Chrysler Group LLC reported a first-quarter 2011 net profit. In 2010 the company's EBITDA margin was 9.5% (including our adjustments) with positive free operating cash flow (FOCF).We believe that, as a gradual market recovery continues in North America, Chrysler's automotive operations will generate at least upper-single-digit EBITDA margins and some positive operating cash flow in 2011. We expect the company to be more than 50% owned by Fiat SpA (BB/Negative/B) by the end of 2011. We view Chrysler as strategically important to Fiat, but even Fiat ownership of over 50% would not represent a large cash investment by Fiat. We are assigning our 'B+' corporate credit rating and stable outlook to Chrysler, and 'BB' and 'B' ratings respectively, to the
