Mercedes-Benz owner Daimler swung to a €1.2bn loss in the second quarter after the manufacturer was forced to make payments for diesel-related legal issues and to cover the costs of replacing Takata airbags, as it battled a global slump in car demand.
The German manufacturer reported a net loss of €1.2bn between April and June down from €1.8bn profit in the second quarter of 2018.
The group said earnings before tax fell to a €1.6bn loss, down from €1.8bn profit last year.
Revenue increased by five per cent from €40.8bn to €42.7bn. However, total unit sales fell one per cent to 822,000.
Why it’s interesting
Daimler said the weakening of worldwide demand for cars continued in the second period and was below levels seen in the second quarter of last year driven by a slowdown in China.
Alongside the slump in demand, Daimler faced extra costs related to ongoing government and court proceedings in connection with its diesel cars. The company also faced additional charges for an expanded recall of Takata airbags.
What Daimler said:
Ola Kallenius, Daimler chairman and head of Mercedes-Benz cars, said: “Our second quarter results were mainly impacted by exceptional items of 4.2 billion euros.
“Therefore, our focus for the second half of this year is on improving our operating performance and cash-flow generation.
“In general, we are intensifying the Group-wide performance programs and reviewing our product portfolio in order to safeguard future success. At the same time, we are continuing consistently our company transformation.”