Mercedes-Benz, profits -34% but no change in estimates. Stable prices
Operating profit falls. Bev orders slow down, but share should remain around 20% of total sales
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That 2024 would be a year of transition for the car was widely predicted. The results of the first three months are putting this in black and white. Adjusted operating profit of Mercedes-Benz Group fell conspicuously to 3.6 billion versus 5.4 billion in 2023 (-33.6%) in the first quarter, a consequence of model rotation in Asia and weak demand for electric vehicles. Earnings per share fell 22.5% to 2.86 versus 3.69 a year ago.
The company left its forecast for the year unchanged, but stated that its automotive margin was 9%, below its annual target and especially well below the result of a year ago (14.8%).
The German luxury car manufacturer struggled with its strategy to strengthen profits by selling more high-end cars. In the first three months of the year, sales weakened for some of its best-selling models as consumers awaited the release of new or upgraded versions of the vehicles.
In addition, the company of the three-pointed star has seen orders for all-electric models slow down. In February, the company recalibrated its sales targets, predicting that the share of battery-powered vehicles (Bev) and plug-in hybrids will remain largely stable in 2024, between 19% and 21% of total sales.
Mercedes said that its prices remained at a high level in the first quarter despite pressure from price cuts triggered by Tesla. The company added that it wants to 'maintain and defend' prices at current levels.
