Chrysler's first-quarter profits dip, expenses for new models rise

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Joseph C. Cassini drives his 1934 Packard 1108 Twelve Dietrich Convertible Victoria onto the winners platform after being awarded the Best of Show award at the Pebble Beach Concours d’Elegance. (Bob Chamberlin / Los Angeles Times)

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Ben Rehm, 20, of Carmel photographs a 1927 Rolls-Royce Phantom I Murphy Convertible Saloon at the Concours d’Elegance on Sunday. (Bob Chamberlin / Los Angeles Times)

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Mitzy from Salinas takes a moment to rest in the shade of a 1955 Lincoln Indianapolis Boano coupe. (Bob Chamberlin / Los Angeles Times)

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A Duesenberg with a tool kit mounted inside the driver’s door is displayed at the Concours d’Elegance. (Bob Chamberlin / Los Angeles Times)

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Photographer Phillippe Carre takes a picture of a vintage Alfa Romeo. (Bob Chamberlin / Los Angeles Times)

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Julia Binke, 6, walks in front of a 1925 Rolls-Royce Silver Ghost at the Concours d’Elegance on Sunday. (Bob Chamberlin / Los Angeles Times)

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Sporting racing-flag toenail polish, Lori TenEyck of Colorado was one of nearly 10,000 people enjoying the display of about 200 collector cars at the Concours d’Elegance. (Bob Chamberlin / Los Angeles Times)

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One of the nearly 200 collector cars greets the dawn as it rolls onto the 18th fairway at Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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Chewing on his cigar, Rick Rawlins drives a 1908 Prince Henry Benz, owned by Ann Bothwell but originally owned by race car driver Barney Oldfield, as nearly 200 collector cars greet the dawn as they roll onto the 18th fairway at Pebble Beach to begin the Pebble Beach Concours d’Elegance. (Bob Chamberlin / Los Angeles Times)

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Spectators line up to see the nearly 200 collector cars at the Pebble Beach Concours d’Elegance. (Bob Chamberlin / Los Angeles Times)

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A rumble-seat passenger in a 1933 V-12 Packard at the Pebble Beach Concours d’Elegance. (Bob Chamberlin / Los Angeles Times)

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Wearing a variety of hats, contestants ride in their Rolls Royce. (Bob Chamberlin / Los Angeles Times)

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Adele Tanaka, left, and Jo Yuan capture the moment as the first of nearly 200 collector cars greets the day to begin the Pebble Beach Concours d’Elegance. (Bob Chamberlin / Los Angeles Times)

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A 1957 Ferrari 250 GT 14-Louver Berlinetta is on display at the Gooding & Co. auction as part of the Concours d’Elegance weekend at Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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A prospective buyer looks down a line of cars up for auction at the Concours d’Elegance weekend at Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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A Shelby 289 Cobra Competition Roadster from 1964 is reflected in the fender skirt of a 1937 Bugatti Type 57SC Atalante at the Concours d’Elegance weekend at Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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At the Concours d’Elegance weekend at Pebble Beach, a 1925 Bugatti Type 35 Grand Prix is on display. (Bob Chamberlin / Los Angeles Times)

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A 1935 Avions Voisin C25 Aerodyne, featuring an early version of a sun roof, is on display at the Concours d’Elegance weekend at Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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Sports Car magazine photographer Dave Tomaro photographs prospective buyers as they spend the afternoon ogling vintage and rare automobiles on display at the Concours d’Elegance weekend at Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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A Bentley radiator ornament at the Gooding & Company auction tent at the Concours d’Elegance weekend at Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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A man uses a camera to get a closer look at the undercarriage of a 1956 Porsche 356 A 1500 GS Carrera Coupe. (Bob Chamberlin / Los Angeles Times)

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Expensive cars are lined up at the Concours d’Elegance weekend at Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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A racing rim signed by Carroll Shelby, the father of the Cobra, in Lynn Park’s garage. (Bob Chamberlin / Los Angeles Times)

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“If one’s good, two’s got to be better,” Park said of the cars, chuckling. (Bob Chamberlin / Los Angeles Times)

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Park stands beside the second Cobra he ever bought. One of his sons is going to race in it. (Bob Chamberlin / Los Angeles Times)

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Park checks the hoses of a Cobra he will take to Pebble Beach. This particular car is worth about $2 million. (Bob Chamberlin / Los Angeles Times)

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Park opens the garage door in front of one of the Cobras he plans to take to Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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Lynn Park with his garage full of Cobra cars. Known in classic car circles as Mr. Cobra, Park has been collecting the marque since he bought his first after getting out of the Army in 1969. The first purchase got him hooked. (Bob Chamberlin / Los Angeles Times)

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Lynn Park keeps his Cobras in his garage in La Cañada Flintridge. He and his sons plan to race race three of them at the Pebble Beach, Calif., event. (Bob Chamberlin / Los Angeles Times)

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“You can’t have any more fun than playing with old cars,” Park said of vintage racing. (Brian van der Brug / Los Angeles Times)

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Lynn Park drives one of his vintage Shelby Cobras around his neighborhood in La Cañada Flintridge. (Brian van der Brug / Los Angeles Times)

By Jerry Hirsch

April 29, 2013 7:41 AM PT

Chrysler Group said Monday that its first-quarter profit fell 65% to $166 million.

The automaker’s earnings were hurt by higher expenses to launch new models and slower business in Europe and South America. Revenue fell 6% to $15.4 billion compared with the same quarter a year earlier.

Chrysler attributed much of the decline to the cost and the slow launch of “key” products, including new models of its Ram pickup trucks and the 2014 Jeep Grand Cherokee. It also invested heavily in the second-quarter production launch of an all-new Jeep Cherokee.

The automaker said that the expenses will “position the company for a strong performance in the second half of 2013.”

Chrysler also noted that the first-quarter results marked its seventh consecutive quarter of positive net income.

“We remain on track to achieve our business targets, even as the first-quarter results were affected by an aggressive product launch schedule,” said Sergio Marchionne, chief executive of Chrysler and Fiat, the Italian automaker.

Fiat owns 58.5% of Chrysler, acquired through a series of agreements that started with the Detroit automaker’s bankruptcy restructuring and federal government bailout in 2009.

Marchionne has said Fiat expects to acquire the remaining shares of Chrysler, currently owned by a United Autoworkers Union trust. The two sides are in litigation in Delaware over the price Fiat must pay for Chrysler’s remaining shares.

Meanwhile, Turin, Italy-based Fiat said Monday that had a first-quarter loss of 83 million euros ($108 million.)

Fiat has been hurt by the economic slump in Europe, especially in Italy and its other major markets.

European new car sales fell 10% during the first quarter of this year to 2.9 million, compared with 3.3 million a year earlier, the European automakers association ACEA reported earlier this month. Automakers have now seen European sales fall for 18 consecutive months.

Without the earnings contribution from Chrysler and the healthy North American auto market, Fiat’s financial performance would have been worse, analysts said.

“Who would’ve guessed five years ago when Fiat rode to the rescue of a then-bankrupt Chrysler that Chrysler would be viewed as the savior of Fiat?” said Jack Nerad, analyst at auto information company Kelley Blue Book. “But that’s exactly how the tables have turned.”

Last week, Ford Motor Co. said its first-quarter profit rose more than 15%, helped by record earnings in North America and a strong performance by its auto financing arm.

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