DAIMLER yesterday reported weaker than expected third-quarter operating profit as the downturn hit sales of its luxury cars in western Europe.
Earnings before interest and tax (Ebit) dropped 19 per cent to €1.97bn (£1.73bn) in the three months to the end of September, less than the average analyst estimate of €2.21bn in a poll.
Car sales growth has been shrinking in Europe, with Germany the only major market in the region to expand in September, and the boom in China that has bolstered German car makers in recent quarters has tempered to a milder pace for now.
“In western Europe, there is little sign of any significant growth impetus,” Daimler said, adding it expected the region’s markets to shrink slightly in the full year 2011.
Daimler’s automotive business Mercedes-Benz Cars sold two per cent fewer vehicles in western Europe in the third quarter, with stagnating German sales, and its Ebit was down 15 per cent.
Daimler affirmed its outlook for 2011, saying it saw full-year Ebit up very significantly from 2010, with revenues of significantly more than €100bn, but warned that the economic environment was becoming more gloomy.
Daimler Trucks, which generates more than a quarter of group revenues, was a bright spot in the quarter, its Ebit of €555m exceeding consensus.
City A.M. Reporter