Luxury Cars – Annual Meeting: Daimler Accelerates Electric Push
Clearance Jewelry.STUTTGART, Germany, March 31, 2021 /PRNewswire/ —
- Electric mobility: broadest product portfolio in the automotive industry ranging from city cars to heavy-duty trucks
- Ambition2039: transformation toward CO2 neutrality to be accelerated
- Project Focus: spin-off and listing of Daimler Truck in preparation
- Pandemic stress test: financial year 2020 with better-than-expected results
- Taking the helm: Bernd Pischetsrieder succeeds Manfred Bischoff as Chairman of the Supervisory Board
- First quarter 2021: positive trend from 2020 continues
Daimler AG (ticker symbol DAI) is pressing ahead with its structural realignment and the acceleration of a shift to electric mobility. “The year 2020 was the most challenging for Daimler during my term as Chairman of the Supervisory Board. We passed the pandemic stress test with flying colors, defined the necessary cost-cutting measures, and initiated their consistent implementation to make the company more crisis-proof. We also refocused our strategy on sustainability and climate protection. Our sustainable business strategy must strike a responsible balance between environmental, social and financial goals,” said Manfred Bischoff, Chairman of the Supervisory Board of Daimler AG, on Wednesday at the company’s virtual regular Annual Meeting. Bischoff has been Chairman of the Supervisory Board since 2007 and is stepping down after the Annual Meeting.
This year Mercedes-Benz Cars is significantly expanding its offering of fully electric vehicles: The compact electric model EQA will be followed shortly by the EQS (WLTP range of up to 770 km) and the EQB as well as the EQE later this year. Also, Mercedes-Benz Vans will enrich the portfolio with electric vehicles: before the end of the year concepts for an electrified Citan and the T-Class will be presented. Daimler Trucks & Buses is also focusing on CO2-neutral passenger and goods transportation: Series production of the eActros, which has a range of well over 200 kilometers and is suitable for urban heavy goods and distribution transport, will start in fall this year. For longer distances with a range of about 500 kilometers, the eActros LongHaul is being developed for market launch as of 2024. In addition, fuel-cell trucks are scheduled to go into series production in the second half of the decade. With the buses, the eCitaro and the articulated eCitaro are two vehicles already available for CO2-neutral urban transport.
“Today, Daimler has the broadest electric range in the automotive industry – from city cars to heavy-duty trucks. But that’s not enough for us. We want to accelerate the electrification of our product portfolio. Almost two years ago, we presented our Ambition2039. We want a CO2-neutral fleet of new cars. It’s our goal to reach this target sooner,” said Ola Källenius, Chairman of the Board of Management of Daimler AG and of Mercedes-Benz AG.
A prerequisite for the breakthrough of electric mobility is an efficient public charging infrastructure which expands to keep pace with the electric ramp-up of manufacturers. To meet the European Commission’s CO2 targets, Europe needs three million public charging points by the end of the decade. “Today, we don’t even have a tenth of this. We need to speed this up. Daimler, as part of the auto industry, will play its part. For example, we will further expand the Ionity charging network. I am convinced: When industry and politics work hand in hand, we move forward together. We should not focus our efforts only on banning the status quo. We should make possible the new, this is key,” said Källenius.
Project Focus offers potential
In order to utilize the full potential of the two industrial divisions during the industrial transformation and to create sustainable value, the Board of Management and Supervisory Board decided in February 2021 to initiate a fundamental change to the Group’s structure: Daimler intends to spin off Daimler Truck and list it on the stock exchange. It is planned to transfer a significant majority stake in Daimler Truck to the Daimler shareholders. “With a clear focus on commercial vehicles on one side, premium cars and vans on the other, we are creating the preconditions for more financially successful companies and thus also offer enhanced long-term job security. It is a matter of fact that the transformation of the automotive industry more than ever requires speed and an undivided focus on innovation,” said Bischoff. The transaction and the listing of Daimler Truck on the Frankfurt Stock Exchange are expected to be completed by the end of 2021. It is also intended to rename Daimler as Mercedes-Benz in due course. The planned spin-off will be under voting at an Extraordinary Shareholder’s Meeting which is planned to take place in fall of 2021.
