December 5, 2023

Daimler Profit Nearly Doubles in First Quarter

FRANKFURT — Daimler said Friday that it nearly doubled its profit in the first quarter as sales in China continued to show big gains and the market for heavy trucks recovered.

The maker of Mercedes cars and Freightliner trucks, based in Stuttgart, said that net profit rose to €1.18 billion, or $1.75 billion, compared to €612 million in the first quarter of 2010. Sales rose 17 percent to €24.7 billion.

The figures were in line with expectations, but shares in the company fell 2 percent as investors registered disappointment that the company seemed to simply be benefiting from an improved global economy.

“I wouldn’t say there is anything particular about their products or way of doing business that is the main reason for the improvement,” said Sascha Heiden, an auto analyst at IHS Global Insight in Frankfurt. “It’s the natural mechanism of volumes bouncing back and purchasing power bouncing back.”

The first quarter result “confirms our positive outlook for the year 2011,” Daimler’s chief executive Dieter Zetsche said. “We are on the right track.”

Like rivals BMW and the Audi division of Volkswagen, Daimler’s Mercedes car division is profiting from the appetite for luxury cars among Chinese buyers. Unit sales in China rose 82 percent to almost 50,000 vehicles, Daimler said.

Daimler also exemplifies the success of Germany’s export economy, which has driven unemployment to a nearly 20-year low of 7.1 percent. Daimler said Friday that it had added almost 2,700 employees in Germany since the end of March 2010, bringing the total inside the country to 164,000.

Car sales also rose modestly in Mercedes’ traditional markets, increasing 4 percent in both the United States and Europe.

The same factors helped sports car maker Porsche, also based in Stuttgart, to more double its operating profit in the first quarter to €496 million, as sales rose 10 percent to €2.3 billion, the company said Friday.

Porsche said profit of the holding company that owns its shares was €691 million in the first quarter, after a loss a year earlier. The result included earnings from the company’s stake in Volkswagen, with which Porsche is in a complex merger process.

Daimler said that truck sales, which tend to closely track economic growth, rose 27 percent to 89,000 vehicles. Operating profit for the trucks division more than tripled to €415 million. Daimler’s commercial vehicle brands include Freightliner in the United States and Mitsubishi Fuso in Japan.

Daimler said it would take charges of €78 million for damages and lost production due to the earthquake and tsunami in Japan and “will remain watchful.” It said the charges do not reflect insurance compensation the company might receive.

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