Daimler continues along its successful path in third quarter - record unit sales and earnings

STUTTGART, Germany, Oct. 21, 2016 /PRNewswire/ --

• Unit sales 5% above prior-year level at 754,100 vehicles
• Revenue up by 4% to €38.6 billion
• Significant increase in Group EBIT to €4,037 million (Q3 2015: €3,661 million)
• Group EBIT adjusted for special items at highest level to date of €4,010 million (Q3 2015: €3,657 million)
• Net profit of €2,726 million (Q3 2015: €2,415 million)
• Good level of free cash flow of industrial business despite special items
• Slight growth in unit sales and revenue at prior-year's level anticipated for full-year 2016
• Group EBIT adjusted for special items still expected to be slightly higher than in 2015
• Dr. Dieter Zetsche, Chairman of the Board of Management of Daimler AG and Head of Mercedes-Benz Cars: "Daimler again posted record earnings in the third quarter. We will make the year 2016 into another successful year for Daimler."
• Bodo Uebber, Member of the Board of Management of Daimler AG for Finance & Controlling and Daimler Financial Services: "We are growing sustainably and profitably. Daimler remains on track to achieve our earnings forecasts for the full year, despite volatile sales and finance markets."

Daimler AG (ticker symbol DAI) posted record unit sales and EBIT adjusted for special items, thus continuing along its successful path. In the third quarter of 2016, Daimler sold 754,100 cars and commercial vehicles worldwide, more than ever before in a third quarter and surpassing the total for the prior-year period by 5%. In the first nine months of the year, the Group's unit sales increased by 6% to 2.2 million vehicles. The Daimler Group's third-quarter revenue amounted to €38.6 billion, which is 4% higher than in the third quarter of 2015. Adjusted for exchange-rate effects, revenue grew by 3%.

The Daimler Group achieved third-quarter EBIT of €4,037 million, thus significantly surpassing its prior-year earnings of €3,661 million. Group EBIT adjusted for special items reached its highest level to date of €4,010 million (Q3 2015: €3,657 million). Net profit improved to €2,726 million (Q3 2015: €2,415 million). Net profit attributable to the shareholders of Daimler AG increased to €2,595 million (Q3 2015: €2,385 million), leading to an increase in earnings per share to €2.43 (Q3 2015: €2.23).

"Daimler again posted record earnings in the third quarter. So we have proven one more time that we are pursuing the right strategy. We will systematically continue along our course," stated Dr. Dieter Zetsche, Chairman of the Board of Management of Daimler AG and Head of Mercedes-Benz Cars. "Our attractive products and innovative services provide us with good momentum. We will use this to utilize the great potential of electric mobility. With our new product brand, EQ, we have established an important basis for leadership also with electric drive systems. But first of all, we will make the year 2016 into another successful year for Daimler."

The EBIT of the Mercedes-Benz Cars division increased significantly, due in particular to growing unit sales in the SUV segment and the market success of the new E-Class. The Mercedes-Benz Vans division also increased its EBIT significantly, as a result of higher revenue. However, Daimler Trucks and Daimler Buses could not match their high earnings of the prior-year quarter. Among other things, this was caused by sharp decreases in unit sales in some key markets. At Daimler Financial Services, earnings increased significantly primarily due to growth in contract volume. Exchange-rate effects had an overall positive effect on operating profit.

The special items in the third quarters of 2016 and 2015 are shown in the table on page 13.

"Due to our global positioning, our attractive products and above all our highly motivated workforce, we are growing sustainably and profitably. Daimler remains on track to achieve our earnings forecasts for the full year, despite volatile sales and finance markets," said Bodo Uebber, Member of the Board of Management of Daimler AG for Finance & Controlling and Daimler Financial Services. "With our strong balance sheet, we have a very good basis to invest substantially in the future areas of digitization and electrification. Despite our financial strength, we also have to remain focused and disciplined. One of the great challenges for the automotive industry will be to optimize and prioritize budgets not only for the ongoing business, but for structural technological developments."

