DDAIF - Daimler AG
Chart Events
Performance Outlook
- Short Term2W - 6W
- Mid Term6W - 9M
- Long Term9M+
| Previous Close | 43.85 |
| Open | 45.23 |
| Bid | 0.00 x 0 |
| Ask | 0.00 x 0 |
| Day's Range | 45.17 - 46.05 |
| 52 Week Range | 22.75 - 60.00 |
| Volume | 25,210 |
| Avg. Volume | 39,746 |
| Market Cap | 49.743B |
| Beta (5Y Monthly) | 1.69 |
| PE Ratio (TTM) | 4.65 |
| EPS (TTM) | 9.87 |
| Earnings Date | N/A |
| Forward Dividend & Yield | 1.02 (2.32%) |
| Ex-Dividend Date | Jul 09, 2020 |
| 1y Target Est | 57.88 |
- Reuters
Russian dealer looks to zero customs tariff to lift Tesla sales
Russia's main unofficial Tesla dealer hopes zero customs fees will lift sales of the U.S. vehicles, despite their relatively high price and a fledgling charging infrastructure. Only 353 new electric cars were sold in Russia last year, including 81 Teslas, data from Autostat shows. While Tesla has not officially entered the Russian market, Tesla Club helps customers, including businessmen and politicians, buy the cars abroad and maintain them.
- Bloomberg
Europe Is Building the Next Tesla. Who Knew?
(Bloomberg Opinion) -- When Nikola Corp. started trading on Nasdaq in June, the Phoenix-based clean transportation company raced quickly to a valuation of almost $30 billion.Its market worth has since fallen to a more reasonable $10.5 billion, but that’s still pretty spicy for a business yet to generate any revenue. Its most promising products are its heavy trucks, powered by electric batteries or hydrogen fuel cells.The rise of Nikola (whose name, cheekily, is another evocation of electrical engineer Nikola Tesla) will have reinforced a view among European auto industry executives that the U.S. stock market operates by different rules. While Tesla Inc. is only modestly profitable, it’s valued at about $275 billion, more than Europe’s five largest carmakers combined.At least Europe has a stake in the latest heavily hyped project. Founded by Trevor Milton, a 38-year-old American college dropout, Nikola is relying heavily on expertise from the old continent. Robert Bosch Gmbh, a German automotive supplier, has helped develop the U.S. company’s electric powertrain, and the first Nikola trucks will be built in a German factory belonging to Italy’s Iveco, a truck maker backed by the billionaire Agnelli family. Bosch and Iveco each own more than 6% of Nikola. CNH Industrial NV, Iveco’s parent, just recorded a $1.5 billion fair value gain on that investment.(1) The biggest question is whether a start-up dependent on so much external help should have a whizzy valuation like Tesla, which builds much of its technology itself. And if Europe has this expertise, why hasn’t it produced its own rival to Elon Musk’s carmaker?Maybe it’s a lack of chutzpah. Nikola’s name isn’t the only reason it’s often compared with Tesla. Milton’s hyperactive Twitter presence makes Musk look tame by comparison. Both men’s ambitions extend beyond selling zero-emission vehicles to producing and storing clean energy. While Nikola is focused on heavy-duty trucks, it has touted a variety of consumer products including a pickup called the Badger. These are catnip for retail investors, as the excitement over Musk’s Cybertruck demonstrates.While Tesla and Nikola are both working on electric heavy trucks, they differ in at least two important respects. The first is hydrogen: Musk is dismissive, while Milton thinks hydrogen is the perfect fuel for long truck journeys. The second is their attitude toward building stuff in-house. True, in its early days Tesla worked with Lotus to help make the Roadster, and Daimler AG helped develop the Model S saloon. Tesla partners with Panasonic to produce battery cells. But Musk is famous for trying to build his own technology, from electric powertrains and automated-driving software to car seats.Nikola developed its own software, infotainment and battery management-system, as well as vehicle aerodynamics, according to Cowen analyst Jeffrey Osborne. It has outsourced or used hired help to do much of the other stuff. More than 200 Bosch employees were involved in building important parts of Nikola’s trucks, including the electric motor for the axle, the vehicle-control unit, the battery and the hydrogen fuel cell. The result is a mix of intellectual property owned either separately or jointly by Nikola and its suppliers. There’s no doubt, however, who has the deeper expertise. So far Nikola has been awarded 11 U.S. patents, about 1% of the total Bosch is awarded in a typical year. “Bosch gets paid to help us get to industry standards on products,” Milton told me.Getting partners to provide the technological building blocks has some advantages. Nikola has only 300 employees and yet its first trucks should start rolling off the production line soon. Working with partners cuts the risk of the manufacturing delays and quality problems that plagued Tesla.It’s an efficient use of capital too. Nikola’s research and development expenses were just $68 million last year. Tesla spent $1.3 billion. After