Daimler Sees Positive Earnings by Year's End, Reliance on Big Glitz

Mercedes-Benz parent company Daimler reported its second-quarter earnings Thursday, revealing a net loss of nearly 2 billion euros and a revenue drop of more than 12 billion euros. Thanks, coronavirus.

While the red ink spilling from Daimler’s balance sheet is cause for concern, the automaker put on a happy face, regarding this year’s financial blows as mere setbacks. The company expects pre-tax earnings to return to the positive side of the scale by the end of the year. To help grow future profits, the Mercedes-Benz brand plans to turn its focus to the toniest of products.

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Amid Losses, Daimler Rethinks North American-made Sedans

Domestic automakers have largely rid their North American facilities of sedans, so why shouldn’t foreign manufacturers? That’s what Mercedes-Benz parent Daimler plans to do after announcing a second-quarter loss of $1.9 billion.

While the quarterly loss was less than analysts expected, financial and sales pressures brought on by the coronavirus pandemic has led the automaker to cull car production on this side of the pond.

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Best-laid Plans, and All That: Daimler Cuts Likely to Continue

Daimler plans to turn up the volume on cost-cutting measures due to operating losses in the second quarter that haven’t officially manifested. CEO Ola Källenius believes the damage caused by the pandemic response will be too severe to proceed with business as usual for the rest of 2020. At the company’s annual meeting, held Wednesday, the CEO told shareholders to anticipate additional measures to protect profits.

“Our previous efficiency goals covered the upcoming transformation, but not a global recession. That’s why we are further sharpening our course,” Källenius said, noting that the company is currently in talks with labor representatives. Considering the automaker enacted a plan bent on reducing its workforce by at least 10,000 to save an estimated €1.4 billion ($1.6 billion) by 2022, we doubt those discussions are super cordial.

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Mercedes-Benz Gives Up Trying to Hide the New S-Class

With the next S-Class leaking more than a screen door on a submarine, Mercedes-Benz seems to have given up trying to obfuscate its design.

With its freshly un-camouflaged sedan having been shared less than a month ago, the German automaker dropped a teaser image that effectively confirms the leak was the real deal.

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EV Offensive Looking More and More Like a Decoy Attack

Mercedes-Benz is nixing its all-electric EQ hatchback, according to R&D boss Markus Schäfer. Instead, it’s going to play a GLA-sized EQA crossover as its next hand.

Speaking with Autocar, Schäfer basically said it was a question of market demand. The EQC has already been delayed until at least 2021 for U.S. customers, though we’ve heard talk that its suspension could prove indefinite as the brand reassesses what should — and shouldn’t — be included in its future lineup. “We have to watch customer demand and, at the moment, SUVs and crossovers are the absolute favorites. Those are our first priorities,” Mercedes’ R&D head explained.

It’s only the latest chapter in a complicated story about an industry that’s constantly having to rethink how it handles electric cars.

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Volkswagen and Daimler to Merkel: Spiff Our Rides

Amid steep drops in operating profit and a dismal sales outlook, both Volkswagen and Mercedes-Benz parent Daimler are appealing to the state in a bid to generate sales demand.

Both automakers appealed to the German government for assistance on Wednesday, Reuters reports, ahead of a meeting of auto industry leaders. With vehicle production making up a big part of Germany’s GDP, the shutdowns enacted to slow the spread of COVID-19 has left the sector hurting. That pain is expected to last through 2020.

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European Ford, Toyota, BMW Plants Go Dark

The European marketplace is shutting down, and with it the manufacturing base of many automakers. Ford, Toyota, and BMW have now announced temporary suspensions of production at plants across the continent — a measure that’s starting to be seen in North America.

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Daimler CEO: 'Streamlining the Portfolio' Necessary for Mercedes-Benz

Still in the midst of a $1.4-billion restructuring plan that aims to cut 10 percent of its workforce, Mercedes-Benz is reconsidering what its product lineup should look like moving ahead. While most of the doomed models will be chosen due to lackluster demand (e.g. X-Class pickup) plenty will be nixed as a result of tightening emission laws. Mercedes parent Daimler issued two profit warnings in 2019 after the luxury brand was fined $960 million in an emissions-cheating settlement. Like many automakers, it was also hemorrhaging cash through its investments in electrification.

An apt analogy for the automotive industry’s stampede toward EVs would be lemmings hurling themselves off a seaside cliff — but not because of the popular misconception that the critters are intentionally committing mass suicide. When lemmings collectively off themselves, it’s the result of migratory behavior gone awry. They simply bunch up and move in a singular direction, largely unaware of the consequences.

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German Automakers Look to South America for Keystone Lithium Supply

With Europe increasingly fixated on regulating vehicular emissions, German automakers are throwing themselves into electrification like ’90s moms did with Beanie Babies. As with those moms, the investment has yet to pay off. Still, that hasn’t encouraged anyone to change course. Every player understood from the outset that transitioning to EVs was bound to be costly and, with increasingly stringent regulations proposed every month, there aren’t many alternatives.

