TURIN, Italy — The Italian industrial giant Fiat said this week that net profit for last year nearly doubled to 664 million euros ($607 million) from 353 million euros in 1999. Operating profit at the key auto unit beat market predictions.
The company, which in addition to its flagship brand produces Alfa Romeo cars, said it will focus this year on significantly reducing debt and aim to increase profitability, which should become evident in the second half of the year.
"The year 2001 will constitute a solid basis for the acceleration of profitability," Fiat said.
Also this week, Fiat appointed veteran U.S. financial and political figure Felix Rohatyn to its board.
Rohatyn has served as U.S. ambassador to France and as a member of the New York Stock Exchange. He was also a senior partner in Lazard Freres and Company in New York.
"The entry of Felix Rohatyn assures the board the advantage of someone profoundly knowledgeable about the world of international economy and finance," Fiat said in a statement.
For all of 2000, Fiat Auto had an operating profit of 44 million euros ($40 million) compared with a 1999 loss of 121 million euros ($110.6 million). The 2000 operating result exceeded analysts expectations, some of whom had foreseen a loss.
"Fiat Auto had in 2000 the first signs of improvement and worked towards the recovery of structural profitability, supported by the industrial accord with General Motors," Fiat said in a statement.
The company attributed the improvement to better profitability at its Brazil operations, the success of the Punto and the Lancia Lybra models, and, above all, to cost savings achieved despite higher material costs.