Daimler AG spoke about the consequences of the US-China trade disputeJune 21, 2018
In the summer of this year, China will raise the tax on imported goods in response to the US increase. And in the end, the German concern Daimler will suffer. In a press release, the company noted that there is a huge probability of a decline in car sales in 2018.
The states introduced a 25-percent import duty on imported goods from China (amounting to $ 50 billion a year). In response, the Chinese on July 6 will impose an import tax in the same amount on American-made goods.
The company notes that due to the upcoming increase in duties, China will not only reduce the implementation of Mercedes-Benz SUVs, but also increase the costs of this unit. The company can not completely shift these costs to customers, therefore, this state of affairs will greatly affect the profits of Daimler.
Another not unimportant factor, which will be adversely affected by it, is the introduction in Europe of a new eco-standard WLTP (definition of exhaust emissions and energy consumption for various types of drive). Thus, Mercedes-Benz Vans will continue to recall diesel vans, while the demand for Daimler Buses buses in Latin America will drop. What also does not benefit the company.
According to calculations, the EBIT (earnings before interest and taxes) Mercedes-Benz Cars will be slightly less than last year’s figure. While the Vans unit will lose much more than they earned in 2017. The profits of Buses will remain approximately the same as last year, and Daimler as a whole is slightly lower.
In the meantime, Daimler AG is also engaged in the development of electric vehicles. At the beginning of the month, two electric vehicles – Freightliner eCascadia and eM2 106 – were presented.