Fiat return to profit

Italian car manufacturer Fiat has returned to profit for the first time since 2008, as it prepares to spin off its non-car assets in 2011.

The group recorded a 113m euros ($145m; £95m) profit for the second quarter, against a 179m euros loss a year ago.

The encouraging result was driven by a turnaround at its car components division, which saw revenues jump 35%.

Fiat, which also produces tractors and trucks, plans to split into separate car and non-car businesses in January.

The results were well ahead of market expectations, and Fiat’s share price jumped 6.5% on the Milan stock exchange.

The company also said it had raised its target for full-year profits.

Net revenues for the quarter rose 12.5% on a year earlier, to 14.8bn euros.

However, this still remains well below pre-recession levels. Two years ago, revenues were 17bn euros.

The bulk of the Fiat Group’s business is done by its carmaking division, which saw net revenues rise 7% to 7.9bn euros.

That included a big jump at Maserati – one of its two luxury car lines along with Ferrari – where net revenues were up 57% to 174m euros.

However, despite the increased business, the carmaker still suffered from falling market share, down to 7.5% from 9% in Europe, and down to 30.3% from 34.4% in its home market Italy.

Source: BBC Business News