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North America sales lift Chrysler to profit

Chrysler's almost total reliance on North America used to be a huge weakness, one that sent the company into bankruptcy. Now it's a major strength.

Chrysler's almost total reliance on North America used to be a huge weakness, one that sent the company into bankruptcy.

Now it's a major strength. The region is generating profits for the company while losses in Europe and slowing sales in South America and China are drains on other carmakers.

Chrysler, which sells almost 90 per cent of its cars and trucks in the U.S. and Canada, made a $436 million profit in the second quarter. It was a huge turnaround from a year earlier, when the company lost $370 million, mainly because it refinanced government bailout loans.

The automaker, now majority owned by Italy's Fiat SpA, also backed an earlier profit forecast of about $1.5 billion for the year. Such a performance would have been unthinkable three years ago, when Chrysler nearly ran out of cash and needed a government bailout to survive.

Chrysler has emerged from bankruptcy protection with far lower costs, and it's saved money by using Fiat parts and expertise to engineer new models.

Sales of Jeep Grand Cherokee rose almost 40 per cent in the first half of the year.