2024 Author: Eric Donovan | [email protected]. Last modified: 2023-12-16 21:13
This is not how the new Daimler boss had imagined his start: Ola Källenius starts his start at the top with red numbers. The group is under pressure.
Ailing markets around the world and start-up difficulties with new models are currently affecting the Stuttgart-based group as well as various expensive long-term problems - not only with diesel. The result is a billion-dollar loss in the second quarter, for which Daimler presented the figures on Wednesday. With a turnaround in the second half of the year, things should be turned around. "We want to turn the tide," said Källenius, especially with a view to the core business with Mercedes-Benz cars.
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"The figures are anything but satisfactory," admitted Källenius. For the Swede it is the first quarterly balance sheet since he started two months ago. For the period from April to the end of June, Daimler posted a loss of 1.3 billion euros to the shareholders. Before the so-called withdrawal of minorities, it is 1.2 billion. In the second quarter of the previous year, the bottom line was a profit of 1.7 billion euros.
Sales increase by 5 percent
Sales increased by five percent to around 42.7 billion euros, which was mainly due to the good business with trucks and buses and not the core business with cars. Analogous to sales, this also resulted in a slight minus here.
It was already foreseeable that Källenius' start quarter would be anything but good. The new CEO had already cashed in on the goals set by his predecessor Dieter Zetsche at the beginning of the year and corrected them downwards twice. After a significant slump last year, profit should now go further down in 2019. In the coming months, the group now expects a “noticeable improvement”.
"Our results in the second quarter were mainly influenced by special items amounting to 4.2 billion euros," emphasized Källenius. What he means are, among other things, provisions for proceedings in connection with the diesel scandal. Daimler has to recall hundreds of thousands of cars because the authorities believe that they contain an inadmissible control of emissions control.
Forced recall a month ago
Another forced recall was added just a month ago, and the authorities are still investigating other models. Apart from criminal investigations against individual employees, there is also a so-called administrative offense procedure that could end with a high fine.
And then it is still unclear what financial consequences the manipulation allegations will have in the USA. However, Källenius and his CFO Harald Wilhelm did not want to say on Wednesday which new findings have prompted Daimler to put significantly more money aside.
Also recalled because of airbags
An expanded Takata airbag recall adds another $ 1 billion to provisions. In addition, Daimler is writing off around 500 million euros as part of a “prioritization of the product portfolio” in the van sector. Källenius did not want to say whether this was the result of the quick end of the X-Class pick-ups, which were only introduced in 2017, as is often assumed.
Källenius now wants to streamline everything even more, make it more efficient and possibly also lend a hand on the model range. However, it remains to be seen exactly where to save. The only thing that is clear is that there should be no active downsizing. The group had actually announced that it would return to a return on sales of eight to ten percent in the passenger car division by 2021. That this is the long-term goal, Källenius confirmed on Wednesday. He left it open whether it would stay at 2021. Details shouldn't be available until autumn - then in a complete package.
The main task until then is to solve the problem with the lack of vehicle availability, emphasized the CEO. Daimler is not getting the new models of its popular SUVs on the market fast enough. But there are already positive signals. The second half of the year has only just begun. "And we are determined to use it," emphasized Källenius. (dpa)
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