TORONTO (AP) -- Chrysler Group LLC is considering a public stock offering sometime in 2011, the automaker's new CEO says.
Sergio Marchionne, who also heads Italy's Fiat Group SpA, said Thursday there is enough demand in the marketplace to support initial public offerings for Chrysler and General Motors Co., both of which were restructured in government-funded bankruptcy protection cases last year.
He also said Chrysler struggled through a painful restructuring last year, and he never wants to see the company lose money again.
"I expect 2010 will be a much better year than we originally forecast," he said, predicting that U.S. vehicle sales to top 11 million this year and 12 million in 2011.
"Those are good volumes to try and build a car business on," he told reporters before a business speech in Toronto.
Sales slumped to 10.4 million last year, the worst in more than a quarter century.
Chrysler would have been sold off in pieces in late 2008 or early 2009 if the U.S. government had not stepped in with billions in aid. The government put Marchionne in charge of turning around the Auburn Hills, Michigan, automaker and gave Fiat a 20 percent stake in the company.
That can grow to 35 percent if it meets targets set by the U.S. Treasury. The remainder of the company is now 68 percent owned by a United Auto Workers retiree health care trust, 10 percent by the U.S. government and just over 2 percent by the Canadian government.
In its most recent quarter, Chrysler slashed its net loss to $197 million on cost cuts, manufacturing efficiency and more disciplined pricing. That was far less than the staggering $3.8 billion the company lost from the time it left bankruptcy protection June 10 through the end of last year. Marchionne said Chrysler's turnaround plans are starting to work.
The U.S. government said Monday that Chrysler repaid $1.9 billion of a $4 billion loan, which was extended before the company filed for Chapter 11.
Chrysler came close to running out of money at the end of 2008, so the U.S. government stepped in, authorizing $15.5 billion in aid and appointing Fiat to run the new company after emerged from bankruptcy protection. An Old Chrysler company, made up mainly of debt and unprofitable assets, was left behind.
Treasury said it has received repayments of $3.9 billion to date, including the $1.9 billion repayment and a $1.5 billion loan paid off by Chrysler Financial. The new post-bankruptcy Chrysler also assumed $500 million of Old Chrysler's debt, reducing the debt to the government.
Chrysler on Friday plans to celebrate the start of factory production of the Jeep Grand Cherokee, a totally new version of the venerable sport utility vehicle. The model is more efficient than the old one, behaving more like a car than a truck on suburban highways. Yet it still has off-road capability, the company said. The new vehicle is being built at a Detroit factory.
GM, which posted net income of $865 million for the first quarter earlier this week, has hinted at a public stock offering late this year, although its executives have said recently they'll do it when the company and markets are ready.
GM has repaid $6.7 billion of the roughly $50 billion it received in federal aid. The government, which owns 61 percent of the automaker, hopes to get at least part of the remaining $43 billion back through the stock sale.
