DETROIT (AP) — In just three years, Chrysler has gone from government ward to rising star.
The No. 3 U.S. automaker made $1.7 billion last year thanks to big gains for its much-improved cars and trucks, and it's expecting profits to reach $2.2 billion this year.
It's a big improvement over 2011, when Chrysler earned $138 million. And it's even more remarkable considering that Chrysler was in bankruptcy and living on taxpayer loans just three years ago.
The improving U.S. economy is one reason for Chrysler's success. Auto sales in the U.S. — where Chrysler sells three out of every four of its vehicles — rose to a five-year high of 14.5 million last year. They could climb to 15.5 million or more this year, most industry analysts say.
But Chrysler rose even faster than average, with its U.S. sales up 21 percent versus 13 percent for the industry. That's because new or recently revamped products like the Dodge Dart small car, Ram pickup and Jeep Grand Cherokee are putting Chrysler back on buyers' shopping lists after years of quality concerns and flagging demand. Sales of the Chrysler 300 sedan nearly doubled in 2012; so did sales of the tiny Fiat 500.
Chrysler also made more on every car it sold. Customers paid an average of $29,630 for a Chrysler vehicle last year, up about $1,000 from the year before, according to auto pricing site TrueCar.com.
Revenue increased 20 percent to $65.8 billion last year. Chrysler expects higher revenue of between $72 billion and $75 billion this year.
Fueling the growth is a revived truck market that should see some upswing as home construction improves. The company's Ram pickup is a strong contender in that segment, says IHS automotive analyst Mike Wall. Sales could also get a boost this year from updated versions of popular products like the the Jeep Grand Cherokee, Fiat 500 and Jeep Liberty.
It helps that Chrysler has limited exposure to Europe, where falling sales have hurt its competitors, Wall says. Ford announced Tuesday that it expects to lose $2 billion in Europe this year on top of a $1.75 billion loss in that region in 2012.
But Chrysler's limited international sales are also a frustration for CEO Sergio Marchionne, who has led Chrysler and its majority owner, Italian automaker Fiat SpA, since Chrysler emerged from bankruptcy in 2009. Chrysler and Fiat recently signed a deal with Chinese automaker Guangzhou to build Jeeps for Chinese buyers, and Marchionne wants to start production quickly.
"I'm tired of waiting in China," he said in a conference call with analysts and media. "Jeep may be our way back into that market."