Daimler’s earnings for the second quarter exceeded expectations

Daimler AG outperformed its pre-quarter earnings as the price power of Mercedes-Benz luxury cars outpaced lower production volumes due to global chip shortages.

Interest and tax pre-tax profits rose to 5.198 billion euros ($ 6.14 billion) earlier in the last three months, the German-based manufacturer Stuttgart said in a statement on Thursday, with Bloomberg exceeding an estimate of 3.91 billion euros.

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Daimler has cited strong sales and strong prices for its vehicles, which have offset the negative impact of restrictions on factory production due to a long shortage of semiconductors. As a result of fewer chips, the company preferred larger vehicles that were more profitable than smaller ones that suffered from production disruptions.

(Read also | Daimler, Volvo and Traton to set up $ 593 million truck loading project)

“Despite the low availability of semiconductors that has had a negative impact on our production and sales in the secondary quarter, we continue to deliver good economic performance in all sectors,” CEO Ola Källenius said in a statement.

Photograph of the file used for representational purposes
Photograph of the file used for representational purposes (REUTERS)

The automaker predicted in April that the main Mercedes-Benz unit would be more profitable than it had been in years, thanks to a recovery in demand for cars and trucks in the midst of the global pandemic.

The world’s largest manufacturer of luxury vehicles expects annual sales of 12.8% based on car and Vans division sales, an analyst estimate of 11.5% and a consensus showing historically. The operation of the car has been left out of double-digit margins every year since Daimler sold Chrysler in 2007.

(Read also | Daimler India opens first virtual reality center in Chennai factory)

One year after the worst crisis in the car industry in decades, German carmaker premium businesses have returned to record levels, driven by hot demand from their largest market (China). Profit recovery will be key to funding investments in electrification and software development as the industry moves to more technologically advanced battery-powered vehicles.

Mercedes has renewed its expansion of electric cars this year with its new EQS sedan, a battery-powered sibling from its S-Class, while traditional manufacturers are launching an attack on Tesla Inc. The company will make eight fully electric cars on three continents. Next year.

Daimler is preparing to leave its expanded truck department this year. The company hopes the move will help it better cope with divergent technologies. Trends in the passenger car and commercial vehicle industry.

The full quarterly results will be released on July 21st.

This story was published from a wire agency feed without any changes to the text.

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