Fiat ahead despite difficult Europe market Fiat reported higher 2011 and fourth-quarter profits and said its earnings would rise further this year, despite what it described as difficult trading conditions in Europe. The Italian company's results were lifted by profits at its US Chrysler subsidiary and strong sales in Brazil, and were in line with most analysts" expectations and better than its own previous guidance. IN Automobiles Full-year net profit, which includes earnings from Chrysler, was €1.65bn ($2.17bn), compared with the €222m net profit it reported in 2010. Net unusual income related to Fiat's acquisition of the US carmaker added €1bn to its 2011 net income. Stripped of this, Fiat's profit was €684m, against €342m in 2010. The group reported a fourth-quarter net profit of €265m, compared with the €153m it reported the previous year. Fiat is one of Europe's carmakers most challenged by the current economic slowdown because of its strong presence in Italy's declining car market and focus on small cars, where all manufacturers are having to discount in order to compete. Registrations of Fiat cars fell by 17 per cent in Europe last year in an overall market that declined by 1.7 per cent, according to the European carmakers" group Acea. However, Fiat has in recent quarters seen its earnings lifted by Chrysler, which is profiting from a resurgent US car market, and in Brazil, where Fiat is the top-selling car brand, ahead of Volkswagen and General Motors. Fiat said it sold 772,700 cars and light trucks in Brazil last year, 1.5 per cent more than in 2010 and an annual record. The company maintained its number one spot on the market last year but said it faced an "increasingly competitive market." Chrysler reported net income of $183m for all of 2011, compared with a net loss of $652m it reported in 2010. Its fourth-quarter net income was $225m, the US carmaker's best quarter since it emerged from bankruptcy under Fiat's control in June 2009. Chrysler's annual result included a $551m loss relating to its repayment of outstanding loans to the US and Canadian governments last year. Excluding this charge, net income was $734m for the year, better than its previous guidance. Fiat took an initial 20 per cent stake in Chrysler and now owns 58.5 per cent of its US subsidiary. A healthcare trust managed on behalf of Chrysler's unions owns the remaining 41.5 per cent. "The house is in good order," Sergio Marchionne, Fiat and Chrysler's chief executive, said in a statement. We are proud of the work we've done. Chrysler said it aimed to earn net income of about $1.5bn this year and would generate free cash of at least $1bn. Its 2012 earnings guidance forecast a jump in net revenue to about $65bn, from $55bn in 2011. Fiat said it expected its earnings before interest and tax to reach €3.8bn to €4.5bn this year, and its net debt would rise to between €5.5bn and €6bn, from €5.5bn at the end of the fourth quarter. The guidance came in light of what the company described as "the level of uncertainty regarding economic activity in the eurozone in the near term."