Chrysler posts first-quarter loss, begins shipping 200 midsize
By Bernie Woodall
DETROIT (Reuters) - Chrysler Group LLC expects increased vehicle shipments linked to the new Chrysler 200 midsize sedan will not have a great effect on earnings until the third quarter, its chief financial officer said on Monday.
Shipments of the Chrysler 200 began a week ago but it will take time for the pipeline to fill, said CFO Richard Palmer as he discussed Chrysler's first-quarter earnings with analysts.
Sergio Marchionne, chief executive officer of Italian parent Fiat SpA FIA.MI as well as Chrysler, did not participate in the analysts' conference call after Chrysler reported a $690 million loss in the first quarter.
Chrysler, the No. 3 U.S. automaker, said the loss was due to charges related to the merger of the two companies.
Chrysler took a $504 million non-cash charge on payments to retire a note linked to a union healthcare trust that was the company's minority owner until January and a $672 million charge for payments to the United Auto Workers retiree healthcare trust in the United States.
Excluding the items, Chrysler posted a profit of $486 million, up from $166 million a year earlier.
In January, Fiat bought the remaining shares owned by the trust and became the sole owner of Chrysler. The newly merged company, Fiat Chrysler Automobiles, is expected to be listed on the New York Stock Exchange in the fourth quarter.
The redesigned Chrysler 200 is built at a suburban Detroit plant that was slated for closure in 2009 but was recently upgraded at a cost of $1 billion. Critics have said it is a vast improvement over the outgoing Chrysler 200, whose sales were less than one-third of the midsize sedan leader, Toyota Motor Corp's (7203.T: Quote)(TM.N: Quote) Camry last year. Continued...