German car and truck maker Daimler AG says net profit rebounded strongly to 4.4 billion euros in the first three months of the year, as the global economic rebound and robust demand for high-priced luxury vehicles fattened the bottom line.
The company on Friday raised its outlook for an important measure of profitability this year, saying that it now expected profit of 10 per cent-12 per cent on sales of its Mercedes-Benz cars, up from an outlook for 8 per cent-10 per cent in its last estimate. Strong profits on conventional vehicles are key to funding the huge investments in new technologies such as electric cars and digital services that are shaking up the auto industry.
Chief Financial Office Harald Wilhelm said that 'after this promising start, we are very confident that we can keep up the pace to improve our margins on a sustainable basis and at the same time expand our electric vehicle line-up'. He cited strong tailwinds for the company’s business in China.
The company is accelerating its introduction of new electric vehicles; on April 15 it showed off the EQS, the battery-powered equivalent of its flagship S-Class large sedan.
The first-quarter profit compared to the 168 million euros scraped out in the first quarter of 2020, when the company shut down factories and shifted into cash preservation mode in the first phase of the coronavirus pandemic.
Daimler AG revenue rose 10 per cent to 41.0 billion euros as sales at the Mercedes-Benz car business jumped 15 per cent to 538,869. Daimler’s truck business, slated for spinoff later this year, saw sales revenue slip 1 per cent to 8.66 billion euros but more than doubled adjusted operating profit to 518 million euros from 247 million in the year-ago period. The division’s brands include Freightliner and Western Star trucks.