Daimler said first-quarter operating profit surged 41 percent on the effects of new model launches and record sales of Mercedes-Benz cars. Overall adjusted group earnings before interest and tax (EBIT) jumped to 2.93 billion euros ($3.19 billion).
The return on sales from ongoing business at Mercedes-Benz Cars came in at 9.2 percent, up from 7 percent in the first quarter last year, lifted by record deliveries of its passenger cars. Daimler CEO Dieter Zetsche has a goal for Mercedes, the world’s third-biggest maker of luxury vehicles, to overtake premium-industry leaders BMW and Audi in sales by the end of the decade and boost profitability to 10 percent of revenue.
Daimler said record deliveries last month in Europe, China and the United States drove up quarterly passenger car sales to 459,708 models, exceeding last year’s high by 18 percent. Daimler reiterated it expects significant growth in revenue, EBIT and unit sales from ongoing business this year. The automaker said it plans to invest 25 billion euros in developing models and building plants through 2016.
Analysts said sales momentum will continue with recent and forthcoming model launches. Mercedes is pushing a raft of SUVs this year, including the all-new GLE coupe and the GLC model, successor to the GLK compact SUV.
The rollout of a new version of its top-selling C-class sedan helped the Mercedes-Benz Cars unit to raise earnings. First-quarter EBIT at the division, which also includes the Smart city-car brand, jumped 56 percent to 1.84 billion euros. The Daimler Trucks unit, which builds Mercedes and Freightliner commercial vehicles, posted a 38 percent increase in EBIT to 472 million euros. Earnings at the Mercedes-Benz van business surged 75 percent to 215 million euros.
Daimler is the first of Germany’s three luxury automakers to publish quarterly earnings, with some analysts concerned that slowing Chinese economic growth could curb a major source of demand in recent years.