Volkswagen placed its very existence on electrification after Dieselgate, quickly running into problems with battery suppliers. And while VW claims it’s solved the issue for the next few years, it isn’t out of the woods yet. VW and Daimler have reportedly commissioned a study into sustainable lithium mining in Chile, but it’s already receiving pushback from environmental groups concerned about the delicate nature of the region’s Atacama salt flat — where the metal is found in abundance.

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Record Sales, Lackluster Earnings As Mercedes-Benz Shoves Cash Into Evs

Mercedes-Benz sold a record 2,385,400 passenger vehicles around the globe in 2019, topping the previous year’s tally by some 3,400 units, and subsequently brought in more money while doing it. Revenue rose 3 percent, the automaker said in its end-of-year earnings report, but that intake didn’t translate into more profit.

Far from it.

As the automaker embarks on a cost-cutting campaign aimed at freeing up cash for electric vehicle development, among other things, the German manufacturer announced its net profit dropped to $2.95 billion from $8.29 billion in 2018. As a result, shareholders can expect a paltry dividend payout.

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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.

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Daimler Investors Seeking 900 Million in Diesel Damages

Over 200 investors are seeking 900 million euros in damages over claims that Mercedes-Benz parent Daimler failed to disclose the use of emissions cheating devices similar to those that got Volkswagen into trouble back in 2015. This isn’t the first time the issue has come up. German prosecutors claimed nearly 690,000 Mercedes-Benz vehicles came equipped with rigged exhaust gas after-treatment systems and Daimler was slammed with a €870 million ($960 million) fine over the negligent violation of European clean air standards in the fall.

Those who invested into the firm are hoping to recoup losses from the scandal after the automaker’s share price shat the bed. Lawyers repressing the investors are seeking compensation after Daimler’s stock fell from €90 a share fall to approximately €60 in 2018, once German regulators began formally accusing the automaker of trying to circumvent emission rules.

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Mercedes to Pay $13 Million U.S. Regulatory Fine As NHTSA Keeps Watch

Mercedes Benz will pay a $13 million penalty to U.S. safety regulators over a failure to report a string of necessary recalls. A signed settlement on file with the National Highway Traffic Safety Administration (NHTSA) indicates that Daimler’s American arm could be on the hook for up to $20 million in regulatory fines.

The remaining $7 million is in the hands of the NHTSA, which has to eventually decide whether or not Mercedes expedited its recall notices or improved upon its recall processes. The automaker will be audited by the regulatory agency until 2022 to help make those assessments.

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Mercedes-AMG Delivers 'Emotion Start' for the Intentionally Inconsiderate

Everyone has had that one neighbor with an impressively loud car that shook you out of bed every time they booted it up. Even if you absolutely loved their ride, you might not have appreciated it frightening you at sunrise. Fortunately, automakers have begun implementing features like Ford’s “ Good Neighbor Mode,” to make this less of a problem on their more-raucous products. The Germans have had a similar idea, but they’re implementing it backwards.

Rather than having a way to select/schedule the times you want your loud vehicle to run quiet, Mercedes-AMG has all of its models automatically kicking over with the exhaust flaps closed. If you want their signature burble you have to select it using a loudness button typically located on the central console after startup — or activate the new “Emotion Start” feature.

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Report: China's BAIC Wants to Increase Daimler Stake

A new report indicates that BAIC Motor Corp, Daimler’s primary Chinese joint-venture partner, wants to increase its stake in the company. Currently, BAIC owns 5 percent of the German automaker ( purchased in July) with rumors swirling in October that the firm wanted to increase its investment. There were also claims that Geely was attempting to stand in the way of the prospective deal.

While not Daimler’s main squeeze in Asia from a production perspective, Geely actually owns 9.7 percent of the company — giving it quite a bit of leverage. As such, there were murmurings that Geely put the kibosh on any ideas BAIC had on investing further. Geely has rebuffed the accusation. “We are a long-term investor in Daimler. We do not react spontaneously to any volatility and we support Daimler’s management and their strategy,” the firm explained.

Be that as it may, there appears to be a minor power struggle between the two Chinese companies. Both seem interested in strengthening their influence and happen to find themselves in each other’s way.

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  • Fred As a British Car Fan I liked them, but then I sat in one and changed my mind. I like the unique looks of the newer ones.
  • FreedMike Not much to look at, but these were sweet to drive.
  • EBFlex Ford finally making a good decision although they should shut down their EV operations and investment all together. Why lose that money too?
  • Mike Lol. This is the king of suvs. And its made by GM.Why is everyone trashing it?Top of its its class for a quarter century.
  • Frank Drove past there last week, plant has a huge poster of a bronco on the outside. I was thinking "Is that where they build the new broncos?" I know they use to make the Edge and that other mundane SUV there but I believe both have been canned.