Daimler profits in 3rd quarter despite chip crisis, says 2021 goals on track

Mercedez-Benz parent company, Daimler AG announced a higher quarterly profit despite the 30 per cent fall in the sales unit of Mercedes-Benz due to the global semiconductor shortage. With a focus on its most profitable luxury cars and cost cuts, the automaker said that it should meet its 2021 profit targets, mentioned in a Reuters report. Daimler said that maintained a tight grip on costs during the third quarter as it focused on more profitable models including Maybach and performance AMG brands.

The German automaker shared its quarterly operating profit of about 2.6 billion euros ($3 billion), which is up by 18 per cent from 2.2 billion euros compared to the same period in 2020. However, its revenue slipped to 40.1 billion euros compared to 40.3 billion a year earlier.

The luxury automaker also stated that it is expecting the chip supplies to improve in the fourth quarter, however, added that the chip crisis will continue in 2022 but the status will improve compared to 2021. Earlier in a report, the company had warned the global semiconductor shortage could last till 2023. Chief financial officer Harald Wilhelm said that the chip crisis will continue to be a top priority for the automaker.

Wilhelm also added that Daimler is transferring development and manufacturing activities for compact and midsized combustion-engine transmissions to contract manufacturer and auto parts supplier Magna so that it can focus on electrifying its lineups. “The future of Mercedes is all-electric," he was quoted saying in the report.

The global semiconductor shortage has been plaguing the automotive industry for some time now forcing many auto companies to either slash their production or halt work in the factories.