Automobile corporation - Mercedes-Benz makes clear reversals
Mercedes-Benz has detected weaker surroundings for the automobile industry. The sales revenue decreased by nearly 4% in the second quarter compared to the previous year, amounting to 36.7 billion Euro, as the Stuttgart carmaker announced. The earnings before interest and taxes (Ebit) fell by almost a fifth to around 4.1 billion Euro. The net income dropped by roughly 16% to 3.1 billion Euro.
The profit margin before interest and taxes, which represents the profit share in sales for the automotive business, stood at 10.2% from April to June - a decrease of more than three percentage points compared to the strong previous year. Sales of particularly profitable top models as well as overall sales decreased in comparison to the previous year's second quarter, even in the important Chinese market.
Analysts had calculated slightly more profit. Mercedes-Benz CEO Ola Källenius lowered the profit forecast for the automotive division to the lower end of the range. However, the situation is better than expected for the commercial vehicles.
The company's forecasts for the total sales revenue and the result before interest and taxes for the year remain unchanged. "We assume that the sales and model mix will improve in the second half of the year - supported by further market launches, particularly in the premium segment," Källenius is quoted as saying.
- Despite the decrease in sales revenue and earnings for Mercedes-Benz in Q2, the company's forecasts for the annual total sales revenue and result before interest and taxes remain unchanged.
- Mercede-Benz's sales revenue in Germany, one of its key automobile branches, also showed a decrease, contributing to the overall decline in the automobile industry.
- The decrease in earnings before interest and taxes (Ebit) for Mercedes-Benz in Q2 was attributed to a drop in sales of high-profit top models and overall sales, affecting even the important Chinese market.
- In light of the weaker surroundings in the automobile industry, Mercedes-Benz, headquartered in Stuttgart, Germany, and a significant player in the Baden-Württemberg automobile industry, had to adjust its profit forecasts for the automotive division.
- The drop in sales and profitability for Mercedes-Benz in Q2 can be seen as a reflection of the overall decline in the automobile industry, affecting various automobile branches worldwide.
