Daimler sets sights on profit after sales slump due to coronavirus
German car giant Daimler said it expected profit to rebound in the second half of the year even as it reported a 34 per cent fall in vehicle sales due to coronavirus.
In total, the Mercedes-Benz owner said vehicle sales in the second quarter totalled 541,800, down from 821,700 in the same period last year.
Revenue slipped 29 per cent to €30.2bn, while the firm made a net loss of €1.9bn.
However, Daimler said the firm was now beginning to see the first signs of recovery, with strong demand for its Mercedes-Benz cars.
In a statement, the company said that it expected both earnings and cash flow would be positive for the year as a whole, though both would be lower than last year.
However, it warned that because it did not expect the slump in unit sales to be offset by the end of the year, it would have to continue with efficiency measures.
When the pandemic struck in the spring, Daimler countered the drop in demand by quickly suspending production in March, April and May, and by introducing short-time work.
Due to various steps taken to protect its finances, the firm said that liquidity had improved to €9.5bn, up €200m from the previous quarter.
Chairman Ola Källenius said: “Due to the unprecedented COVID-19 pandemic, we had to endure a challenging quarter.
“But our net industrial liquidity is a testament to effective cost control and cash management, which we must continue to enforce.
“We are now seeing the first signs of a sales recovery – especially at Mercedes-Benz passenger cars, where we are experiencing strong demand for our top end models and our electrified vehicles”.
Earlier this week Swedish car maker Volvo said that it was also targeting a return to profit in the second half of the year, saying that it expected the downturn to be a temporary one.