Free cash flow

In the first nine months of 2016, the free cash flow of the industrial business resulted in a cash inflow of €2.6 billion (Q3 2015: €4.8 billion). This decrease was due to different factors. The payment of the fine imposed by the European Commission in the context of the settlement in the truck antitrust proceedings against Daimler AG reduced the free cash flow of the industrial business by €1.0 billion. Furthermore, there were higher tax payments, as the prior-year period was influenced by tax refunds. The free cash flow of the industrial business was also impacted by higher investments in intangible assets and property, plant and equipment. Positive effects resulted from the development of working capital.

Net liquidity

Compared with December 31, 2015, the net liquidity of the industrial business decreased from €18.6 billion to €17.9 billion. The decrease was mainly caused by the dividend payment to the shareholders of Daimler AG, which more than offset the positive free cash flow.

Workforce

At the end of the third quarter of 2016, Daimler employed 284,482 people worldwide (Q3 2015: 286,248; end of 2015: 284,015). Of that total, 172,857 were employed in Germany (Q3 2015: 172,561; end of 2015: 170,454) and 22,145 in the United States (Q3 2015: 24,588; end of 2015: 24,607).

Details of the divisions

Mercedes-Benz Cars' third-quarter unit sales increased by 11% to 565,600 vehicles. The car division thus set another record in the past quarter. In Europe, Mercedes-Benz Cars achieved another high, selling 12% more vehicles than in the prior-year period. Double-digit growth was recorded in the United Kingdom, France, Italy, Spain and Belgium. In Germany, 8% more units of the Mercedes-Benz and smart brands were sold. In China, sales increased by 20% to a record level, and records were set also in Japan (+8%), South Korea (+40%), Australia (+8%) and Taiwan (+13%). Unit sales were higher than ever before in a third quarter also in the NAFTA region. In the United States, sales in the period of July through September rose by 2%.

The largest division's revenue increased by 12% to the best-ever figure of €23.3 billion in the third quarter. Mercedes-Benz Cars' EBIT also increased significantly to €2,746 million – another record (Q3 2015: €2,183 million). Return on sales rose accordingly to 11.8% (Q3 2015: 10.5%). The very positive earnings development was primarily a reflection of growth in unit sales in the SUV segment and the new E-Class. Favorable exchange-rate developments and improved pricing also had a positive impact on EBIT. There were opposing effects from advance expenditure for new technologies and vehicles.

Daimler Trucks sold 97,100 vehicles in the third quarter of this year (Q3 2015: 128,500). The decrease is the result of lower demand for trucks in many key markets. In the NAFTA region, unit sales by Daimler Trucks decreased to 31,400 units in a declining market (Q3 2015: 52,200). At the same time, the division succeeded in further extending its market leadership in Classes 6-8, taking 39.3% of the market (Q3 2015: 38.1%). Daimler Trucks delivered 3,500 units in a contracting market in Brazil, which is fewer than in the third quarter of last year (Q3 2015: 4,300). In the EU30 region (European Union, Switzerland and Norway), sales growth of 7% was achieved to 21,300 units. Daimler Trucks sold more vehicles than in the prior-year period also in Germany (+4%). In Turkey, the truck division was not immune to the difficult conditions and its sales decreased to 1,700 units in the third quarter (Q3 2015: 4,500). The fall in unit sales to 3,300 (Q3 2015: 9,700) vehicles in the Middle East mainly caused the negative development in Asia. In Japan, the region's major market, sales of 11,700 units were at the level of the prior-year quarter. Sales in Indonesia amounted to 6,700 units (Q3 2015: 5,400). The joint venture in China achieved sales growth of 18% with Auman trucks, selling 16,900 vehicles.

The division's revenue decreased from €9.7 billion to €7.9 billion. Daimler Trucks' EBIT of €464 million and return on sales of 5.9% were significantly lower than the high levels of the prior-year period (Q3 2015: €791 million and 8.2%). Negative effects on the division's earnings primarily resulted from lower unit sales in the NAFTA region, Turkey and the Middle East. Earnings were also reduced by intense competition in Europe. The realization of further efficiency improvements and exchange-rate effects had positive effects on earnings. EBIT also includes expenses for workforce adjustments in the context of ongoing optimization programs in Brazil.

