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Daimler Dives Into the Red, Again

Q2 loss lessens, but near-term profits likely elusive.

by on Jul.29, 2009

A turnaround at Daimler AG will likely depend on getting a lot of these 2010 Mercedes-Benz E-Class sedans and coupes into customer hands ASAP.

A turnaround at Daimler AG will likely depend on getting a lot of these 2010 Mercedes-Benz E-Class sedans and coupes into customer hands ASAP.

Daimler AG continued to see its losses mount, during the second quarter of 2009, but reported a stronger financial position as its earnings from continuing operations improved.

Daimler lost $560 million in the second quarter compared to the nearly $2 billion loss in first three months of the year.  Still, that was a far cry from the substantial profit the company posted a year ago.  And Dieter Zetsche, Chairman of the Board of Management of Daimler AG, warned that the German automaker may not return to profitability this year because of the severe global recession.

The improvement is likely to be gradual at best and rests on scoring a solid, global hit with the new E-Class, Zetsche said.  The automaker has completely redesigned its mid-line sedan, for the upcoming year, and added a coupe to the E-Class line-up, as well.

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Meanwhile sales of trucks, busses and vans also continue at low ebb because of the broad economic downturn around the world.

Overall, Daimler posted a net loss of $1.4 billion compared to net income of $1.95 billion in the same period a year ago. Daimler reports in Euros but the loses have been translated into dollars, with an exchange rate set at $1.40 to the Euro.

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