AUBURN HILLS, Mich. -

Insisting that “our job is not yet done,” because the company still posted a net loss for the year, Chrysler Group chief executive officer Sergio Marchionne highlighted the positive strides the automaker made in the fourth quarter and all of 2010 in terms of net revenue and modified operating profit.

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The company shared its preliminary financial results Monday, indicating its fourth-quarter net loss was $199 million. For the year, Chrysler’s net loss totaled $652 million.

Executives arrived at these amounts by first noting their fourth quarter net revenues decreased 2.3 percent to $10.76 billion as compared to third quarter. They said the drop primarily was due to reduced shipment volumes as Chrysler launched production of 11 new vehicles.

Chrysler determined its total year net revenues came in at $41.94 billion, a figure it believed to be in line with full-year guidance.

As a result, the company revealed a modified operating profit of $198 million in the fourth quarter and $763 million for the total year. Chrysler thinks the fourth quarter operating performance was driven primarily by improved mix and pricing. The OEM added industrial efficiencies and improved quality — more than offset by lower volumes — increased advertising investment and higher launch costs.

“As Chrysler Group’s brand displays at the Detroit auto show confirmed, the company has lived up to its promise to launch 16 all-new or significantly refreshed vehicles in the past 12 months,” Marchionne declared.

“All of these vehicles bear testimony to Chrysler’s rebirth,” he continued. “Given the positive comments we have received to date, it can safely be said that what Chrysler delivered last year, on both the product and financial fronts, surpassed many expectations.

“However, our job is not yet done. We have a lot of work ahead to fulfill our five-year business plan objectives,” Marchionne added.

Continuing on with Chrysler’s financial details, the company calculated that fourth-quarter modified EBITDA settled at $882 million or 8.2 percent of net revenues. The amount represented a $55-million decrease from the previous quarter.

Chrysler’s total-year modified EBITDA was $3.461 billion or 8.3 percent of net revenues.

Elsewhere, the automaker determined its fourth-quarter net interest expense was $329 million, including non-cash interest accretion of $57 million. For the full year, its net interest expense was $1.228 billion, including non-cash interest accretion of $229 million.

Executives discovered their cash level as of Dec. 31 stood at $7.3 billion compared to $8.3 billion on Sept. 30.

“The decrease primarily reflected anticipated unfavorable working capital impacts at the end of the year due to reduced production volumes as new vehicles were launched,” company officials explained.

“An additional $2.3 billion remains available to be drawn under Chrysler Group’s U.S. Treasury and Canadian and Ontario government loan agreements, bringing total available liquidity above $9.6 billion,” they added.

Furthermore, Chrysler mentioned its free cash flow for the year totaled $1.4 billion, more than $2 billion ahead of its original guidance.

Also included in the financial statements was an update on the automaker’s gross industrial debt level as of Dec. 31, which was $13.1 billion. It marked an increase of $1.1 billion from Sept. 30.

The company explained the rise primarily was due to the issuance of promissory notes — which totaled approximately $1 billion — to an independent health care trust in connection with transferring the responsibility for certain CAW retiree health care benefits from Chrysler to the trust. Officials said the amount was offset by a reduction in accrued expenses and other liabilities.

As a result, the OEM’s net industrial debt increased by $2.0 billion to $5.8 billion during the fourth quarter.

2010 Sales Performance

Chrysler tallied up its worldwide vehicle sales and found the fourth-quarter total of 374,000 units represented a 7-percent decrease from the previous quarter. The automaker moved 27,000 more units in the third quarter for a total of 401,000 units

The company believes the dip was due mainly to reduced fleet volume associated with the new model changeovers in the fourth quarter.

Looking at the total year, Chrysler indicated its worldwide sales totaled 1,516,000 units. Its U.S. market share for the full year was 9.2 percent, versus 8.8 percent in 2009.

Officials added their Canadian market share increased to 13 percent for the year compared to 11 percent in 2009.

In other data, the OEM noted worldwide vehicle shipments in the fourth quarter totaled 382,000 units, a decrease of 6 percent versus the previous quarter. The company’s U.S. vehicle shipments totaled 270,000 units compared to 301,000 units in the prior quarter.

Chrysler computed that its full-year worldwide vehicle shipments came in at 1,602,000 units.