Mercedes-Benz Vans increased its unit sales by 13% to the new record of 85,200 vehicles in the third quarter of 2016. In its core region of Western Europe, the van division achieved growth in unit sales of 13%. Strong growth was achieved once again in France (+16%), Spain (+14%) and Italy (+40%). In Germany, the important domestic market, Mercedes-Benz Vans achieved a record in a third quarter (+19%). In Eastern Europe, however, unit sales decreased by 19%; sales in that region were primarily influenced by weak demand in Turkey (-50%) and Russia (-32%). Developments in the NAFTA region were positive once again with an increase of 14%. The market environment in Latin America remained difficult, but unit sales stabilized there (-3%). In China, unit sales more than doubled following the launch of the Vito.  

The division's revenue grew by 13% to €3.1 billion. EBIT increased by 62% to €312 million. Return on sales also increased significantly to 10.0%, compared to 7.0% in the third quarter of last year. The division's EBIT reflects the very positive development of unit sales, especially in Europe, the NAFTA region and China, as well as further efficiency improvements. Exchange-rate effects had a positive effect on earnings.

Third-quarter sales by Daimler Buses decreased by 17% to 6,200 units. In Western Europe, 1,700 buses of the Mercedes-Benz and Setra brands were sold despite supply bottlenecks in the logistics chain (Q3 2015: 1,800). Sales in Germany, the domestic market, improved to 600 units and the division's undisputed market leadership continued. In Turkey, sales were significantly lower than in the third quarter of last year due to the current difficult situation in that country. Also in Latin America (excluding Mexico), the ongoing difficult economic situation in Brazil continued to have a negative impact on demand for bus chassis, so sales of 2,200 units were significantly lower than in the prior-year period (Q3 2015: 3,500). In Mexico, 1,200 units were sold (Q3 2015: 1,200).

The division's revenue of €0.9 billion was lower than in the prior-year period due to the decrease in unit sales (Q3 2015: €1.0 billion). Daimler Buses' EBIT of €45 million was significantly below the very high prior-year level (Q3 2015: €89 million). Return on sales was 4.8% (Q3 2015: 8.7%). The persistently difficult economic situation in Brazil and the associated decline in demand for chassis negatively affected earnings also in the third quarter. In addition, significantly lower unit sales in Turkey due to the uncertain economic situation and cost inflation in Latin America had a negative impact on earnings. However, further efficiency improvements had a positive effect on earnings.

The automotive divisions were also affected by the restructuring of their own dealer network.

At Daimler Financial Services, new business increased also in the third quarter of 2016: Worldwide, approximately 415,000 new leasing and financing contracts were concluded with a total volume of €15.7 billion, an increase of 7% over the prior-year period. Contract volume reached €122.1 billion at the end of September and was 5% above the level of year-end 2015. Adjusted for exchange-rate effects, contract volume grew by 6%. The division's EBIT increased significantly to €438 million (Q3 2015: €378 million) and return on equity rose accordingly. The main reasons for the positive development were the growth in contract volume and a slight improvement in cost of risk. On the other hand, earnings were reduced by negative exchange-rate effects.

The reconciliation of the divisions' EBIT to Group EBIT comprises gains at the corporate level and the effects on earnings of eliminating intra-group transactions between the divisions. Items at the corporate level resulted in income of €39 million in the third quarter of 2016 (Q3 2015: €11 million). The elimination of intra-group transactions resulted in an expense of €7 million (Q3 2015: income of €16 million).

Investment in the future

The Daimler Group invested €1.4 billion in property, plant and equipment in the third quarter of this year (Q3 2015: €1.1 billion). Most of that investment, €1.1 billion, was at the Mercedes-Benz Cars division (Q3 2015: €0.8 billion). The main focus of capital expenditure was on production preparations for new models, in particular the derivatives of the C-Class and the E-Class, as well as investments for new transmissions and engine versions. Another area of capital expenditure was for the ongoing expansion of the international production and component plants. At Daimler Trucks, the main investments were for engines, transmissions and new vehicles, as well as the optimization of the worldwide production network.

The Daimler Group's research and development spending in the third quarter of the year amounted to €1.9 billion (Q3 2015: €1.6 billion), of which €0.6 billion was capitalized (Q3 2015: €0.5 billion). More than two thirds of the research and development spending (€1.4 billion) was at the Mercedes-Benz Cars segment (Q3 2015: €1.2 billion). A substantial proportion of that amount represents advance expenditure for the mobility of the future. The other main areas there, as at Daimler Trucks, were new vehicle models, particularly fuel-efficient and environmentally friendly drive systems, and the intensification of the modular strategy.

