Outlook

August 05, 2020 - Daimler expects both Group EBIT and the free cash flow of the industrial business to be positive in 2020, but lower than in the previous year.

Assuming that the economic recovery continues in the second half of the year and that there is no new major wave of COVID-19 infections in our key sales markets, Daimler expects both Group EBIT and the free cash flow of the industrial business to be positive in 2020, but lower than in the previous year. The free cash flow of the industrial business does not take into account possible expenses in connection with legal and governmental proceedings.

Group

On the basis of our assumptions for the development of the markets important for us and of the divisions’ current ssessments, Daimler expects its total unit sales in 2020 to be below the magnitude of the previous year.

In view of declining unit sales due to the covid-19 pandemic, we assume that Group revenue in full-year 2020 will also be lower than in the previous year.

Assuming that the economic recovery continues in the second half of the year and that there is no new significant wave of covid-19 infections in our key sales markets, we expect both Group EBIT and the free cash flow of the industrial business to be positive in 2020, but lower than in the previous year. The free cash flow of the industrial business does not take into account possible expenses in connection with legal and governmental proceedings.

Divisions

Due to the far-reaching effects of the coronavirus, Mercedes-Benz Cars anticipates unit sales in full-year 2020 below the level of the previous year. This assessment also reflects the complete changeover of the smart brand to all-electric models. Mercedes-Benz Cars intends to launch a total of about ten new or updated models in 2020, which will further rejuvenate the product portfolio and extend it in particular with electrified models. We expect positive sales impetus from the ongoing popularity of our SUVs, such as the GLB, GLE and GLS models launched last year.

As the EBIT of the Mercedes-Benz Cars & Vans division was adversely affected by substantial special items in 2019, we anticipate EBIT for this division above the prior-year level despite the effects of the covid-19 pandemic.

At Mercedes-Benz Vans, unit sales in 2020 are likely to be below the prior-year level, primarily due to the effects of the coronavirus.

As the EBIT of the Mercedes-Benz Cars & Vans division was adversely affected by substantial special items in 2019, we anticipate EBIT for this division above the prior-year level despite the effects of the covid-19 pandemic.

In addition to the already expected normalization of our core truck markets, the covid-19 pandemic will lead to further customer restraint, resulting in lower worldwide unit sales for Daimler Trucks in full-year 2020.

Daimler Buses also anticipates decreasing unit sales in 2020. As before, however, Daimler Buses expects to maintain its market leadership in its most important traditional core markets for buses above eight tons.

Due to the effects of the covid-19 pandemic and the resulting lower unit sales by our automotive divisions, Daimler obility anticipates a decrease in new business and a reduced contract volume in full-year 2020.

We do not expect the adjusted return on equity of Daimler Mobility to reach the prior-year level.

Investment

The focus of investment in property, plant and equipment at the Mercedes-Benz Cars & Vans division is on the successor models of the S-Class and C-Class. In addition, we continue to plan high investments for electric mobility. Daimler Trucks & Buses will invest primarily in future projects and successor generations for existing products, global engine and transmission projects, and the optimization of the worldwide production and sales network.

At Mercedes-Benz Cars & Vans, a large part of the expenditure for research and development activities will be for the renewal of the product portfolio. The most important individual projects here are the S-Class and the C-Class, as well as the expansion of the model range of the EQ product and technology brand. We are also working hard on new, low-emission combustion engines, electric mobility, vehicle connectivity and innovative safety technologies for automated and autonomous driving. Despite covid-19-related reductions in the development budget, the topics of automated driving, electric mobility and connectivity play an important role at Daimler Trucks & Buses. Other key areas are successor generations for existing products, fuel efficiency and reduced emissions, as well as customized products and technologies for important growth markets.

This page was revised based on the second-quarter 2020 interim report and contains forward-looking statements.

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