going public, Nikola has about $900 million of cash, although that won’t go far in the automotive business. For the North American market, Nikola plans to handle its own manufacturing, with technical assistance from Iveco. Nikola broke ground this week on a $600 million factory in Arizona.Whether or not you believe the extensive involvement of outside partners should have a bearing on its lofty valuation, there are other things that could upset Nikola’s plans. Building a refueling network is a central part of its business model, but this won’t come cheap at $17 million for each hydrogen station. The company is also entering a competitive field populated by more experienced and better capitalized rivals. Daimler’s Mercedes-Benz failed to follow through on its early experiments with electric cars and let Tesla roar past. It probably won’t make the same mistake with trucks.Daimler is the world’s largest truck maker and it plans to start production of its electric eActros and eCascadia models next year. The German giant has also formed a joint venture with Sweden’s Volvo AB to develop hydrogen fuel cell systems for heavy vehicles. That venture is valued by the companies at just 1.2 billion euros ($1.4 billion), putting the Nikola valuation into perspective. Even if its share price looks overblown, Nikola’s improbable rise shows there’s investor demand for clean transportation companies that don’t still have one foot planted in the combustion-engine past. European manufacturers have the technical chops but they must find better ways to capitalize on investor excitement through new business models or spinoffs. Otherwise someone else will.(1) This was measured on June 30 when Nikola's stock was much higherThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Chris Bryant is a Bloomberg Opinion columnist covering industrial companies. He previously worked for the Financial Times.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Reuters
VW cuts dividend as H1 profits plunge on pandemic sales drop
Volkswagen unveiled a first-half operating loss on Thursday after the carmaker suffered a 27% drop in vehicle deliveries due to the coronavirus pandemic, a step which forced to carmaker to slash its dividend. Volkswagen predicted sales for the full year to significantly fall from 2019 levels, but added that as lockdowns eased, global sales have staged a gradual recovery. The carmaker posted an adjusted operating loss of 800 million euros ($940 million) in the January to June period, down from a 10-billion euro adjusted operating profit in the year-earlier period, and said it will cut its dividend for 2019.
- Reuters
Chile judge calls for water study on 'fragile' lithium-rich Atacama salt flat
A top environmental judge in Chile renewed a call for a government-vetted water study to help stamp out lingering questions about sustainability that have cast a pall over Chile's lithium-rich Salar de Atacama. Water - both fresh and saline, where the lithium lies - has long been a sticking point for miners at Atacama, one of the world's richest reserves of the ultralight battery metal. The flat sits amid the world's driest desert.
- Reuters
GLOBAL MARKETS-World shares retreat on rise in Sino-US tensions
Global shares skidded further from five-month peaks on Friday as a bounce back in European business activity did little to ease the jitters surrounding Sino-U.S. tensions, while gold approached a record high. The mood darkened after Beijing ordered the United States to close its consulate in Chengdu, in retaliation for being told to shut its consulate in Houston earlier this week. "An escalation in U.S.-China tensions that could have hugely negative consequences on stock market leadership, particularly around the US tech giants, is worrying," said Stephen Innes, Chief Global Market Strategist at AxiCorp.
ReutersGLOBAL MARKETS-Gold rallies on U.S.-China row, Apple news slams stocks
The dollar slipped to an almost two-year low and gold rose further on Thursday as a gauge of global equities retreated on concerns about a potential probe of Apple Inc, which knocked the wind out of the high-flying tech sector. Multiple U.S. states are investigating Apple for potentially deceiving consumers, according to a March document obtained by a tech watchdog group. Apple shares fell 4.55% and pulled the Dow, Nasdaq and S&P 500 lower.
- Reuters
GLOBAL MARKETS-Gold rallies anew on latest U.S.-China row, stocks falter
The dollar weakened and gold rose further on Thursday as a gauge of global equities meandered after earlier gains in Europe and Asia as rising cases of COVID-19 crimped the U.S. labor market and deteriorating U.S.-China relations gave investors pause. "There has been a turn in dollar sentiment," said Marc Chandler, chief market strategist at Bannockburn Forex in New York. Better-than-expected earnings in Europe lifted regional shares, with Germany's Daimler AG forecasting a rise in operating profit at its Mercedes-Benz division and Unilever's second-quarter sales falling far less than feared.
