Daimler posts $1.51 billion loss

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Daimler posts $1.51 billion loss

Posted Wednesday, Jul 29, 2009, 1:18 pm in Employee News

Germany’s Daimler AG said Wednesday that it lost 1.06 billion euro ($1.51 billion) in the second quarter as the recession hurt car and truck sales, and the company took charges related to its stake in Chrysler, the Associated Press reported.

The company’s highly cyclical truck business—the world’s largest by sales—saw unit sales plunge 60 percent, the AP said. But the quarterly result was better than analyst predictions, and the company’s shares rose, the story said.

According to the AP, the loss in the April-June period compared with a profit of nearly 1.3 billion euro a year earlier. Analysts surveyed by Thomson Reuters had expected a net loss of 1.5 billion euro.

Despite the third quarterly loss in a row, the company predicted a “gradual improvement” in its operating profit in the coming months, the news service said. The news helped push Daimler shares up nearly 5.4 percent to 31.68 euro in Frankfurt trading.

Sales fell 25 percent to 19.6 billion euro in the quarter compared with 26 billion euro last year, below the 20 billion euro that analysts had forecast, a stark reminder of the bleak landscape that car makers worldwide face amid the economic crisis, the AP said.

Other factors that weighed on its earnings included Daimler’s relinquishing a 19.9 percent equity stake in Chrysler Group LLC effective June 3, the news service said. Daimler will take 387 million euros in expenses related to the stake during the second quarter, the story said. (Associated Press/Detroit News)