Chrysler Increases Profit
In a press release, Chrysler has just reported that the company finished 2012 with a profit 68% larger than in 2011. The company reported a profit of $1.7 billion US Dollars, which is nine times higher than the amount of profit gained in 2011 – $183 million. The increase in profit is partly due to the fact that in 2011 Chrysler had to spend a large amount of money to repay the US government after the bailouts which saved the company from bankruptcy in 2009.
The large increase in profit for Chrysler is also attributed to the large sales rebound in the USA in general. Chrysler was the only domestic automaker that managed to gain extra market share in the US, while other companies such as Ford and GM gained ground in emerging global markets. The US market is so important for Chrysler, that is sold roughly half of its worldwide units there last year, which also shows the company’s reliance on a single market. In a time when companies like Volkswagen and GM are making enormous gains in China, Chrysler is barely visible on that skyrocketing market, where millions of new car buyers enter the market each year. With over 1 billion citizens and double-digit economic growth for several consecutive years, China is the destination for most major western carmakers. Chrysler doesn’t seem to have a strong strategy for breaking into the Chinese market, although it has had excellent success in its home base.