Home / Motor/ Daimler hurt by production delays at Mercedes, China slowdown

Daimler hurt by production delays at Mercedes, China slowdown


Comments / {{hitsCtrl.values.hits}} Views / Monday, 29 April 2019 00:00

Facebook

FRANKFURT, REUTERS: Daimler’s first-quarter operating profit fell 16%on Friday as a 718 million euro ($800 million) one-off gain failed to offset raw material costs, technology investments and production delays at three Mercedes-Benz factories. 

Sales of Mercedes-Benz cars fell 7%in the first quarter in part due to manufacturing bottlenecks for the A-Class compact car in Aguascalientes, Mexico, the Mercedes-Benz Van in Charleston, South Carolina, and the Mercedes-Benz GLE sports utility vehicle in Tuscaloosa, Alabama. 

Mercedes-Benz sales in China, the world’s largest car market, fell 3%and plans to make a Mercedes-Benz pickup truck in Argentina have been abandoned after a management review, the carmaker said. 

“We cannot and will not be satisfied with this, as expected, moderate start to the year. We now have to work hard to achieve our targets for 2019,” Chief Executive Dieter Zetsche said in a statement to accompany his final quarterly results as boss. 

Daimler blamed new suppliers for problems launching a sports utility vehicle platform, causing production delays for a new high-margin GLE model and the return on sales at Mercedes-Benz cars to fall to 6.1 percent, down from 9%a year earlier. “Daimler is blaming supplier bottlenecks and quality issues pretty much across all divisions for its poor financial performance. To be clear: it’s management’s job to manage its supply chain and relationships with partners,” Evercore ISI analyst Arndt Ellinghorst said in a note on Friday. 

Earnings before interest and tax (EBIT) fell to 2.80 billion euros, below the 2.89 billion expected by analysts despite a 718 million euros valuation boost from the merger of the mobility services divisions of Daimler and BMW. 

 


Share This Article

Facebook Twitter


DISCLAIMER:

1. All comments will be moderated by the Daily FT Web Editor.

2. Comments that are abusive, obscene, incendiary, defamatory or irrelevant will not be published.

3. We may remove hyperlinks within comments.

4. Kindly use a genuine email ID and provide your name.

5. Spamming the comments section under different user names may result in being blacklisted.

COMMENTS

Today's Columnists

A case for reviewing plantation management

Thursday, 23 May 2019

Last week, I elaborated on ‘Going Beyond Agronomic Research for Plantation Reform’ with the aim of beginning a conversation on the importance of non-agronomic research to understand the many problematic areas that plague the plantation sector, in


How are we doing in e-government?

Thursday, 23 May 2019

It is customary to assess some aspect of the performance of a country using a composite index such as the Ease of Doing Business Index or the Network Readiness Index. For government services, there is the e-Government Development Index (EGDI), issued


National introspection in the aftermath

Thursday, 23 May 2019

“The immediate task for the Government is to guaranty the safety and security of all innocent Muslims and prevent a recurrence of 1983 … One cannot eradicate one evil with another” – Anatomy of an Islamist Infamy (III), CT, 9 May. In this, th


AI + BI + CI x DI = Empowering, enriching and impacting society and environmental wellbeing

Thursday, 23 May 2019

There has never been a time like today where many are raising concerns for society’s wellbeing, survival and thriving, despite many progressive advancements in the digitally transformed world. We are already in the so-called Fourth Industrial Revo


Columnists More