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Automotive industry: Daimler expects significantly less profit


The automaker made heavy losses in the second quarter. Daimler therefore expects that the operating result this year will be worse than in 2018.

The automaker Daimler has lowered its profit expectations for the second time within a short time. After a billion loss in the second quarter, the Group expects operating earnings before interest and taxes this year well below the previous year, as Daimler announced. Just three weeks ago, the automaker had lowered its expectations to the previous year's level.

Daimler justified the correction with, among other things, additional provisions amounting to 1.6 billion euros to deal with the diesel affair. In addition, around one billion euros have been covered for an extended recall of Takata-Aibags. Also, the growth of the automotive markets is "less than expected".

The loss in the second quarter was 1.6 billion euros. In the same quarter of the previous year, Daimler had achieved a profit of 2.6 billion euros. The division of Mercedes-Benz Vans was particularly affected. He alone recorded a minus of two billion euros.

Share price drops 4.5 percent

In May, the Swede Ola Källenius at Daimler had replaced the longtime CEO Dieter Zetsche. At the end of June, he had also lowered his profit targets for the year due to the emissions scandal. After the renewed profit warning, he now has to fight against a loss of confidence among investors in an already difficult year with the ongoing restructuring of the group. The price of Daimler shares fell by up to 4.5 percent after the correction at the beginning of the stock market.

Källenius is expected to implement Zetsche's stringent austerity measures. Details of the new boss has not yet submitted. Job cuts should not be part of the plans, it was previously out of the company.

Source: zeit

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News/Politics 2019-09-22T02:20:18.689Z

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