Daimler and VW want to revive the COVID-19 affected car industry

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Daimler and VW have called on German authorities to introduce incentives to revive the car industry, after the COVID-19 crisis led to lower sales and profits in the first quarter.

Germany is preparing a car summit in which the authorities and the most important players in the industry will discuss measures to revitalize this sector, in the context of the coronavirus pandemic.

Companies such as Daimler and Volkswagen have already asked Germany to find ways to bring demand and sales back to normal.

“We need a quick decision on incentives for buyers,” said VW chief financial officer, while the head of Daimler said that “a simple incentive would be effective.”

Daimler pre-released preliminary results, showing a plunge of nearly 70% in first-quarter operating profit while preliminary first-quarter earnings before interest and tax slumped 78% to 617 million euros, following disruptions caused by the coronavirus pandemic. Volkswagen also expects “disturbances” in the second quarter, after its sales fell by 23% in the first three months and profit fell by 81%.

Car companies and analysts estimate that global production will fall by at least 20% this year.