Daimler improved its revenues and opeating profit in the third quarter. The German group, which has been suffering from difficult market conditions for some time, mainly benefited from good sales from its subsidiary Mercedes-Benz. Commercial vehicles were also in great demand.
Total revenues in the first nine months of the year increased by 8%, despite the trade war, uncertainty about the Brexit, declining demand in China and other changes in the car market, from 40.2 billion to 43.3 billion euros. Daimler’s also announced the earnings before interest and taxes (EBIT) rose 8% to 2.69 billion euros, compared to 2.49 billion euros in the third quarter of last year. The net profit rose by 3% to €1,813 million (Q3 2018: €1,761 million).
In the third quarter, Mercedes saw sales increase by 8 percent, which translates to 604,700 vehicles compared to 559,500 cars from Q3 2018. The Group’s total unit sales rose by 6% to 839,300 passenger cars and commercial vehicles (Q3 2018: 794,700). That was somewhat at the expense of the profit margin, which shrank from 6.3 percent to 6 percent. This was due to production problems with the Mercedes GLS and because cars were being fitted with costly anti-emissions filters. Daimler already gave a profit alarm twice this year and is working on a plan to improve the results.
The company further lowered its revenue expectation for the truck division. This is partly due to higher costs for new models and innovation, rising raw material prices and negative exchange rate effects. However, the company expected to continue boosting its sales and revenues.
“In order to master the transformation in the next few years, we need to increase our efforts considerably: we have to significantly reduce our costs and consistently strengthen our cash flow,” Chief Executive Ola Kaellenius said.