Chrysler hopes its crisis remains in its rearview mirror. After engineering an automotive resurrection by choosing a back-to-basics alliance with Fiat, the carmaker continues to manufacture its Chrysler brands, including Dodge, Fiat, Jeep Grand Cherokee, Jeep Wrangler, Town & Country, and Ram vehicles at more than 30 plants. It ships some 2.4 million vehicles every year. Chrysler's trademarked MOPAR (MOtor PARts) automobile parts and service division carries almost 300,000 parts, options, and accessories for vehicle customization. Chrysler Group emerged from a US government backed Chapter 11 bankruptcy in mid-2009. Fiat controls the company. It filed an IPO in 2013 but withdrew it in early 2014.
Chrysler filed an IPO seeking to raise up to $100 million, but it would have likely fetched several billion. The company cancelled its IPO plans after the UAW union agreed to sell its 40% stake to Fiat.
Chrysler started its rebound from Chapter 11 bankruptcy in 2009 once the US Bankruptcy Court gave its approval for the company to merge its assets with those of Fiat. With no cash changing hands, Fiat initially took a 20% equity stake in Chrysler with a plan to increase its share as Chrysler reached certain performance levels. Adhering to this plan, Fiat eventually increased its stake to nearly 62% in mid-2012.
The company owns or leases 22 manufacturing plants in the US (mostly in Michigan, Indiana, Ohio, and Illinois). Seven more are located in Mexico, six are in Canada, and one is in South America. Altogether, its cars are available in more than 150 countries.
Strong demand continued to boost Chrysler's sales and the company posted a 20% revenue jump for 2012 along with a whopping 811% increased in net income. The revenue jump is attributed to a 22% increase in the number of vehicles shipped worldwide while net income benefited from a lack of debt burden since the company paid off the US Treasury.
From 2010 to 2011 Chrysler's total sales surged by 31%. The growth was the result of an increase in the demand for its new cars and the overall strengthening of the US automotive market, which recorded an 11% increase in industry vehicle sales for 2011. Revenue from the US spiked by 34% and accounted for nearly 70% of its total revenue for 2011. It attributes about $1.6 billion of its overall revenue increase to more favorable pricing of its 2011 and 2012 model year vehicles.
After suffering three straight years of net losses since the recession, Chrysler finally achieved profitability in 2011, posting net income of $183 million. The positive net income was largely due to the surge in total sales but was offset by the repayment of debt owed to the US government. Another factor that affected its growth in profits was the higher advertising expenses involved in the retail launch of 13 new vehicles in 2011.
Chrysler expects the Fiat partnership to continue to help it reduce development costs (the company already cut billions in operating costs) and to achieve access to the Italian company's small-car expertise and global markets. It also plans to focus on mid-size commercial vans.
Though Chrysler has a penchant for large sedans, it will be making the new Fiat four-cylinder engine and has produced smaller Chrysler-brand cars that are based on Fiat designs and technology. In fact, Chrysler is idling six of its V-6 engines, keeping only one -- the Pentastar V-6, which powered 13 Chrysler models by 2013. Also that year, the company re-entered the compact market when it relaunched its Dodge Dart.
One of the last hold-outs among the top-selling automobile manufacturers to produce a hybrid, Chrysler sold its subsidiary Global Electric Motorcars (GEM) to off-road vehicle maker Polaris in 2011 as interest and investment in the low-emission small vehicle market waned.