TU-TESL

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According to euronews, Daimler, the parent company of Mercedes Benz, has cautiously warned financial analysts that its carbon dioxide compliance costs and market resistance in 2020 will be much higher than previously expected, requiring them to cut their earnings forecasts by billions of euros. Four securities firms, two in Germany and two in the UK, who declined to be named, confirmed that Daimler had contacted investors in recent weeks to discuss 2020 expectations ahead of Thursday's capital market presentation in London and Friday's meeting with investors in New York. Daimler told analysts that the group's estimated operating profit of more than 10 billion euros in 2020 is too high, more than about a fifth, because it has increased investment costs to promote the electrification of Mercedes Benz, while facing the accelerated decline of heavy commercial vehicles. "We have completely controlled our CO2 compliance costs, and Daimler, this is a huge problem, so now they are trying to reduce their earnings expectations by 20%," said one analyst based in London During the conference call, representatives of Daimler investor relations said that Mercedes Benz is expected to face new resistance of 1.2 billion to 1.5 billion euros, while the cyclical economic downturn will reduce the performance of Daimler trucks by 700 million to 800 million euros. Although investor relations teleconferencing is common, in most cases it is done out of politeness to individual analysts so that they do not make silly unrealistic expectations. "It's unusual to call every analyst," said one To cut the general profit forecast of the entire investment community by a fifth to less than 9 billion euros "is basically that management wants to be ready before the arrival of the CMD (capital market day).". They don't want to bring more bad news on Thursday. " Daimler will hold investor day on November 14. According to media reports, at that time, Daimler will also announce the latest strategy formulated by the new chief executive, conlinson, including cost cutting measures. It is said that Daimler will cut 1100 leadership positions globally, accounting for about 10% of its management. After taking over Daimler from Zetsche in May, Conlin song is seeking to save billions of dollars to cope with the adverse factors such as low sales and huge investment in electrification. Previously, in order to improve the profitability, kanglinsong said that by 2025, Daimler will substantially reduce the R & D cost of new Mercedes Benz and strengthen the alliance with competitors. Daimler's performance has been pretty ugly this year. The company issued two earnings warnings this year, one in June and the other in July a few weeks later. If investors had unrealistic expectations in Thursday's capital markets report, their Fed's credibility could be further undermined. In the past third quarter, despite a slight increase in Daimler's operating profit, EBIT increased by 8% to 2.69 billion euros, up from 2.49 billion euros in the same period of last year, mainly driven by 8% growth in sales of Mercedes Benz luxury cars and steady cash flow. But Daimler said it would reassess costs after its profit margin fell to 6% from 6.3% a year earlier. According to Daimler group's second quarter financial report, Mercedes Benz diesel emissions fraud caused Daimler to lose 1.07 billion euros. At the same time, Daimler increased the provision for legal and government litigation costs for diesel vehicles by 1.6 billion euros. In the second quarter, Daimler's operating revenue was 42.65 billion euros, up 5% year-on-year, with an EBIT loss of 1.56 billion euros and a profit of 2.6 billion euros for the same period last year. It was the first time Daimler group had a quarterly loss nine years later. Mercedes Benz's return on car sales fell from 8.4% in the same period in 2018 to - 3% this year. According to the company's internal forecast, the profit margin of Mercedes Benz's auto sector is likely to drop to 3% this year. Although Daimler has not yet announced its profit target for 2020, it said in February that it will implement cost cutting plans to ensure that its core Mercedes Benz passenger car business can return to the target profit margin range of 8% - 10% by 2021. This is a key commitment to boost capital market confidence in Daimler's plans, but the company declined to provide specific cost cutting targets. Daimler explained that it was enough to let investors know that these strategies were designed to achieve this goal. Many analysts believe this means that Daimler's expected return this year will rise from the current 3% to 5%. On Thursday, at the automotive Woche conference in Berlin, Mr. conlinson said he would not "warn" about financial targets in the capital markets report. Daimler declined to comment on the details. "The issue of compliance with CO2 emission standards has been discussed for a long time in the industry and capital markets," the company said in a statement. We discussed this topic a long time ago and developed a roadmap for carbon dioxide emissions. As before, this huge effort requires investment in the future, and it will cost you all know. "