- Reuters
GLOBAL MARKETS-Stocks gain as upbeat earnings outweigh U.S.-China tensions
Stock markets rose on Thursday as better-than-expected corporate earnings in Europe offset worries about rising cases of COVID-19 and a sharp escalation in tensions between the United States and China. Shares have rallied to their strongest levels since February this week - in many countries erasing their entire slump in March when the coronavirus pandemic sent markets into freefall - as investors bet that massive stimulus has carried economies through the worst of it. The gains this week are despite Washington's order to Beijing to close its consulate in Houston, Texas amid accusations against China of spying, which initially pulled shares lower in Asia before stocks rebounded.
Reuters VideosEuropean earnings: less horrible than expected
Less gloomy than expected. That’s the story in short on a big day for earnings in Europe. Daimler just one of the big names to cheer investors. The Mercedes-Benz maker says operating profits will rise in 2020 as sales rebound. It says cost-cutting measures have helped counter the impact of this year’s slump in demand. Daimler shares jumped over 6 percent following the relatively sunny outlook. Shares in consumer goods giant Unilever up even more - around 8 percent. That after it said second-quarter sales fell much less than expected. The maker of soaps, spreads and other staples saw sales drop just 0.3 percent, when analysts had forecast a 4.3 percent slide. A pickup in eating at home boosted demand for products like Knorr soups. But advertising giant Publicis trumped both. Shares in the French firm jumped 15 percent after it said sales fell much less than expected. In the second quarter they were down 13%, not the 20% forecast. It was helped by last year’s acquisition of big new clients including Disney and Bank of America. Roche one share to disappoint investors Thursday though. It was down as much as 1.8 percent early on. The Swiss drugmaker saw sales fall almost 10 percent as patients shied away from hospital visits. Overall all though, Thursday's earnings numbers helped drive an up day for European stocks. The regional Stoxx 600 index was up around 0.6 percent in early trade.
- Bloomberg
Daimler Eyes Profit After Weathering Worst of Virus Crisis
(Bloomberg) -- Daimler AG came through the worst of the coronavirus crisis better than feared and sees enough signs of recovery in auto demand to forecast a profit this year.After Tesla Inc. managed to stay profitable even in the midst of a global pandemic, the Mercedes-Benz maker showed traditional carmakers could weather the storm as well.Daimler anticipates earnings before interest and taxes and free cash flow to be positive in 2020, albeit lower than the previous year, the Stuttgart, Germany-based manufacturer said Thursday. The outlook is based on an assumption that the economy continues to rebound and there’s no second wave of the coronavirus.Some of its mass-market peers haven’t fared as well. Ford Motor Co. forecast a second-quarter operating loss of more than $5 billion. Fiat Chrysler Automobiles NV withdrew its guidance in May after a worse-than-expected first-quarter loss, saying it may raise more money. Nissan Motor Co. reported its first loss in a decade because of the virus.With showrooms and factories shut by lockdowns, Daimler suffered an operating loss of 1.68 billion euros ($1.95 billion) in the second quarter, confirming preliminary figures. For the full year, the company expects profit in a low, single-digit billion-euro range, compared with 2019’s 4.3 billion euros.Special items in the second half will be on the same magnitude as the first six months, when the company booked slightly less than 1 billion euros for measures including ceasing production at its former Smart factory in France.Big-Ticket ReboundThe damage from the unprecedented market slump was kept in check thanks to a swift production halt when markets tanked and a recovery fueled by demand for big-ticket vehicles like the Mercedes GLS sport utilirty vehicles and the S-Class Maybach luxury sedan.The company’s results are “another positive data-point for the auto sector as pent-up demand continues to drive retail volumes and pricing,” Angus Tweedie, an analyst at Citigroup, said in a note.Daimler shares rose as much as 6.7% and were up 5.4% at 12:15 p.m. in Frankfurt, paring the decline for the year to 16%.The focus for Daimler shifts to deeper restructuring that already started before the pandemic upended the global economy. The company has boosted its labor-cost savings target to 2 billion euros from 1.4 billion euros, which could put roughly 20,000 jobs at risk, according to people familiar with the matter.Chief Executive Officer Ola Kallenius renewed his pledge to boost efficiency across the organization, targeting everything from fixed costs to labor expenses. The 51-year-old