The automaker went on to stress that it maintained a U.S. dealer inventory level consistent with its sales performance. The company made an increase from 231,000 vehicles as of Sept. 30 to 236,000 vehicles as of Dec. 31. The automaker found days supply increased to 63 days from 58 days in the third quarter as it prepared for the marketing launch of new and refreshed products.

Recap of Major Company Events & Accolades

Like its domestic counterpart did last week, Chrysler rattled off a series of achievements that came in 2010 and the early stage of this year:

—On Oct. 29, Mexico President Felipe Calderon and other government officials joined Chrysler executives as Chrysler Mexico confirmed its commitment to the region and country with the inauguration of its sixth manufacturing plant, the new Saltillo Engine Plant in Coahuila, Mexico.  The plant, along with the Trenton, Mich., South Engine Plant, produces the new and advanced Pentastar 3.6-liter V-6 engine.

—Chrysler’s product offensive continued in the fourth quarter with the launch of 11 new or significantly-refreshed vehicles.  For the full year, Chrysler launched 16 all-new or significantly refreshed vehicles. 

—The all-new Jeep Grand Cherokee was named 2011 Urban Truck of the Year by Decisive Media; Four Wheeler editors selected the vehicle as Four Wheeler of the Year and The Detroit News named it Truck of the Year. Additionally, AutoWeek honored the Jeep Grand Cherokee with the Best of the Best/Truck Award and the vehicle was a finalist for North America Truck of the Year at the North American International Auto Show in Detroit along with the 2011 Dodge Durango.

—Four Wheeler also chose the iconic Jeep Wrangler Rubicon the Best 4X4 of the Decade.

—Seven vehicles — the new Chrysler 300, Chrysler 200, Dodge Charger, Dodge Avenger, Dodge Journey, Jeep Grand Cherokee and Jeep Patriot — were named Top Safety Picks for 2011 by the Insurance Institute for Highway Safety. The IIHS annually recognizes vehicles that do the best job of protecting people in front, side, rollover and rear crashes based on a “good” rating in a series of tests conducted by the institute. The 2011 Dodge Avenger and Dodge Journey were selected as Top Safety Picks for the third straight year and the Jeep Patriot for the second year in a row. 

—In December, Ram’s heavy-duty trucks earned the 2010 Motorist Choice Award for the active lifestyle category from IntelliChoice and AutoPacific, and the Ram Heavy Duty earned a 2010 Vehicle Satisfaction Award in the heavy duty pickup category. Off-Road Adventures selected Ram as Manufacturer of the Year and Automobile named the Ram 1500 to its annual list of All-Stars for the second consecutive year. The Ram 1500 remains the most awarded Ram ever.

—As the new year began, Chrysler Group announced that the Chrysler Town & Country minivan was the top-selling minivan in the U.S. for 2010. For the 10th straight year, Polk gave the Town & Country the Automotive Loyalty Award in the minivan category.  Polk also selected the Dodge Challenger for a loyalty award in the sports car category.

—Production of the Fiat 500 began at the Toluca, Mexico Assembly Plant, in the fourth quarter, marking the brand’s return to U.S. and Canada after a 27-year absence. The company has appointed the first 130 of an eventual 165 Fiat dealers in the U.S. and appointed 64 dealers in Canada. Those appointed are in the process of preparing their new facilities for the arrival of the Fiat 500, and will open throughout the first three quarters of this year. The 2012 MY Fiat 500 was revealed at the Los Angeles and Montreal International Auto Shows.

—On Nov. 23, employees at Chrysler’s Indiana Transmission Plant II in Kokomo, Ind., welcomed President Obama and Vice President Biden to celebrate recent and planned investments in the company’s Kokomo facilities, resulting in the retention of more than 3,500 jobs. The company confirmed it will invest $843 million in its Indiana Transmission Plants and Kokomo Casting Plant to accommodate production of a new advanced front-wheel drive automatic transmission for future Chrysler vehicles.

—Chrysler Group and ZF Friedrichshafen of Germany-based ZF Group are partnering on both the 9-speed front-wheel drive and 8-speed rear-wheel drive transmissions. ZF is making its designs and technology available to the company.

—Chrysler welcomed 2011 with an extensive showcase of its full, reinvigorated product lineup from the Chrysler, Jeep, Dodge, Ram and Mopar brands at the North American International Auto Show in Detroit. The company also featured the new Fiat 500. The auto show marked the world premiere of the all-new 2011 Chrysler 300 sedan and introduction of the new, redesigned 2011 Jeep Compass. The company also kicked off the Jeep brand’s 70th anniversary in 2011, marking the occasion with the introduction of distinctive, unique 70th anniversary edition models for each vehicle in its lineup.

