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Daimler logs shrinking sales and profits

October 25, 2018

German carmaker Daimler has reported a significant drop in bottom-line profit for the third quarter. It attributed the result to a number of one-off effects, including the introduction of a new emissions test cycle.

Mercedes S-Class production in Sindelfingen, Germany
Image: picture-alliance/dpa

Daimler announced Thursday the group's net earnings between July and September amounted to €1.76 billion ($2 billion), marking a 21-percent fall in bottom-line profit year on year.

The DAX-listed company said its operating profit (earnings before interest and tax, Ebit) would most likely drop by 10 percent for the whole year, following a 2017 operating profit of €14.3 billion.

Daimler said the full-year decline would come "because of government proceedings and measures in various regions," in what was a statement amounting to the firm's second profit warning in four months.

Trade tensions impacting Daimler

Third-quarter revenues came in at €40.2 billion, just 1 percent below the level reached in the same period a year earlier.

Mercedes car sales shrank by 6 percent to some 560,000 vehicles globally as the carmaker kept seeing itself in a challenging environment, as CEO Dieter Zetsche pointed out Thursday.

The company mentioned current difficulties with regard to higher import tariffs in the wake of an escalated US-China trade conflict.

It also cited additional costs stemming from recalls of diesel cars that did not match current emissions standards. The carmaker added that another problem causing partial delays had been the introduction of a new and more time-consuming emissions test cycle, WLTP, for new models.

German carmakers look to growing Chinese market

hg/jd (Reuters, dpa)