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Recovery on track at Daimler as Q1 sales rise

By Neil Dennis

07:36, 23 April 2021

Sales of luxury brand Mercedes-Benz lead Daimler higher

Daimler (DAI), the German carmaker, reported strong earnings growth in the first quarter as the recovery from the effects of the COVID-19 pandemic gathered pace.

The company, which owns the iconic Mercedes-Benz brand, said the worldwide car market had grown “significantly” compared with its volume in the same quarter last year.

“The Chinese car market, which had already reached its low point in February last year, therefore expanded by around 75% in the past quarter,” the company said.

Sales and revenue growth

Indeed, the company reported a 13% rise in unit sales to 728,609, from 644,316 in the same period a year ago. Revenues were up 10% to €41bn ($49.4bn).

This was driven by strong demand for its key luxury brand. Unit sales of Mercedes-Benz cars and vans rose 15% to 627,287, while revenues climbed 16% to €26.9bn.

Net profit rose to €4.37bn from a severely pandemic-hit figure of €168m in the first quarter of 2020. That created earnings per share of €4.01 ($4.83), up from €0.09 ($0.11) a year ago.

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Outlook

The company said that based on the expected global economic recovery, demand for cars would continue to develop “favourably” in 2021. “Significant growth in market volume is expected for 2021 as a whole,” the company added.

Daimler warned, however, that the global shortage in components, particularly semiconductors, that has hit production at all carmakers, could further impact sales in the second quarter.

The company announced on Thursday that it was to put 18,500 German workers on short time due to the chip shortage.

“Currently, there is a worldwide supply shortage of certain semiconductor components,” a spokesperson said. “We continue to play things by ear. The situation is volatile, so it is not possible to make a forecast about the impact.”

Shares in Daimler climbed 1% to €74.40 in early trade on Frankfurt Stock Exchange.

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Read more: Chip shortage halts production at Jaguar Land Rover

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