Mercedes Expects Lower Earnings This Year
Direct sales planned in some markets to help cut costs.
Mercedes S Class one of higher-end lines that have shored up its bottom line.
IMAGE: Mercedes-Benz
Mercedes-Benz Group forecasted an earnings drop this year due to uncertain greater economic conditions, and it will aim for more direct sales in some large markets for maximized margins.
The German carmaker foresees a lower adjusted sales return of 12% to 14% in its cars division, plus group earnings under that of last year.
The luxury brand stalwart is taking into account diminished European demand, continued semiconductor shortage, inflation, high raw-material and energy prices, and China’s gradual pandemic recovery.
Mercedes said it expects its higher-end model sales to increase a small amount this year, continuing a trend of that share of business shoring it up against higher costs.
The brand plans to shift to direct sales in some European markets, including Britain and Germany, in order to save on costs and eliminate consumer concerns that they might find better prices at another dealer, Reuters reported.
Chief Executive Ola Kaellenius said, "You turn yourself from a wholesaler into a retailer. It changes your whole attitude in how you run the business."
Originally posted on Auto Dealer Today
More Industry
Pennsylvania Dealership Under New Retailers
The sale of the Chrysler Dodge Jeep Ram store puts a family auto group on a leaner path as first-time dealers take the helm.
Read More →
Battery Storage Takes Priority Over EVs
U.S. automakers are prioritizing battery energy stationary storage over electric-vehicle production as the consumer demand for EVs lags the rest of the world.
Read More →
Auto Dealers Feel Better But Not Great
A second-quarter Cox Automotive poll of franchised retailers and independents found better views of the current market after a good spring but anticipation of third-quarter storminess.
Read More →
New-Vehicle Sales Picture Relative
A May forecast is complicated by last spring’s trade tariff effects on auto retail. Despite continued hard realities, many consumers took advantage of ways to bite the bullet.
Read More →
Auto Group Acquires Third Nissan Rooftop
Iowa-based Coleman Automotive Group recently acquired its seventh dealership, McGrath Nissan, which it renamed Nissan of Elgin.
Read More →
April Less Affordable
Based on prices, reduced incentives and slower household income growth, consumers found it more challenging to buy new last month, Cox Automotive reported.
Read More →
Building an Extraordinary F&I Agency
Work to determine your specialized talent, because that fact will determine everything about your agency’s future.
Read More →
Recipe for Compliance
The secret to both amazing barbecue and compliance is the same: understanding the basics and committing to a process.
Read More →
EVs Getting More Attractive
A growing percentage of U.S. consumers are open to switching and fewer are adverse to the idea, according to a recently completed survey. That’s despite the end of a tax break.
Read More →
EV Sales Drop in April Following Surge
North American electric-vehicle sales were down 28% year-over-year, a sharp contrast from global EV sales growth of 6%.
Read More →