Swede has vowed to make the sprawling manufacturing network more efficient.Restructuring efforts will go beyond what the company mapped out in November last year and will stretch through 2025 instead of the previous plan that ran until 2022, he said, adding that it was too early to provide concrete goals as talks with labor unions aren’t finalized.The world’s biggest luxury-car maker and heavy-truck producer plans to provide an update on its strategy to lower its break-even point later this year.Job RisksThe initial plan had foreseen more than 10,000 job cuts, but Daimler personnel chief Wilfried Porth said this month the company will now have to eliminate more than 15,000 positions to avoid forced layoffs. Manager Magazin on Wednesday reported that the reductions could affect as many as 30,000 jobs.Trimming costs is key to sustaining momentum after Daimler surprisingly generated positive free cash flow in the second quarter, aided by a swift production stop when the virus outbreak spilled over from China to Europe and North America.Prospects for the second half of the year remain shaky because key markets including the U.S. and U.K. have been struggling to contain the pandemic. Daimler said it expects a “considerable decline in global economic output” for the year.Even with damage control in full swing, Daimler vowed to compete with Tesla in electric vehicles and digital gadgetry.Mercedes is preparing to roll out the electric-powered EQA and EQB compacts. It will also flank its flagship S-Class with a purely battery-powered sibling, dubbed EQS. The full-sized sedan will be the first car based on a dedicated electric platform and is part of Daimler’s focus technology investment in the lucrative segment of larger luxury vehicles.“We are committed to our key strategic objectives: to lead in electrification and digitalization,” Kallenius said.(Updates with CEO comments beginning in 12th paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- MarketWatch
European stocks open higher, led by Unilever, Daimler
European stocks opened higher on Thursday after a mixed session in Asia. Unilever shares surged after reporting profit growth in the first half of the year, and Daimler rose after as the loss-making vehicle maker said it's seeing the first signs of recovery from the coronavirus pandemic, especially at Mercedes-Benz passenger cars. U.S. stock futures edged higher after the latest results from Microsoft and Tesla.
- Reuters
Daimler flags recovery signs, sees Mercedes-Benz EBIT rising this year
Daimler on Thursday flagged signs of recovering demand for top-end Mercedes-Benz models and electric vehicles, sending its shares higher. CEO Ola Kaellenius said its Mercedes-Benz cars and vans division appeared set for a rise in 2020 operating profit. "We are now seeing the first signs of a sales recovery especially at Mercedes-Benz passenger cars," Kaellenius told journalists on a call.
- PR Newswire
Daimler reports second-quarter 2020 results
Revenue of €30.2 billion (Q2 2019: €42.7 billion)
- Reuters
Electric bus maker Proterra considers deal to go public -sources
U.S. electric bus manufacturer Proterra Inc is considering going public through a merger with a blank-check company, eschewing the traditional initial public offering that it explored last year, according to people familiar with the matter. Burlingame, California-based Proterra would become the latest electric vehicle maker to merge with a special purpose acquisition company (SPAC), following in the steps of electric-truck startup Nikola Corp and car maker Fisker Inc. SPAC investors are placing bets on which startup might be the next Tesla Inc. Proterra, whose investors include car makers Daimler AG and BMW AG, has not ruled out an IPO or remaining private, the sources said.
- Reuters
How Tesla defined a new era for the global auto industry
Tesla Inc's rapid rise to become the world's most valuable carmaker could mark the start of a new era for the global auto industry, defined by a Silicon Valley approach to software that is overtaking old-school manufacturing know-how. Tesla's ascent took many investors by surprise. Daimler, which bears the name of the man who invented the modern car 134 years ago, bought a nearly 10% Tesla stake in May 2009 in a deal which provided a $50 million lifeline for the struggling start-up.
- Reuters
INSIGHT-How Tesla defined a new era for the global auto industry
Tesla Inc's rapid rise to become the world's most valuable carmaker could mark the start of a new era for the global auto industry, defined by a Silicon Valley approach to software that is overtaking old-school manufacturing know-how. Tesla's ascent took many investors by surprise. Daimler, which bears the name of the man who invented the modern car 134 years ago, bought a nearly 10% Tesla stake in May 2009 in a deal which provided a $50 million lifeline for the struggling start-up.
