Chrysler earnings take 24.4% dive

HIGHLAND PARK, Mich. - (AP) Chrysler Corp. said yesterday itsfirst-quarter earnings fell 24.4 percent from a year ago, a dropChairman Lee Iacocca blamed on buyer incentives and lost production.

In the first three months of 1987, the No. 3 domestic automakerearned $269.7 million, or $1.24 per share, down from $356.9 million,or $1.57 a share, in the first quarter of 1986. Revenues totaled$6.12 billion, up 4.3 percent from $5.87 billion a year ago.

"We spent nearly $600 million for plant modernization andupscale products in the first quarter," Iacocca said. "By pouring alot of money back into our car and truck businesses, we're assuringthe future competitiveness and profitability of Chrysler."

Iacocca said Chrysler also spent heavily to "match ourcompetition, or go them one better," in offering extended warrantiesand other buyer incentives.

Chrysler's first-quarter sales were up nearly 4 percent overlast year to $6.03 billion from $5.8 billion. The automaker said itsold 570,002 cars and trucks, 2.4 percent from 556,771 a year ago."Increased sales and market share show our ability to compete,"Iacocca said.

Industry leader General Motors Corp. last week reported a 23.1percent drop in its first quarter earnings from the same period of1986. Ford is expected to release its results this week.