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Daimler seeks 1b euros in savings at Mercedes-Benz by cutting jobs

German carmaker needs to sell more EVs to meet tougher EU emissions rules

Frankfurt

TOUGHER emissions rules will hit Daimler's profits in 2020 and 2021, prompting the German carmaker to seek more than one billion euros (S$1.5 billion) in savings from cutting staff costs at its Mercedes-Benz business by the end of 2022, it said on Thursday. Daimler shares were down 2.3 per cent in early trading at 52.17 euros, the biggest decline on Germany's DAX blue-chip index, which was down 0.3 per cent.

Management positions will be cut by around 10 per cent, and the company said it would also seek more than 300 million euros from cutting personnel costs - plus another 250 million euros in fixed costs - at its trucks business.

Daimler said it needed to sell more electric vehicles to meet tougher European Union rules which force carmakers to cut carbon dioxide emissions from cars by 37.5 per cent by 2030 compared with 2021 levels, and following a 40 per cent cut between 2007 and 2021.

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The company said it expected to achieve a return on sales from operating activities at Mercedes-Benz Cars & Vans of at least 4 per cent in 2020 and at least 6 per cent in 2022. Mercedes-Benz expects car sales to grow by around 3 per cent in 2020. REUTERS