Path to profitable growth
“We want to shape the future. We are on the right track financially. Now we are keeping up the pace in order to achieve our profitability targets on a sustainable basis. Under strong market conditions, we strive for a double-digit margin at Mercedes-Benz Cars,” said Källenius. Daimler’s Board of Management was aware of its great responsibility towards employees, also with the targeted restructuring of sites. “In the long run, it benefits no one to work in a plant with a great tradition. It’s more important to work in plants with a great future. We do not wait for change – we are the ones who are changing. We will continue growing profitably and at the same time help make this world climate neutral with the aid of exceptional engineering and with a deep sense of conviction.”
2020 financial year better than expected
For the challenging 2020 financial year, marked by the COVID-19 pandemic, the Board of Management and the Supervisory Board propose distributing a dividend of €1.35 per share (2019: €0.90), in line with the company’s long-term dividend policy. As a result of strict cost discipline and extensive measures to preserve liquidity, as well as a strong performance in the divisions, EBIT increased by 53% to €6.6 billion. Adjusted EBIT reflects the ongoing business and amounted to €8.6 billion (2019: €10.3 billion). Net profit increased to €4.0 billion from €2.7 billion. Net profit attributable to the shareholders of Daimler AG amounted to €3.6 billion (2019: €2.4 billion). The Group’s unit sales fell by 15% to 2.84 million cars and commercial vehicles. Revenue decreased by 11% to €154.3 billion. The free cash flow of the industrial business amounted to €8.3 billion (2019: €1.4 billion). The adjusted free cash flow of the industrial business was €9.2 billion (2019: €2.7 billion). The net liquidity of the industrial business improved to €17.9 billion (end of 2019: €11.0 billion).
Outlook first quarter 2021
After a good start with a tailwind from last year, Daimler is confident about the current financial year. Based on the anticipated market development and the current assessments of the divisions, unit sales, revenue and EBIT in 2021 are still expected to be significantly above prior-year levels.
In the first quarter of 2021 the positive trend seen in previous quarters continues. Despite temporary bottlenecks for semiconductors, unit sales and revenues at Mercedes-Benz Cars & Vans should be higher than in the prior year’s quarter, thanks to the Chinese market and a strong product mix. Due to strong pricing and continued stringent cost control, Mercedes-Benz is confident about profitability in the first quarter. Incoming orders at Daimler Trucks are very promising, especially in Europe and the US. Unit sales in the first quarter are expected to remain at year-earlier levels, despite the impact from the pandemic on the Indonesian market and on the bus chassis business. Thanks to stringent cost management, strong product mix and disciplined pricing, profitability is seen higher than in the first quarter last year. Furthermore, semiconductor bottlenecks are affecting the supply chain of Daimler Trucks & Buses. The division monitors the situation closely and is in constant contact with the suppliers.
Changes in the Supervisory Board
Petraea Heynicke, Jürgen Hambrecht and Manfred Bischoff are stepping down from the Supervisory Board at the end of the Annual Meeting. Elizabeth Centoni, Chief Strategy Officer and General Manager of Applications at Cisco Systems, Inc., Ben van Beurden, CEO of Royal Dutch Shell plc, and Martin Brudermüller, Chairman of the Board of Executive Directors of (BA)SF SE, are proposed for election at the Annual Meeting. Bischoff’s departure after 14 years as Chairman of the Supervisory Board marks the end of an era. “It is fair to say that Manfred Bischoff has left his mark on a piece of German industrial history. This company is extremely well positioned for the future, and that is largely thanks to him,” said Källenius. In December 2020, the Supervisory Board proposed as Bischoff’s successor Bernd Pischetsrieder, who will stand for election as Supervisory Board Chairman at the constituent meeting of the new Supervisory Board after the end of the Annual Meeting.
