By on April 21, 2010

Increasing signs that reports of the death of luxury cars are greatly exaggerated are emerging from Sindelfingen. To the joy of Daimler stockholders, and to the amazement of pundits who predicted we’ll be driving scooters, Daimler nearly doubled its profit guidance. According to the new reckoning, between €2.5 and €3b should appear below the bottom line as EBIT (earnings before interest and taxes) by the end of this year, says Daimler according to Das Autohaus. That came as quite a surprise.

A few days before, on Wednesday last week, to be exact, Dr. Z. projected €1.5b at the annual stockholders meeting. Which didn’t make stockholder too happy. Some demanded Zetsche’s head. Dr. Z had to make daring predictions, like Daimler’s sales will grow twice as fast as the industry average. After the meeting, his bean counters went back to their books and found more money. Projected money.

The positive prediction is based on “very good results of Mercedes-Benz-Cars,” says Daimler. “These are caused by high sales, a strong model mix, good pricing power, in addition to a favorable cost structure“ says the Daimler statement, obviously penned by someone who usually authors spreadsheets.

Daimler is not alone with the positive outlook for the expensive segment. Most makers of upper class conveyances report the return of customers which they already had written off as dead. Fashionable prudence can be nice. Until the old spending habits recur.

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7 Comments on “Luxury Cars: “We’re baaack!”...”

  • avatar

    Daimler Deathwatch. Daimler Deathwatch. Daimler Deathwatch. Daimler Deathwatch. Daimler Deathwatch. Daimler Deathwatch. Daimler Deathwatch. When is it coming? Can you rehire Farago as a writer only?

    • 0 avatar

      That would be a long death watch, Daimler is a conglomerate just as GM once was, if selling Hughes, EDS, GMAC and EM bought GM 15 years or so, how long could Daimler put it off selling off thier non-automotive related assets.

    • 0 avatar

      If they are doing so well why report EBIT?
      Smoke and Mirrors.

    • 0 avatar

      What? Why do report EBIT when your doing well? Because it’s how you let people know your doing well. Smoke and Mirror’s would be reporting Operating Income when EBIT is negative (exchange losses, one time charges and such, i.e. GM had an operating profit in ’89 (I believe) but after having to recognize long term health-care obligations EBIT was (-) by billions and billions.

    • 0 avatar

      rnc So DB making rosy projections turns into a GM bash. Whatever?

  • avatar
    Steven Lang

    Daimler is in absolutely no danger at this point. The lineup in North America is a very poor representation of their true breadth of vehicles, and industries.

    I would be very interested in an insider’s view of the company (former and current). Out of all the companies we’ve discussed, Daimler has perhaps been the least investigated.

    And yes… I truly love most of their older cars from the 1950’s to mid-1990’s.

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