Minivans, Jeeps Boost Chrysler Earnings 6.6%

DETROIT â€”  Sales of minivans and Jeeps helped Chrysler Corp.’s second-quarter revenues climb 8.2% and earnings rise 6.6% despite a general weakness in the auto market, the company said today.

The results contrasted with declines in second-quarter earnings reported last week by General Motors Corp. and Ford Motor Co.

“Although the market is soft right now, we believe Chrysler is in excellent position to fight for market share. Our minivans and Jeep vehicles are the best on the market,� said Chairman Lee A. Iacocca.

But industry analysts have said the No. 3 auto maker still has significant problems selling cars profitably. Last week Iacocca moved dramatically to save $1 billion in costs by year’s end by deeply cutting his white-collar work force.

Chrysler said it earned $341 million, or $1.46 a share, for the three months ended June 30, compared with $320 million, or $1.45 a share, in the second quarter of 1988.

Jeep Cherokee sales were up 19% compared with last year’s second quarter, the company said.

In a sign of Chrysler’s problems selling cars, Iacocca said buyer incentive costs rose 20% in the second quarter over the same period a year ago.

Costs of incentives were cited in last week’s reports of a 3.4% decline in earnings at GM and a 15.4% drop at Ford.

Each of the Big Three has spent hundreds of dollars per vehicle on incentives during the second quarter to try to boost sales and shrink inventories in the face of softening auto and truck markets.