Chrysler reported net losses of nearly $4 billion since it emerged from bankruptcy last year, but it had an operating profit in the first quarter and affirmed that it was on track to break even in 2010.
The automaker reported a $197 million first-quarter net loss on Wednesday but said its cash flow turned positive due to sweeping cost cuts it made during its 2009 bankruptcy.
But the accumulated losses since it emerged from bankruptcy in June underscored continuing pressure from a nonstop slide in its sales and market share.
Chrysler posted a $3.8 billion net loss from June 10, when it emerged from a U.S. government-financed bankruptcy under management control of Fiat , through the end of 2009.
The No. 3 U.S. automaker had $7.4 billion of cash available at the end of March, up from $5.9 billion at the end of 2009. It also could draw on $2.4 billion of U.S. and Canadian loans if necessary.
This positive operating result in the first quarter is a concrete indication ... that the 2010 targets we have set for ourselves are achievable, Chief Executive Sergio Marchionne said in a statement.
We are also generating cash to finance the investments being made in our product portfolio and brand repositioning, Marchionne said.
Chrysler expects negative cash flow of $1 billion for the full year. It expects to at least break even on an operating basis in 2010.
The first full accounting of Chrysler's financial performance as a leaner company came as its Italian partner Fiat introduced its first strategic plan since its marriage to Chrysler.
Chrysler's financial results come two weeks after bigger rival General Motors Co reported a $4.3 billion net loss from its own emergence from a government-supported bankruptcy in July through the end of 2009.
The losses for Chrysler and GM stand in contrast to Ford Motor Co , which posted a 2009 profit that surprised analysts. Ford expects a 2010 profit and a solid profit next year after avoiding the bankruptcies that snared its rivals.
Analysts expect Ford to report a first-quarter profit when it releases results on Tuesday. GM expects to report its first quarter results in mid May.
The 85-year-old Chrysler was down to its last dollars before some $14 billion in U.S. taxpayer funding last year that gave the U.S. Treasury a 8 percent equity stake in the restructured company.
Fiat acquired an initial 20 percent stake in Chrysler and operational control in return for providing Chrysler with its fuel-efficient technology and platforms. Fiat's stake can increase to 35 percent as it meets restructuring goals.
(Reporting by Soyoung Kim and David Bailey; Editing by Lisa Von Ahn and Derek Caney)