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Chrysler Suffers $13-Million Loss : Autos: It blames higher-than-expected costs for new-vehicle introductions and a slow industry recovery from recession.

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From Associated Press

Chrysler Corp. reported a $13-million first-quarter loss Thursday, blaming higher-than-expected costs for new-vehicle introductions and the auto industry’s slow recovery from recession.

But without including one-time charges and credits, Chrysler lost $256 million, or 76 cents a share, in the January-March period.

Chrysler’s results contrasted with those of Ford Motor Co. and General Motors Corp., which reported earlier this week that they earned a combined $517 million in the quarter, the first profit for either auto maker since 1990.

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GM and Ford surprised analysts with their resilience against a sluggish car market. Chrysler was not expected to show a profit, but Wall Street underestimated the size of the No. 3 auto maker’s loss.

Chrysler’s shortfall equaled 7 cents a share and compared to a loss of $598 million, or $2.66 a share, a year earlier, when the company had a one-time $257-million charge from an accounting change.

Revenue rose 40% in the most recent quarter to $8.19 billion, from $5.85 billion a year earlier.

“We said when we reported our 1991 year-end numbers that the first-quarter operating loss would be worse than our fourth-quarter results,” Chrysler Chairman Lee A. Iacocca said. “The industry is starting to show some signs of recovery, but it’s not coming back as fast as we’d like.”

That is especially true in car sales, where the industry rate has not improved since October. Without any new vehicles to entice customers, Chrysler’s market share in the quarter fell 1.2% to 8%.

However, light truck sales have begun to improve. Chrysler dominates the minivan segment, gaining 1.5% to 21.5% of the market.

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A bright spot in the quarter was that Chrysler, like GM and Ford, had a more profitable mix of vehicles, reducing its sales of wholesale fleet cars and increasing its retail sales to individuals.

“As the retail buyer comes back, you don’t appear to increase the sales but profit certainly does benefit,” said Joseph G. Paul, an auto industry analyst with Sanford C. Bernstein & Co. in New York.

Chrysler spent more than expected in the quarter to get new vehicles, such as the Jeep Grand Cherokee sport utility vehicle, ready for sale.

But analysts, who say those new products are key to Chrysler’s survival, were forgiving about the added costs.

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