Amidst sluggish global auto sales, Daimler has announced over $1 billion in job cuts over the next three years citing the costs of moving the company towards electric cars and to meet EU emissions targets.
Crux of the Matter
CEO Mr Källenius outlined his restructuring plans for Daimler, which includes a cap on investment and research and development at Mercedes Cars, as well as job cuts across the group.
10% of management positions will be cut at the Mercedes unit and as well as a number of “indirect” administrative roles, will be eliminated.
The company aims to have plug-ins and full electrics in over 50% of Mercedes-Benz car sales by 2030.
It is expected to reduce costs by more than 1 billion euros. The trucks unit will save 300 million euros in Europe.
Along with the heavy investments in this shift, the upcoming Brexit is also a matter of concern.
CEO Ola Källenius said that the company’s metamorphosis will have a “negative impact” on earnings in 2020 and 2021.
Curiopedia
Daimler AG is a German multinational automotive corporation, headquartered in Stuttgart, Baden-Württemberg. Daimler-Benz was formed with the merger of Benz & Cie and Daimler Motoren Gesellschaft in 1926. The company was renamed DaimlerChrysler upon acquiring the American automobile manufacturer Chrysler Corporation in 1998 and was again renamed Daimler upon divesting of Chrysler in 2007. In 2017, Daimler sold 3.3 million vehicles. By unit sales, Daimler is the thirteenth-largest car manufacturer and is the largest truck manufacturer in the world. More Info
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