Luxury auto firms enjoy jump in sales
LUXURY car-makers Daimler and Audi said a surprise jump in demand will drive profits for the rest of the year, in separate updates yesterday.
Daimler expects rising sales of its most expensive Mercedes-Benz models to push operating profit to €6bn (£5bn), its best result since the auto industry boom peaked three years ago.
The German company said its second-quarter cash flow was €2.5bn and net cash was €9.4bn at the end of the first half.
It increased its earnings outlook for the Mercedes unit for the second time this year, to a
target of €4bn earnings before interest and tax. Just over half of that figure was achieved in the six months to June.
“Our strategy is paying off: We have a very dynamic development of unit sales and revenue in all divisions. After what was already a very good first quarter, we achieved excellent results in the second quarter,” said chief executive Dieter Zetsche in a statement.
Analysts responded positively to the news. “There were no special items in the results that may have lowered the earnings quality, and the industrial free cash flow was much better than consensus,” said Commerzbank analyst Sascha Gommel. “There is nothing in the results or the outlook that would give a concrete reason to sell the share.”
Audi’s chief executive said its first-half results on Friday will be better than expected. “We are positively surprised by how we’ve started in 2010,” said Rupert Stadler yesterday. “We will also have a good second half of the year.”
The auto industry has recovered faster than expected in the US, and a growing number of affluent customers in China has further boosted sales.