Fiat Chrysler Automobiles (FCAU.N) beat first-quarter profit forecasts on Tuesday, helped by a strong performance in North America, but higher debt pushed its shares lower.

FCA, which spun off luxury unit Ferrari at the start of this year, said its net industrial debt rose to €6.6-billion ($7.4-billion U.S.) at the end of March from €5.1-billion three months earlier, boosted by seasonal and currency effects.

Chief Executive Sergio Marchionne has vowed to wipe out debt by 2018 but investors are worried about product delays and headwinds in Brazil, once a key market for the group.

The world’s seventh-largest car maker said adjusted operating profit for January-March nearly doubled to €1.38-billion, above analysts’ average estimate of 1.17 billion in a Thomson Reuters poll. Sales rose 3 per cent to €26.57-billion, missing expectations.

“The higher debt seems to be the main negative ... and the question remains whether the profits can be replicated in future,” a Milan-based trader said.

At 1205 GMT, FCA shares in Milan were down 0.1 per cent at 7.225 euros, having traded as low as 6.95 euros.

North America accounted for nearly 90 per cent of FCA’s quarterly profit, reflecting robust demand for its Jeep sport– utility vehicles (SUVs) and pickup trucks. The company also returned to profit in Latin America.

FCA is retooling two of its plants in the United States to boost production of the more profitable SUVs and trucks, improve its model line-up and strengthen its finances before the U.S. car market comes off its peak.

The car maker has already made strides in narrowing the North American margin gap with larger rivals GM and Ford. Profit margins in the region rose to 7.2 per cent in the quarter from 3.7 per cent last year, compared with 8.7 per cent for GM, but investors wonder if that momentum can be sustained.

A year ago, Marchionne urged deals to reduce the number of players in the global auto sector to sustain the heavy capital investments needed to meet demands for cleaner, hi-tech cars.

But his pitch to tie-up with preferred target GM was repeatedly spurned, and other car makers have since said they are not interested in a merger.

FCA’s shares have lost a quarter of their value since Marchionne made the pitch, weighed down by one of the industry’s weakest balance sheets and concerns its U.S. exposure could become a disadvantage once that market turns.