Further information on Daimler is available on the Internet: www.media.daimler.com and www.daimler.com
This document contains forward-looking statements that reflect our current views about future events. The words “anticipate,” “assume,” “believe,” “estimate,” “expect,” “intend,” “may,” “can,” “could,” “plan,” “project,” “should” and similar expressions are used to identify forward-looking statements. These statements are subject to many risks and uncertainties, including an adverse development of global economic conditions, in particular a decline of demand in our most important markets; a deterioration of our refinancing possibilities on the credit and financial markets; events of force majeure including natural disasters, pandemics, acts of terrorism, political unrest, armed conflicts, industrial accidents and their effects on our sales, purchasing, production or financial services activities; changes in currency exchange rates, customs and foreign trade provisions; a shift in consumer preferences towards smaller, lower-margin vehicles; a possible lack of acceptance of our products or services which limits our ability to achieve prices and adequately utilize our production capacities; price increases for fuel or raw materials; disruption of production due to shortages of materials, labor strikes or supplier insolvencies; a decline in resale prices of used vehicles; the effective implementation of cost-reduction and efficiency-optimization measures; the business outlook for companies in which we hold a significant equity interest; the successful implementation of strategic cooperations and joint ventures; changes in laws, regulations and government policies, particularly those relating to vehicle emissions, fuel economy and safety; the resolution of pending government investigations or of investigations requested by governments and the conclusion of pending or threatened future legal proceedings; and other risks and uncertainties, some of which are described under the heading “Risk and Opportunity Report” in this Annual Report. If any of these risks and uncertainties materializes or if the assumptions underlying any of our forward-looking statements prove to be incorrect, the actual results may be materially different from those we express or imply by such statements. We do not intend or assume any obligation to update these forward-looking statements since they are based solely on the circumstances at the date of publication.
Daimler at a Glance
Daimler AG is one of the world’s most successful automotive companies. With its Mercedes-Benz Cars & Vans, Daimler Trucks & Buses and Daimler Mobility divisions, the Group is one of the leading global suppliers of premium and luxury cars and one of the world’s largest manufacturers of commercial vehicles. Daimler Mobility offers financing, leasing, fleet management, investments and insurance brokerage, as well as innovative mobility services. The company founders, Gottlieb Daimler and Carl Benz, made history by inventing the automobile in 1886. As a pioneer of automotive engineering, Daimler sees shaping the future of mobility in a safe and sustainable way as both a motivation and obligation. The company’s focus therefore remains on innovative and green technologies as well as on safe and superior vehicles that both captivate and inspire. Daimler continues to invest systematically in the development of efficient powertrains – from high-tech combustion engines and hybrid vehicles to all-electric powertrains with battery or fuel cell – with the goal of making locally emission-free driving possible in the long term. The company’s efforts are also focused on the intelligent connectivity of its vehicles, autonomous driving and new mobility concepts as Daimler regards it as its aspiration and obligation to live up to its responsibility to society and the environment. Daimler sells its vehicles and services in nearly every country of the world and has production facilities in Europe, North and South America, Asia and Africa. In addition to Mercedes-Benz, the world’s most valuable luxury automotive brand (source: Interbrand study, 20 Oct. 2020), and Mercedes-AMG, Mercedes-Maybach, Mercedes-EQ and Mercedes me, its brand portfolio also includes commercial vehicle brands Mercedes-Benz Trucks Freightliner, Western Star, BharatBenz, FUSO, Setra and Thomas Built Buses as well as the brands of Daimler Mobility: Mercedes-Benz Bank, Mercedes-Benz Financial Services, Daimler Truck Financial and Athlon. The company is listed on the Frankfurt and Stuttgart stock exchanges (ticker symbol DAI). In 2020, the Group had a workforce of around 288,500 and sold 2.8 million vehicles. Group revenues amounted to €154.3 billion and Group EBIT to €6.6 billion.
SOURCE Daimler North America – Corporate Communications
Luxury Cars – Annual Meeting: Daimler Accelerates Electric Push