Higher sales of Jeeps and other new vehicles propelled Chrysler to its first annual net income since 1997, capping a pivotal turnaround that many thought would never happen.
The US carmaker, now privately held and majority owned by Italy's Fiat SpA, earned $US183 million ($A171.65 million) last year, reversing a $US652 million loss in 2010, its first full year out of bankruptcy protection.
Just three years ago Chrysler was close to running out of cash and heading for the auction house. But a government-funded bankruptcy cut debt and expenses, and Chrysler spent last year rolling out 16 new or revamped models to boost sales. Now the company is expanding into small cars and adding jobs.
Chrysler expects an even better 2012, despite a sluggish and uncertain economy. The company, which sells most of its vehicles in the US, predicts it will make about $US1.5 billion this year and increase revenue 18 per cent.
"We're looking at 2012 with some degree of optimism," CEO Sergio Marchionne said on Wednesday. "It's not going to be a walk in the park ... but I think we've got all the elements in place."
Marchionne cautioned that costs will rise in 2012. It will spend billions to promote the new Dodge Dart compact car and to develop a slew of new cars and trucks that will hit the market next year.
Chrysler spent much of 2010 designing new vehicles and trying to spruce up an archaic lineup that wasn't selling well.
Now those vehicles are in showrooms, and they've sold far better than expected, especially the Jeep Grand Cherokee 4WD. The company's global sales climbed 22 per cent to 1.86 million last year. US sales growth was even faster, up 26 per cent.
As a result, the company brought in more money. Revenue totalled $55 billion last year, 31 per cent higher than in 2010. The added cash, along with relatively low expenses after bankruptcy, and savings from combining technology and engineering with Fiat, helped Chrysler turn itself around.
Chrysler's profit has created a role reversal of sorts. When the US government picked Marchionne to take control of Chrysler after the bankruptcy, Fiat was seen as a saviour. Now Fiat, which owns 58.5 per cent of Chrysler, is struggling and may need the US company's help to survive economic problems in Europe.
Fiat reported a $1.71 billion net profit for last year on Wednesday, but Marchionne said all of that came from Chrysler.
Chrysler has announced a number of new vehicles for this year and next but still faces strong competition in its main market, the US.
Although its US market share rose 1.3 percentage points to 10.7 per cent, it came during a year in which Honda and Toyota dealers ran short of models because the March earthquake and Tsunami in Japan. The disasters hampered their factories' output.
Still, US auto sales are expected to rise by about a million this year, to near 14 million, and Chrysler is expected to get a share of the increase.
President Barack Obama has been touting Chrysler's turnaround in recent appearances ahead of the November presidential election. Obama cast the deciding vote to save Chrysler and authorised much of the $12.5 billion in government funding that bailed out the company. Of the original bailout to Chrysler and its financial arm, the government said it was repaid all but $1.3 billion.
Chrysler now employs 57,200 people, 9,400 more than it did when the company left bankruptcy protection in 2009.
Chrysler's turnaround last year was largely on the back of the Jeep brand, which saw sales rise 44 per cent for the year.
