Renault, Daimler show early signs of recovery
October 23, 2020
Two of Europe's leading car manufacturers released their third quarter reports on Friday morning with both showing early signs of recovery following a disastrous second quarter.
The global automobile market saw an upward trend from a 28% decline in the first half of the year to a mere 4% drop in the third quarter.
Read more: Germany's car industry struggles with transformation amid coronavirus crisis
The French Renault Group and the German Daimler-Benz both revealed figures showing a worse situation than in 2019 with regards to sales and revenue, but with significantly better numbers than the first half of 2020 during the peak of the coronavirus crisis.
In its third quarterly report of the year, Renault announced group revenues of €10.4 billion ($12.2 billion), down 8.2% on the previous year. Sales figures were slightly better with 806,320 units sold, down only 6.1% from the same period in 2019.
The brand did particularly well in Europe with 2.9% fewer units sold in a market down 5%. Renault also saw a significant increase in electric vehicle sales with sales of its flagship ZOE car up 157%, equivalent to over 27,000 units.
Daimler expecting to turn a profit in 2020
The Daimler-Benz group also saw an upward trend leading the company to forecast a profit by the end of the year. While sales and revenues remained below the 2019 figures, they were up from the first half of the year and the company's earnings before interest and taxes (EBIT) even surpassed the 2019 equivalent.
However, the EBIT in 2019 was particularly low, already then down 60%, due to a weak automobile market and the legal fallout from the diesel emissions scandal.
Operating profit for the company increased by 14% to €3.07 billion thanks to strong sales in China and lowered costs. Daimler expected similar results for the fourth quarter which would lead to a return on sales of between 4.5 and 5.5%.
"With this momentum, we are on the right track to make our business more airtight," explained CFO Harald Wilhelm. "The transformation of Daimler, however, is a long-distance race. We're keeping the pace with great focus and discipline."
The company's restructuring and downsizing efforts also continue. Wilhelm said that almost 2,000 employees had agreed to the voluntary separation program which Daimler has introduced in a bid to limit the number of jobs it unilaterally cuts.
New commercial vehicles hit the road
The market for commercial vehicles also showed a strong rebound according to the European Automobile Manufacturers Association. Across the EU new vehicle registrations were up 13.3% on the previous September figures, with particularly strong growth in Italy (17.8%), Germany (17.6%) and France (15.1%).
ab/msh (dpa, Reuters)