Daimler Profit Plummets
With rising costs of investing in areas like electrification and autonomy, and a van division that’s struggling, Daimler announced a sharp fall in profit for 2019, down from almost $NZ13billion to $NZ4.7billion.
Company head, Ola Källenius, said the firm will institute cost-cutting measures that meant ongoing investment in electrified technology would not be impacted.
Daimler sold almost as many vehicles in 2019 as 2018, (3.34 vs 3.35 million) and overall revenue was even up slightly. But legal and other expenses hit the bottom line, as did problems with the van division which recorded a substantial loss.
Daimler has been investing heavily in electrification, connectivity and autonomy and that would continue to future-proof the company, according to Källenius. He added that the future of the group relies on “CO2-neutral mobility” and “consistent digitisation".
Mercedes’ first EV, the EQC, has so far been a sales disappointment in Germany, even if it is competitive on many fronts. Investments into new technologies, including electrification, will continue. Källenius said “We are determined to materialise our technological leadership and at the same time to significantly improve profitability.”
Cost-cutting measures will include job shedding. The Daimler Group employs almost 300,000 people globally, and around 15,000 roles are said to be under threat. The firm said that it would cut jobs “in a socially responsible manner”, which included reducing management positions.”