- Reuters
Bosch creates single unit to oversee software, systems development
Germany’s Robert Bosch GmbH, the world’s largest auto parts supplier, said on Tuesday it is consolidating its software and electronics expertise in a single division, in order to get new digitalized vehicle functions on the road significantly faster. Bosch is the latest large automotive company to shift its emphasis from hardware to software as vehicles continue their transformation into mobile devices that combine transportation with digital services from e-commerce to infotainment — a trend driven heavily by electric car maker Tesla Inc. Starting in early 2021, Bosch will draw together parts of its automotive electronics, chassis and powertrain divisions and combine them with its car multimedia division, with 17,000 employees in more than 20 countries.
- Reuters
Microsoft, Nike, Unilever team up to combat global carbon emissions
Microsoft Corp, Nike Inc , Starbucks Corp, Unilever NV and five other industry titans from various sectors are teaming up to help businesses globally achieve zero carbon emissions. Called "Transform to Net Zero", the group plans to recruit other members and will work with the Environmental Defense Fund and focus on delivering guidance, research and blueprints for businesses to achieve zero carbon emissions no later than 2050. The announcement gave no details of any investment the companies would make, outlining only initial research and other work to be completed over the next five years.
- Bloomberg
Xpeng Raises $500 Million Even as China EV Market Sputters
(Bloomberg) -- Electric-vehicle maker Xpeng Motors raised about $500 million from a group of venture investors, showing Chinese startups with promising car models can attract funding even as the industry’s sales slump.Investors in the Series C+ financing round include Aspex Management, Sequoia Capital China, Hillhouse Capital and Coatue Management, Xpeng said Monday in a statement. The fundraising follows a $400 million round in November.Xpeng is increasing its chances of staying a viable contender in the world’s largest electric-car market, where it competes with sales leader Tesla Inc., local peers such as NIO Inc. and such global rivals as BMW AG and Mercedes-Benz maker Daimler AG. Though industry sales have been sputtering since the government scaled back subsidies last year, the market is in its early stages.Other aspiring EV makers, such as Byton Ltd., have run into funding problems and wound down operations this year amid the market slump, which was exacerbated by the coronavirus pandemic. Sales of new-energy vehicles, including electric cars, fell 35% to 85,600 units last month, according to the China Passenger Car Association.Meanwhile, competition is getting tougher, with the number of new Tesla registrations rising to a record last month and BMW and Mercedes bringing out EV models.Xpeng delivered 5,185 units of its first vehicle, the G3 SUV, in the first half. It started deliveries of its second model, the P7 sedan, last week. One P7 variant available in September has a range of up to 706 kilometers (439 miles) on one charge and costs about 254,900 yuan ($36,000) after subsidies, significantly less than competing Tesla and NIO models.Backers of Xpeng, which was founded in 2015, also include e-commerce giant Alibaba Group Holding Ltd. and Xiaomi Corp.(Updates with Xpeng models in sixth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- FX Empire
European Equities: A Week in Review – 11/07/20
After a bullish week, the markets will need to wait until Thursday for stats. That leaves the majors exposed to COVID-19, geopolitics, and U.S earnings.
- Benzinga
Daimler Previews Q2 Earnings Upside Surprise
Daimler AG (OTC: DDAIF) will report better-than-expected second-quarter earnings next Thursday, July 23. But job cuts are a big part of the brighter picture."We took proactive decisions on costs and spending and focused intensely on working capital management," said CEO Ola Kaellenius, Chairman of the Board of Management of Daimler AG and Mercedes-Benz AG."But, there is still much to do. Our systematic efforts to lower the break-even of the company by reducing costs and adjusting capacity will need to continue."The company is seeking 2 billion euros in annual savings through staff cuts. That is equivalent to more than 20,000 jobs, Germany's Handelsblatt newspaper reported Friday.Daimler has said it is seeking to save more than 1.4 billion euros from annual staff costs, according to Reuters.The parent company of Daimler Trucks & Buses and Mercedes-Benz passenger vehicles said it spent €129 million on buyouts and early retirements in the second quarter.Daimler will stop building the Mercedes-Benz C-Class sedan in Tuscaloosa, Alabama. But it will continue to produce sport utility vehicles (SUVs). It also will stop making a variant of the compact Mercedes-Benz A-Class in Aguascalientes, Mexico, Reuters reported.Still At A Loss The German automaker expects a second-quarter operating loss of €1.68 billion euros ($1.91 billion). The company released the projection Thursday. Analysts called for a -€2.3 billion loss. Cash flow and liquidity also are expected to top forecasts."Daimler pre-released better-than-consensus second-quarter numbers," Jefferies analyst Philippe Houchois said.Daimler Trucks & Buses is expected to report adjusted earnings before interest and taxes of -€747 million. Consensus is -€823 million. Freightliner and Western Star truck brands are sold by Daimler Trucks North America (DTNA) It is the leading manufacturer in North America.Click for more FreightWaves articles by Alan Adler.Related articles:Daimler, PACCAR join rivals in suspending truck productionSliding sales prompt restructuring at Daimler TrucksDaimler to lay off at least 10,000 workers worldwideSee more from Benzinga * Air Canada Cargo Chief To Head Freighter Operator Amerijet * Training And Collaboration Key To Successful White Glove Delivery * Mobile Robots Feed Warehouse Demand For Adaptability(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
