Daimler’s Q3 profit dips on diesel car fix costs
FRANKFURT: Daimler AG’s profit slumped 14 per cent in the third quarter as earnings at the Mercedes-Benz cars unit dropped on costs to fix the emissions systems of older diesel cars.
Earnings before interest and taxes declined to €3.46 billion (RM17.33 billion) from €4.04 billion a year earlier, said the Stuttgart-based manufacturer in a statement yesterday.
Daimler’s first drop in quarterly profit in more than a year was slightly below a forecast of €3.55 billion, based on the average of five analyst estimates compiled by Bloomberg.
Daimler booked charges totaling €453 million in connection with vehicle recalls and upgrades of more than three million diesel vehicles over German government concerns about excess pollution from the models.
Alongside the fallout from Volkswagen AG’s cheating scandal, allegations of a decades-long German-auto cartel have added to burdens from the shift to electric, self-driving cars.
The world’s biggest maker of luxury cars and heavy trucks spent €2.3 billion on research and development in the third quarter, 21 per cent more than a year ago.
Daimler, stuck to its expectation of “significantly” boosting group earnings, revenue and vehicle deliveries for the year. Through the first nine months of this year, operating profit is up 19 per cent to €11.2 billion.
To respond to the changes sweeping the auto industry, Daimler earlier this week firmed up plans to grant its car and truck operations more independence in a move that could pave the way for spin-offs and other deals.