Expatica countries
Index Last Var.(%)
BEL 20 3083.51 0.32
DAX 9605.08 0.17
IBEX 30 10058.5 -1.04
CAC 40 4387.61 -0.20
FTSE 100 6806.86 -0.05
AEX 397.5 -0.20
DJIA 16272.65 0.46
Nasdaq 4318.933 0.63
FTSE MIB 20298.33 -0.11
TSX Composite 14214.35 0.18
ASX 5415.4 -0.10
Hang seng 22836.96 0.04
Straits Times 3110.78 0.45
ISEQ 20 836.3 0.23
EUR / USD 1.37976 0.67
EUR / GBP 0.82571 0.59
USD / GBP 0.598544 -0.10
Gold 1329.6 -0.13
Oil 108.9 -0.76
Silver 21.28 0.08
You are here: Home News German News Daimler plans 2 bn euros in cost cuts after profits drop
Enlarge font Decrease font Text size

25/10/2012Daimler plans 2 bn euros in cost cuts after profits drop

German automaker Daimler, which cut its full-year forecasts after a difficult third quarter, is planning to save 2.0 billion euros ($2.6 billion) in costs by 2014, its finance chief said Thursday.

In order to safeguard the profitability of its Mercedes-Benz Cars division -- which groups together its Mercedes-Benz and Smart brands -- Daimler has drawn up a new cost-cutting programme with the aim of overtaking rivals BMW and Audi as the leading top-of-the-range carmaker by 2020.

"We're aiming to achieve a 2.0-billion-euro improvement in costs by 2014," finance chief Bodo Uebber told a telephone news conference.

At the same time, Daimler would extend its model range, with 10 new models planned by 2015, Uebber continued.

Late Wednesday, Daimler revised downwards its 2012 operating profit target after posting an annualised 11-percent drop in third quarter net profit.

The Stuttgart-based luxury automaker said in a statement that net profit for the three months from July through September had fallen to 1.21 billion euros and that it now expected to earn an underlying or operating profit of around eight billion euros this year.

It had previously forecast a level of around 8.8 billion euros.

Analysts surveyed by Dow Jones Newswires had expected a drop of 12 percent.

"Because of the challenges linked to economic developments, Daimler will not reach last year's EBIT (earnings before interest and taxes) but results will nevertheless be good," Daimler chief Dieter Zetsche said in the statement.

The group revised its forecast downward because of the worsening market situation and increased competition, it added.

In the auto sector, Daimler aims at earnings before interest and taxes (EBIT) of 4.4 billion euros.

"Under market conditions which have definitely become more difficult, Daimler achieved a good result in the third quarter," Zetsche said.

In the third quarter, group sales rose eight percent to 28.6 billion euros, while EBIT shrank two percent to 1.9 billion.

© 2012 AFP

0 reactions to this article

0 reactions to this article

Discussion Forums

Community Noticeboard Germany

English Comedy in Berlin

Personal Finance in Germany

Weekly currency crunch

Americans in Germany

Buy German Biometric Passports,Driving License

Community Noticeboard Germany

Buy German Passports,Driving

Humour in Germany

Buy Both Real And High Quality passports, DL, ID cards

participate in the forums

Inside Expatica
The ABCs of the German school system

The ABCs of the German school system

What you need to know about German schools and daycare.

German immigration and residency regulations

German immigration and residency regulations

Want to move to Germany but haven’t figured out the details? Check out Expatica’s overview of the German permit system.

Driving in Berlin: Rules, habits and fines

Driving in Berlin: Rules, habits and fines

In part one of our two part series, we cover the driving culture in Berlin, where to park and buy gas and, most importantly, the laws.

Looking for work in Germany: The in depth version

Looking for work in Germany: The in depth version

Our comprehensive guide includes information on how to find work, recruitment agencies, employment contracts and labour law.