Strong sales from the Chrysler Group helped propel DaimlerChrysler AG to a big improvement in earnings for the second quarter, the German company said yesterday.

DaimlerChrysler reported profit of $675 million on sales of $45.2 billion in the quarter, up from $133 million on sales of $41.2 billion in the second quarter last year, based on current exchange rates.

The company's financial services arm did well, as did its commercial vehicles business, while the Mercedes Car Group showed weak results and the company's stake in Mitsubishi Motors Corp. was a drag on profit. Worldwide vehicle sales were 1.3 million, up 10 percent from the second quarter last year.

The company's U.S. arm, the Chrysler Group, benefited from several new products that sold well during the quarter, such as the Chrysler 300C sedan, the Dodge Magnum wagon and the Dodge Durango sport utility. Worldwide sales were 781,400 vehicles, up 8 percent from the second quarter of 2003.

Chrysler's operating profit was $628 million, up from a loss of $1.2 billion. Yesterday's result marked the fourth straight quarterly profit for Chrysler.

Vehicle sales at Mercedes were essentially the same as in last year's second quarter, at 319,400 units. That total included a slight decline in sales in the United States and Europe, but an increase in China. Mercedes operating profit fell to $856 million for the quarter, from $1 billion. The company blamed the drop on slower sales, the cost of launching new models and a continued effort to improve quality, the perception of which has eroded in recent consumer surveys after years of good ratings.

DaimlerChrysler's stake in the stumbling Mitsubishi of Japan cost the company $600 million in the quarter. But DaimlerChrysler, which in April pulled out of a financial bailout of Mitsubishi, said its share of the company had declined from 37 percent to 25 percent and will not affect earnings in the future because it will count as a simple investment.

Those negative numbers were offset by results at DaimlerChrysler's services sector, where profit before interest and taxes jumped to $575 million, up 41 percent. New car loans helped drive the increase, with the number of customers up 19 percent.

Unit sales at DaimlerChrysler's commercial vehicles division -- which produces Mercedes-Benz, Freightliner and Sterling trucks as well as Thomas Built buses -- rose 47 percent in the quarter, to 184,900. The sales pushed operating profit to $570 million, up from $270 million in the second quarter last year.

The company avoided a labor strike in Germany earlier this month, and reached an employment pact there that could cut labor costs by as much as $609 million a year beginning in 2006. Projecting that Mercedes sales will rebound and Chrysler will stay strong, the company said in a news release it "expects to achieve a significant improvement in operating profit for the full year."

Chrysler Group's Dodge Magnum is among the hot-selling cars that helped parent DaimlerChrysler earn $675 million in the second quarter.