Daimler AG - Company Strategy & Performance Analysis
Daimler AG (Daimler) is an automobile company that undertakes the manufacture, distribution and sale of premium passenger cars, commercial vehicles and related spare parts and accessories. The company also provides finance, leasing, fleet management, insurance, financial investment, credit and innovative mobility services. Daimler’s products include city and intercity buses, coaches, bus chassis, vans, passenger cars, and trucks. Its key brands include Mercedes-Benz, smart, FUSO, Western Star, Bharat Benz, moovel, car2go and Setra. The company sells its vehicles and services on a global scale and has production facilities in Europe, North and South America, Asia, and Africa. Daimler is headquartered in Stuttgart, Baden-Wurttemberg, Germany.
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Daimler’s revenue increased over 2016-2017
Daimler reported a 9.4% increase in revenue, from US$169.5bn in 2016 to US$185.3bn in 2017. The company operates its business through five segments: Mercedes-Benz Cars, Daimler Trucks, Mercedes-Benz Vans, Daimler Buses, and Daimler Financial Services. In 2017, the company generated 55.4% of its total revenue from the Mercedes-Benz Cars segment, followed by Daimler Trucks (20.8%), Daimler Financial Services (13.6%), Mercedes-Benz Vans (7.7%), and Daimler Buses (2.6%). The revenue generated by Mercedes-Benz Cars’ rose by 8.2%, from US$94.8bn in 2016 to US$102.6bn 2017, while that of Daimler Trucks increased by 9.9%, from US$35.1bn in 2016 to US$38.5bn in 2017.
Strong performance from the company’s new E-Class division has led to Mercedes-Benz Cars revenue growth
The Mercedes-Benz Cars segment designs, develops, manufactures, assembles and sells passenger cars and off-road vehicles. Its vehicles range from the compact models of the A-Class, B-Class, and C-Class, to SUVs, roadsters, coupes, convertibles, sports cars, and S-Class luxury sedans. The segment reported revenues of US$102.6bn in 2017 in comparison to US$94.8bn in 2016, an increase of 8.2%. This was due in part a 9% increase in sales volume in France, 9% in Italy, 8% in Spain, 6% in the UK, 28% in China, 31% in Thailand, 14% in India, 9% in South Korea, and 7% in Taiwan during 2016-2017. Growth can primarily be attributed to the popularity of the company’s new E-Class cars.
Increase in the volume of buses sold led to revenue growth
Through this segment the company manufactures and sells buses, bus chassis, coaches, related spare parts and accessories. The segment’s product range comprises city and intercity buses, coaches and bus chassis. The segment reported revenues of US$4.8bn in 2017 in comparison to US$4.5bn in 2016, an increase of 5.6%. This was due in part to a 9.5% increase in the volume of sales which reached 28,700 units in 2017 thanks to demand from Latin America (excluding Mexico) and Brazil.
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