Wednesday, July 22, 2009

Fiat loses a quarter of a billion in second quarter

How can a company lost over $250 million in the second quarter of 2009 save Chrysler?

FT reported:
Fiat, the Italian carmaker, on Wednesday reported a steep loss for the second quarter of 2009 in “an extremely difficult trading environment”, but stuck with its forecasts for its full-year financial performance.

The Turin-based group, which has sought to spearhead a global restructuring of the ailing automotive industry through its acquisition of Chrysler and attempts at taking over the European operations of General Motors, made a net loss for the three months to June 30 of €179m ($254m).

That compared with a net profit of €646m in the same period last year and illustrates the scale of the slump in the global car industry caused by the credit crisis. Revenues fell 22.5 per cent to €13.2bn, the group made a trading profit of €310m compared with €1.13bn in 2008, and net industrial debt decreased to €5.7bn from €6.6bn at the end of the first quarter.

“The global economic crisis continued to have a significantly negative impact on demand levels for all of the Group’s businesses, but with signs of improvement in certain markets compared with Q1 levels,” Fiat said in a statement on Wednesday accompanying the results.

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