- Bloomberg
Daimler Must Wish It Had Kept That Tesla Stake
(Bloomberg Opinion) -- Tesla Inc.’s march to a $275 billion market capitalization has been pretty galling for Germany, the birthplace of the automobile. But the pain is felt most acutely at Daimler AG, which used to be a large Tesla shareholder.Had the owner of the luxury Mercedes-Benz brand kept hold of the almost 5 million shares it offloaded in 2014, they would now be worth about $7.3 billion by my calculation — a sum that’s equivalent to two-thirds of Daimler’s current net industrial cash position.(1)In the annals of ill-timed investment decisions, that stake sale doesn’t quite match the U.K.’s flogging off a big chunk of its gold reserves when prices bottomed out around the turn of the millennium. It still hurts, particularly at a time when industrial companies are counting every last cent.Fortunately there’s some good news to console Daimler’s long suffering shareholders. The company’s performance in the most recent quarter was a lot better than expected. Instead of burning a large amount of cash, Daimler’s industrial business recorded an almost 700 million-euro ($799 million) inflow during the three-month period. The quarterly operating loss of 1.7 billion euros was also a pretty respectable outcome, considering the pandemic forced the temporary closure of both factories and dealerships.The shares rose on Friday, extending the stock’s rally since its March low to almost 80%. While not Tesla-esque, that’s still pretty racy. Unfortunately, this resilient showing may make the task of restructuring Daimler that much harder.But first, what’s gone right? A recession would normally be devastating for auto sales. However, a pandemic changes the dynamic somewhat: Having a car is pretty helpful if you worry taking public transport might endanger your health.Mercedes’s car sales declined about a fifth in the first half of the year, but in June they were actually higher than the same month a year ago. The brand’s performance in China, where the pandemic seems to have been brought under control, was especially good. It helps too that the jobs of Mercedes’s customers – wealthy white collar workers – probably aren’t as threatened by the pandemic as other parts of the economy.That doesn’t mean Daimler is in the clear. The company’s margins had already deteriorated before the novel coronavirus appeared. Legal troubles involving dirty diesel engines contributed to a string of profit warnings, but the overarching problem was the massive cost of investing in cleaner propulsion technology, and that hasn’t gone away. At the same time, Daimler’s large production and staffing footprint in high-cost Germany and high level of vertical integration (it produces lots of parts itself rather than outsourcing the work) has become unsustainable.New Chief Executive Officer Ola Kallenius wants to trim the workforce by 15,000 positions, but the additional headwinds created by the pandemic may mean that number has to rise. Talks with trade unions have begun but unsurprisingly, they’re not going smoothly.The risk is that Daimler’s decent second-quarter performance lessens the urgency for change. Generating positive cash flow is also unhelpful from a political perspective: While Germany has boosted subsidies for low-cost electric vehicles and cut sales taxes, domestic carmakers have received remarkably little support from their government during this crisis.So Daimler still has plenty of work to do. It’s embarrassing that the world’s largest premium automaker and biggest truck maker is valued at barely 40 billion euros. Considering how Mercedes focuses on the premium end of the market, the car unit should be far more profitable than it is.Yes, Daimler should have moved faster to develop electric vehicles. But it’s not the dinosaur it’s sometimes characterized as. The EQS electric saloon set to go on sale in 2021 promises to cover more than 700 kilometers (435 miles) on a single charge, which might convince even the most range-anxious car buyers to abandon their addiction to combustion engines. The truck unit too is targeting a carbon-neutral fleet in key regions by 2039. In view of previous setbacks, Daimler’s shareholders will take more convincing before they believe in this recovery story and get over the disappointment of missing out on the Tesla rally. (1) Daimler acquired a 9% stake in Tesla in 2009 for the trifling sum of $50 million. The Germans quickly offloaded part of their stake, they got diluted when Tesla raised capital and sold the remaining 4% stake in 2014 for $780 million.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Chris Bryant is a Bloomberg Opinion columnist covering industrial companies. He previously worked for the Financial Times.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Reuters
Daimler to stop building sedans in the U.S. after second-quarter loss
Daimler will stop building Mercedes-Benz sedans in the United States and Mexico as it seeks deeper cuts after posting a smaller-than-expected quarterly loss. The German automaker will halt output of its Mercedes-Benz C-Class sedan in Tuscaloosa, Alabama, leaving the plant producing sport utility vehicles (SUVs) only, it said. "Daimler pre-released better-than-consensus second-quarter numbers," Jefferies analyst Philippe Houchois said in a note.
