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Daimler Q2 earnings lag as cartel allegations loom
[FRANKFURT] Booming sales of new Mercedes-Benz cars pushed up quarterly operating profit at Germany's Daimler by 15 per cent, slightly below consensus and overshadowed by allegations that German carmakers were involved in anti-competitive behaviour.
Daimler's group earnings before interest and tax (EBIT) rose to 3.74 billion euros(S$5.93 billion) in the second quarter, below the average forecast for 3.81 billion euros in a Reuters poll.
Mercedes-Benz Cars sold 595,200 automobiles thanks to a 28 per cent rise in demand in China. Margins improved to 10.2 per cent from 6.4 per cent in the year-earlier period, mainly thanks to sales of a new E-Class limousine.
The Stuttgart-based company lifted the outlook for its trucks and vans divisions, saying it now expected EBIT to reach prior-year levels for both businesses.
But much focus is likely to be on an investigation by European Union and German antitrust regulators into whether Daimler, BMW, VW, Porsche and Audi held meetings to discuss suppliers, prices and standards to the disadvantage of foreign carmakers.
German magazine Der Spiegel reported on Friday that German carmakers colluded to fix the prices of diesel emissions treatment systems using industry committees. Companies found guilty of breaching EU cartel rules face fines of as much as 10 per cent of their global revenue.
The supervisory boards of both Daimler and Volkswagen are due to meet on Wednesday to discuss the matter.
A person familiar with the matter told Reuters on Tuesday that Daimler first raised the issue of collusion with cartel authorities, a move that could earn it immunity.