Daimler: Here Come the Savings, There Go the Jobs
In November, Daimler announced a restructuring plan that called for the elimination of 10,000 jobs, claiming the effort would result in an estimated 1.4 billion euros ($1.5 billion) in savings by the end of 2022. Chairman Ola Källenius may just be getting warmed up.
According to German outlet Handelsblatt, sources within the company claim austerity measures will be expanded at Tuesday’s investor conference. Källenius is said to raise the job cut figure to 15,000 while scaling back (or dropping) several side businesses that aren’t turning a profit. As well, the automaker will likely axe a few models that don’t fit in with the core brand’s luxury image, starting with the Nissan Navara Mercedes-Benz X-Class.
More details will arrive after tomorrow’s meeting, though Handelsblatt says to expect a cancellation of successors for the S-Class’ convertible and coupe variants. Meanwhile, the AMG CLS and GT will reportedly be “merged” into an singular electric performance coupe. Surely that won’t leave AMG fans in an uproar, especially not after the GT had its best sales year on record (by a huge margin) in 2019…
Most of the job cuts are expected to come by way of early retirement and juiced-up severance packages; however, there should also be programs to help some employees transition into part-time work. The number is less important than the savings, however. Daimler just wants to see how much higher it can push the €1.4 billion restructuring target.
As for side projects on the chopping block, the German paper only referenced the Lab1886 innovation center. The site is responsible for various mobility projects, or at least their inception. But most are profit-losing mobility programs, data management software, connected services and the like. Daimler is currently looking to offload its shares. We’ll see what other ugly growths Källenius wants to see shaved off the company’s back on Tuesday.
[Image: Daimler]
A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.
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Build quality vehicles and customers will come. Everyone knows to never own a German car out-of-warranty. If Daimler could change that perception, they could sell every car they make. And, no, electrification is not going to save them.
I don't know how they're not selling enough cars. Hooterville here has a very high Negro population and you can't look in any direction without seeing a Mercedes.