net income Monday of $436 million as the company plans to extend gains in car sales with the new Dodge Dart compact.
The quarterly profit compared with a year-earlier loss of $370 million, the Auburn Hills, Mich.-based company said. Chryslerís second-quarter 2011 results included a one-time $551 million cost for repaying government loans. Sales increased 23 percent to $16.8 billion.
Chrysler affirmed its forecast that net income will rise to about $1.5 billion this year, buoying results for its majority owner as Europeís debt crisis sends sales in the region to a fifth consecutive drop.
Chryslerís U.S. sales of cars surged 42 percent during the second quarter from a year earlier, driven by demand for the Chrysler 200 and 300 sedans, according to researcher Autodata Corp.
ďChrysler really has hit the ball out of the park here in the first half, gaining additional market share in the U.S.,Ē said Richard Hilgert, a Chicago-based analyst for Morningstar Equity Research before the results were released. Sales gains probably will continue in the second half because of the Dart, which will reach full inventory at dealers by September, he said.
Chrysler reported it had $12.1 billion in cash at the end of the quarter, up from $11.3 billion as of March 31. Net industrial debt dropped to $432 million from $1.3 billion at the end of the first quarter.
Sergio Marchionne, chief executive officer of both Chrysler and Fiat, plans to merge the two companies and increase sales to $123 billion by 2014. Fiat will boost its ownership stake of Chrysler to 61.8 percent by exercising an option to buy an additional 3.3 percent from the United Auto Workersí retiree health-care trust, the company said July 3.
Fiat shares have climbed 18 percent this year in Italian market trading.
Chrysler Groupís total U.S. sales rose 30 percent from a year earlier to 834,068 cars and light trucks during the first half, according to Autodata. Sales of the Chrysler brandís 200 more than doubled and 300 sedans almost tripled in the first half from a year earlier.
The company topped the industryís 15 percent increase, boosted by demand for redesigned or refreshed models such as the Jeep Grand Cherokee sport utility vehicle. Chryslerís U.S. market share rose 1.4 percentage points from a year earlier to 11.5 percent, Autodata said.