Daimler seeks €1 billion in savings at Mercedes-Benz by cutting jobs

By REUTERS | 15 November 2019


FRANKFURT: Tougher emissions rules will hit Daimler’s profits in 2020 and 2021, prompting the German carmaker to seek more than €1 billion (RM4.6bil) in savings from cutting staff costs at its Mercedes-Benz business by the end of 2022, it said on Thursday.

Management positions will be cut by around 10%, and the company said it would also seek more than €300 million (RM1.38bil) from cutting personnel costs - plus another €250 million (RM1.15bil) in fixed costs - at its trucks business.

Daimler said it needed to sell more electric vehicles to meet tougher European Union rules which force carmakers to cut carbon dioxide emissions from cars by 37.5% by 2030 compared with 2021 levels, and following a 40% cut between 2007 and 2021.

The company said it expected to achieve a return on sales from operating activities at Mercedes-Benz Cars & Vans of at least 4% in 2020 and at least 6% in 2022.

Mercedes-Benz expects car sales to grow by around 3% in 2020, but said potential trade tariffs and Brexit could depress the return on sales by up to 1%.

Earlier this year, Daimler had said it hoped to achieve a return on sales of 3% to 5% at Mercedes-Benz Cars.

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