—On Jan. 10, Chrysler announced that Fiat’s ownership interest in the company increased from 20 percent to 25 percent upon the company’s achievement of the first of three Class B Events outlined in its operating agreement. This event related to the certification and start of commercial production of the Fully Integrated Robotized Engine (FIRE) at the company’s Dundee, Mich., facility. The engine will be first used in the Fiat 500.

More 2011 Guidance

Chrysler indicated its targets for this year are:

—Net revenues of more than $55 billion.

—Modified operating profit of more than $2.0 billion.

—Modified EBITDA of more than $4.8 billion.

—Net Income of $0.2 to $0.5 billion.

—Positive free cash flow of more than $1.0 billion.

Analysts See Chrysler on Positive Track

Jesse Toprak, vice president of industry trends and insight at TrueCar.com, agreed with Marchionne that Chrysler is still rectifying its situation but making wise choices.

“Chrysler’s (expected) positive cash flow and their ability to post at least a gross operating profit (their net will be a loss due to the cost of government loans) in 2010 indicates that the company has made the right decisions to improve their fundamentals in a rather short period of time,” Toprak surmised.

“The company still faces several obstacles on their way to better financial health, including lowering their heavy reliance on SUVs and trucks, launching a successful Fiat dealership network and paying back the costly government loans,” he continued. “We expect Fiat to end up owning 51 percent of Chrysler and take it public before the end of 2011."

Meanwhile James Bell, executive market analyst for Kelley Blue Book, gave a generally upbeat assessment of Chrysler’s overall performance.

“It’s a situation where the financials are not in perfect shape. They’re not as good as what GM and Ford have been announcing lately, but GM and Ford were not nearly in the same depths of product despair as Chrysler was. They’re seeing a light at the end of that tunnel,” Bell shared with Auto Remarketing.

To explain why Chrysler might not be on par with either of its domestic competitors, Bell rewound to trace the company’s problems.

“It’s clichéd to say but it is so true that product is what leads car companies out of despair. When you look at the line of product investment that the Chrysler company had not experienced and had ignored going back to the Daimler days, it’s no surprise that their product line had become very stagnant and stale going into 2010,” Bell explained. “There was just nothing on the books that was destined for production other than the new Grand Cherokee which is of course is based the current generation Mercedes ML SUV platform. That was the only artifact from Chrysler’s tenure with Daimler-Benz.

“Based on that backdrop, the company Fiat inherited from the U.S. government just had nothing on the product books that was ready to come and save the day,” Bell went on to say. “They have been in a real all-hands-on-deck mode to get the products that they have available today in production shined up and refreshed, have shortcomings addressed and have fuel economy increased. They’ve been brought up to 2011 specs.”

Bell acknowledged that traffic on Kbb.com is picking up not only for the Jeep Grand Cherokee but also for the new version of the Chrysler 300 that was showcased at NAIAS. He sees more positive traction is needed to push up consumer appeal, eventually resulting in stronger sales figures.

“It’s going to take a grassroots experimental sort of thing where people are going to have to go visit a Chrysler dealership and be enchanted by what they see there,” Bell emphasized. “If you’ve been to a Chrysler, Jeep or Dodge store in the last two years or so you saw a lot of products that you saw for the first time back in 2007. There was just not anything new or exciting.

“Go into the same dealership today and you’re going to see a new spirit, a new way of presenting the vehicles and new vehicles themselves,” he insisted.

“It’s going to take that consumer experience to turn that perception gap from Chrysler being seen as left behind the other Detroit manufacturers to actually starting to share pace with them,” Bell added.

He went on to explain, “The real big test is starting with the Fiat 500 small car which will be on sale in the next few months to reintroduce the Fiat brand to the U.S. because there will be several Fiat-based vehicles that will be rebranded as Dodges and Chryslers. They’re going to be much more European in their fuel economy, their size and their driving experience from what you would expect from an American car company.

“While it’s great they’ve shined up their current products and made them appealing to 2011 consumers, it’s the appeal to 2013’s consumers which is where Chrysler’s rolling the big dice and bringing over these European products and rebranding them with American brand names,” Bell concluded.