Chrysler shares slide 3% after ‘very strong’ Q2 results
Chrysler’s market share fell slightly in the third quarter, according to the company’s latest results.
Chrysler’s overall sales fell 9% in the quarter, from a year ago, and the automaker said it expects to spend $2.2 billion to $2,800 billion in capital spending in 2017, the biggest year-over-year increase since the first quarter of 2014.
Chrysler shares fell 3% to $19.94 in morning trading.
“This quarter’s results showed us that Chrysler’s product lineup remains strong and our financial strength continues to be evident in our capital spending plans,” Chief Financial Officer Joe Hinrichs said in a statement.
“We are also continuing to invest in our product lineups, including the new Jeep Wrangler.”
The automaker reported a profit of $1.25 billion on $937 million in revenue for the third fiscal quarter, down from $2 billion a year earlier.
In 2017, Chrysler is spending $1 billion to invest $2 trillion in the U.S. and Canada, and Hinrich said the company expects to add more capital spending to the current capital budget by the end of 2021.
The company also expects to expand its plant in Chattanooga, Tennessee, which will add 1,500 jobs over the next five years.
Chrysler is a member of the North American Free Trade Agreement, which President Donald Trump has said would lead to higher prices for American workers.
The automakers annual financial report is due Tuesday.
“The economic situation has improved significantly in recent years, but we are still very far from full employment,” Hinrich’s statement said.
“While we continue to see robust demand for our products, we also continue to expect that demand will slow in coming years.
We have to continue to invest aggressively in our business and our products to sustain our growth and to provide our customers with the best possible quality and value.”
Chrysler also said its stock is trading below the $18 price target.
“There is a significant amount of uncertainty in the financial markets surrounding the outlook for Chrysler and the UAW,” Hinriches statement said, “but we remain confident in our ability to manage this uncertainty and we will continue to maintain our aggressive focus on our core product and services businesses.”
Shares of Chrysler, which have dropped since the start of the year, rose 4% to nearly $19 in afternoon trading.
Chrysler, a global auto parts maker, has been trying to improve its image after it was revealed in 2016 that it was the subject of a government investigation that found it had misled workers on safety issues in the construction of its Dodge Durango pickup truck.