Thanks to China’s momentum, Daimler is confident about the coming year – Transformation fund resolved – share closes easier | 12/3/20


Daimler boss Ola Källenius wants to keep the pace of recovery from the Corona crisis high.

Daimler is also heading into 2021 with a growth momentum and remains optimistic for China, said the manager in an interview with the Financial Times (Thursday). Part of the recent strong sales in the most important single market is also due to a catch-up effect from the spring, which was heavily affected by pandemics.

In the third quarter, Mercedes-Benz recorded an increase in passenger car sales of almost a quarter compared to the same period last year in the most important individual market. Even in the months after that, growth had reached double-digit percentages, Källenius told the newspaper. Daimler has yet to present the sales figures for November.

Daimler management and employees decide on transformation funds

The Daimler management and the general works council have agreed on a multi-billion dollar conversion fund for the plants. The so-called transformation fund has a volume of 1 billion euros and a term until 2025, as announced by the DAX group. The funds would be available in addition to the planned investments. The structure of the fund is to be determined in the first quarter of 2021.

The funds are to be used primarily for the further development of future technologies and employment in German plants in view of the switch from internal combustion engines to electric drives.

“After controversial discussions in the past few weeks, we have succeeded in setting up a transformation fund of 1 billion euros in addition to the Daimler investment plan,” said General Works Council Chairman Manfred Brecht. “With these additional funds, we have more opportunities to implement new technologies and products in our plants. That secures employment and know-how.”

In addition, on Thursday the supervisory board reaffirmed the investment plan for the transformation towards electrification and digitalization. As planned, Daimler will invest more than 70 billion euros in research and development as well as in property, plant and equipment between 2021 and 2025. The largest share of the investment projects is in Mercedes-Benz passenger cars.

The Daimler share closed in XETRA trading 1.25 percent lower at 56.77 euros.

LONDON (dpa-AFX) / (Dow Jones)

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