Daimler profit falls as tariffs hit Mercedes-Benz
German premium car maker Daimler AG (DAI.XE) said Thursday that second-quarter net profit fell as earnings at its Mercedes-Benz cars division fell due to weaker pricing, stemming from tariffs.
The maker of Mercedes-Benz cars said net profit fell to 1.73 billion euros ($2.02 billion) in the three months ended June 30 from EUR2.44 billion a year ago.
Revenue fell slightly to EUR40.76 billion from EUR41.21 billion the prior year, the company said. Earnings before interest and taxes in the period dropped 21% to EUR2.64 billion.
Analysts had expected revenue of EUR42.48 billion and EBIT of EUR2.76 billion, according to a consensus estimate provided by FactSet.
In June, Daimler warned that Chinese retaliatory tariffs on U.S.-made vehicles would hit sales and profits of the SUVs it manufactures at its Alabama plant. In its profit warning, the company said a switch to new European emissions regulation as well as recalls of diesel vehicles could weaken results over the rest of the year.
"The automotive industry and therefore we too have many challenges to overcome," Chief Executive Dieter Zetsche said.
The auto maker said earnings at its Mercedes-Benz cars division fell 9% to EUR1.9 billion, while earnings at its trucks division fell 1% to EUR546 million.
The company confirmed its 2018 guidance, forecasting a slight increase in unit sales and revenue but a slight decline in EBIT.
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