- Bloomberg
Ericsson Gets Lockdown Boost, Autos See Recovery: Earnings Wrap
(Bloomberg) -- Some slivers of light emerged for the car industry as the first week of earnings season wrapped up for European companies, while the benefits of working from home showed up in results from telecom-equipment company Ericsson AB.German car manufacturer Daimler AG said Friday it saw a gradual recovery in orders in the latter part of the second quarter and rival Volkswagen AG predicted the rebound in China’s car market will pick up pace. Swedish truck maker Volvo AB, however, said it expects a hit to demand in the short and medium term.Daimler and Volkswagen both bounced at the open, making autos the best performer in the Stoxx Europe 600 Index.Network-equipment provider Ericsson, meanwhile, benefited as its telecom-industry customers kept spending to shore up their networks for the onslaught of home-working and streaming.Results from a slew of Nordic banks and industrial companies also are providing an early guide on whether corporate outlooks for the second half will be sufficiently optimistic to prop up the rally in stocks seen since the initial slump as the pandemic hit.For now, the news has been good enough: The Stoxx 600 is up about 1.4% on the week and has surged 33% since its March low. Still, investors are counting on the European Union to make progress on a stimulus package this weekend to underpin the corporate recovery, and German Chancellor Angela Merkel’s comment that “big differences” remain has caused some jitters.Strategists surveyed by Bloomberg predict the market will finish the year lower on worries about rising virus cases globally and a flare-up in U.S.-China tensions derail the nascent economic recovery.Key Developments:European stocks opened higher but reversed after Merkel’s caution on the recovery fundDaimler’s Late-Quarter Recovery Limits Loss to $1.9 BillionEricsson Jumps After Profit Boost From Network UpgradesFresh Wave Prompts Curbs; India Has Million Cases: Virus UpdateHere’s the top virus-related earnings news for today by sector.AutosDaimler said it lost less money than analysts had expected in the second quarter, helped by a recovery in demand late in the period. Mercedes-Benz deliveries in China hit a record in the quarter and retail sales of its cars edged higher in June, echoing the gradual recovery rival Volkswagen has also reported and its optimism on the outlook in China. Analysts said Daimler’s cash performance was strong and the profit hit “much less bad” than had been expected. Daimler shares rose as much as 4.6% with Volkswagen up as much as 3.2%.IndustrialsVolvo’s sales and profit slumped in the quarter, after truck order intake fell by about a third because of the pandemic. The Swedish commercial-vehicle maker anticipates a hit to demand in the short and medium term. The company last month announced plans to cut about 4,100 positions in the second half. Volvo shares rose as much as 5.5%, with Handelsbanken saying the margin performance stands out.Door locks manufacturer Assa Abloy AB’s profit beat analyst estimates and it said its financial targets for the year are still valid. Barring any second wave of lockdowns, it anticipates a gradual improvement in performance. The stock, which jumped 30% from its March low through Thursday, fell 1.8%.Defense firm Saab AB said sales and profit rose in the second quarter but it couldn’t confirm its previous guidance for the year at this stage. Its defense arm saw a surge in orders in the quarter, while the civil arm was hit hard by the pandemic. Citi said the cash performance in the quarter should be well-received and the shares jumped as much as 5.8%.ChemicalsNorwegian fertilizer maker Yara International ASA said its industrial division saw weaker demand in the quarter but said the nitrogen fertilizer market remains robust. It plans to launch a share buyback and reported net income slightly below analyst estimates. The stock rose as much as 4.5% and Citi said the results look “robust” thanks to lower costs, which offset a decline in deliveries.TelecomsEricsson maintained its targets as it said second-quarter sales and profit both beat expectations. Phone companies kept spending through the pandemic as their networks came under strain from the surge in home working and streaming. Handelsbanken said the results are “rock solid” and profit margin at the networks unit was strong. Its shares surged in Stockholm, rising as much as 11%.Telia AB’s second-quarter earnings beat expectations with sales broadly in line. Service