Despite Europe's economic woes, Fiat was able to reduce its fourth-quarter operating loss in the region to 165 million euros from a 289 million euro loss in the last quarter of 2011.
The company's full-year operating loss in Europe was 738 million euros, which is an improvement over 2011 when the company lost 879 million euros. The company previously reported only a 2011 trading loss of 502 million euros.
Fiat defines trading profit as operating profit before unusual items.
Fiat-Chrysler expects to marginally improve profitability this year, forecasting a trading profit of 4 billion to 4.5 billion euros, up from 3.8 billion last year.
Fiat owns 58.5 percent of Chrysler Group, which since last year is fully consolidated in the Italian automaker's results.
Fiat expects the U.S. market to grow this year to about 15.5 million units from 14.8 million in 2012, while it sees sales in the European Union plus Iceland, Norway and Switzerland being flat at 12.5 million.
Financial analysts at Morgan Stanley in London expect U.S. sales this year to grow to 16 million, but they also see western European sales falling for a sixth straight year. The 2013 decrease is forecast to be 4 percent to 12.7 million light vehicles from 13.2 million in 2012.