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Why Fiat Chrysler Automobiles' Profit Soared in 2016

A chart summarizing FCA's 2017 guidance.

Italian-American automaker Fiat Chrysler Automobiles NV (NYSE: FCAU) said on Jan. 26 that it earned a net profit of 1.8 billion euros ($1.9 billion) in 2016, up from just 93 million euros ($100 million) in 2015, on increasing profit margins in North America and Europe driven by strong SUV and truck sales.

In the fourth quarter of 2016, FCA earned 1.5 billion euros ($1.7 billion) before interest and taxes, up 1% from a year ago. Its fourth-quarter revenue also rose 1%, to 29.7 billion euros ($31.9 billion). Net income of 409 million euros ($438 million) was roughly double its year-ago result.

A chart summarizing FCA's 2017 guidance.

Image source: Fiat Chrysler Automobiles NV.

Those gains, the company said, will be driven by higher truck and SUV production capacity (and thus sales volumes, hopefully) in North America, the continued expansion of the Jeep, Alfa Romeo, and Maserati brands, and lower interest charges as it pays down debt. The company hopes to achieve investment-grade credit metrics by the end of 2017, and to reduce its net industrial debt to zero sometime in 2018.

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John Rosevear has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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