revenue took a hit from the virus, with roaming, pay-TV and advertising revenues all lower, but the beat was driven by cost controls. Goldman Sachs said the beat and guidance are “encouraging” and Telia shares rose as much as 2.7%.BanksNordea Bank Abp set aside much larger loan loss provisions than anticipated and reported a fall in fee and commission income. It maintained its cost targets for 2020 and said the credit quality in its loan book remains strong. The bank front-loading its provisions may be taken well, Goldman Sachs said. The shares rose as much as 2.4%.Danske Bank A/S said it saw a rebound in lending activity in the second quarter as its net income beat estimates significantly. It maintained its full-year income target and said it will continue cutting jobs into 2021. Citi said the bank beat across the board and reassured on cost targets. The shares rose as much as 4.4% in Copenhagen.Swedbank AB’s second-quarter net income topped estimates owing to higher volumes of activity, and it set aside 1.2 billion krona to cover potential loan losses, in line with expectations. It is also reviewing options for its merchant payment business. The net interest income beat and lower-than-expected impairments are both positive, Handelsbanken said. The stock rose as much as 5.3%.ConsumerHome appliances group Electrolux AB reported a narrower-than-expected quarterly loss, while sales were in line with forecasts. It said it still sees negative full-year demand in most of its main markets but that the pace of recovery will vary greatly between regions and in many European countries it was faster than predicted in the latter part of the quarter. The stock slumped as much as 4.4%Smokeless tobacco products maker Swedish Match AB profit topped analyst estimates and it said shipments of its Zyn nicotine pouches in the U.S. in the first half of the year are already exceeding total shipments for 2019. Zyn capacity expansion projects in both the U.S. and Sweden are moving ahead according to plan. The stock jumped as much as 8.1%, touching a record high, with Morgan Stanley noting the strong momentum for its nicotine pouches in the U.S.Travel & LeisureOnline casino developer Evolution Gaming AB’s earnings beat estimates as it benefited from sports event cancellations cutting the number of options for customers wanting to place bets. Evolution is one of the best performers in the Stoxx 600 in 2020, up 137% through to Thursday’s close. DNB said the report is “strong” and its near-term outlook robust. Evolution shares rose as much as 3.7%.MediaNorwegian classifieds firm Schibsted ASA’s second-quarter earnings topped expectations significantly as it said trends have improved over the course of the second quarter. Advertising revenue was lower in its media arm but cost-cutting helped to ease the impact on its bottom line. The stock bounced as much as 7.2% with Goldman Sachs saying the outlook from the firm is “reassuring.”Health CareOnline pharmacy Zur Rose Group AG, Switzerland’s No. 2 top-performing stock this year, reported first-half results that were “weak,” according to Zuercher Kantonalbank. This shows that Zur Rose, one of the winners from the coronavirus pandemic, wasn’t able to benefit as much as expected from the crisis, ZKB said. The stock slipped 1.1%.Basic MaterialsRio Tinto Plc said the uneven global recovery from the pandemic, and concern that a second wave could hit, is weighing on the outlook across commodities markets. The miner shipped more iron ore in the second quarter to capitalize on higher prices, but produced less copper amid a supply crunch for the metal. Rio shares rose 1.3%.Business ServicesHome emergency services firm HomeServe Plc said consumer demand for home improvements has bounced back and it remains confident on its outlook. Shares rose as much as 5% to a record high and Citi said the Covid-19 impact on the business has been short-lived.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Reuters
CORRECTED-MORNING BID-Pandemic versus policymakers
This morning, markets seem to be hoping that news of soaring coronavirus fatalities in the United States, worsening Sino-U.S. ties, proposals for localised lockdowns from Israel to Australia and higher-than-expected U.S. weekly jobless claims will somehow go away. U.S. equity futures are up and European shares are around 0.3% higher. The Trump administration reportedly wants to ban Chinese Communist Party members and their families from visiting the United States, while Beijing accused Washington of "gangster logic".