Outlook for the markets

At the beginning of the fourth quarter, the fundamental situation of the world economy has not changed; there are no perceptible indications of either acceleration or deceleration of growth. Although moderate expansion can be expected for the fourth quarter, full-year 2016 will probably have the lowest growth rate since the financial crisis, with expansion of global gross domestic product (GDP) of just under 2.5%.

According to recent assessments, worldwide demand for cars is likely to increase from its already high level by about 2% in 2016. Once again, the biggest contribution to this global growth should come from the Chinese market, which is likely to continue expanding at a significant rate. But the expected increase in demand will to a great extent be due to state stimulus. No more growth is expected for the US market for cars and light trucks, and sales volumes there will be slightly below the high level of the previous year. Significant growth is anticipated for the car market of Western Europe. With a view to the individual markets, this growth is continuing on a relatively broad base. Despite the vote in favor of Brexit, current assessments are that the British market will remain at its unusually high level. In Japan, a slight decrease in demand is to be expected following the significant market correction of 2015. Prospects for the major emerging markets remain mixed. In India, market growth is likely to remain solid. In Russia, however, the ongoing difficult economic situation will probably result in another double-digit drop in car sales.

Demand for medium- and heavy-duty trucks in the regions important for Daimler should be perceptibly below the prior-year volume. A major negative factor is the expected significant market contraction in North America. In a comparatively weak overall investment environment, from today's perspective, demand in the market for Classes 6­8 trucks can be expected to decrease by approximately 15%. But the European market has so far proven to be relatively resilient and should continue its recovery with growth of 5-10% in the full year. There is still no turnaround in sight for the Brazilian market; due to the ongoing economic recession, the company has to anticipate further market contraction there in the magnitude of 25%. The situation of the Russian market has meanwhile stabilized somewhat, so it should not contract any further than its very low prior-year level. Demand in China will recover significantly after last year's sharp market contraction. The Japanese market for light-, medium- and heavy-duty trucks continues its solid development and should be close to its level of 2015. The Indonesian truck market is likely to contract once again, however; from today's perspective, Daimler anticipates contraction of approximately 15%. In India, only slight growth is meanwhile expected in the segment of medium- and heavy-duty trucks.

The Group expects significant growth in the markets for mid-size, large and small vans in Western Europe in 2016. Significant growth in demand for large vans is anticipated also in the United States. In Latin America, however, Daimler expects further significant contraction in the market for large vans. In China, significantly lower demand is now anticipated in the market addressed there.

Daimler now expects a significantly larger market volume for buses in Western Europe in 2016 than in 2015. In Brazil, further significant market contraction is anticipated in full-year 2016.

Outlook for the divisions

On the basis of the assumptions presented above on the development of important markets and of the division's current assessments, Daimler expects to slightly increase its total unit sales in the year 2016.

Following the strongest first three quarters of a year for Mercedes-Benz Cars, the division intends to continue its growth in the fourth quarter and thus to significantly increase its unit sales in full-year 2016. This will be primarily driven by the new E-Class sedan, which has made a successful start, as well as by the new wagon version of the E-Class, deliveries of which will start in Europe in October. Sales will be boosted also by the market launch of the GLC Coupe in the United States – a model without a direct predecessor in the product portfolio. The Mercedes-AMG GT R and its convertible version, the Mercedes-AMG GT Roadster, will be available to customers as of the end of the year. This year's model offensive will be concluded with the market launch of the new smart fortwo coupe electric drive in the USA.

Due to negative developments in many truck markets, Daimler Trucks assumes that unit sales in full-year 2016 will be significantly lower than in the previous year. Weaker development of demand for heavy-duty trucks in the NAFTA region will have a significant impact on sales. A significantly weaker sales development is anticipated also in Brazil, in a sharply declining market environment. Increased sales of trucks should be achieved in the EU30 region (European Union, Switzerland and Norway). In Turkey, Daimler Trucks anticipates a significant decrease in unit sales in the full year. This is due to purchases being brought forward to 2015 because of the new emission standard taking effect in 2016, as well as the current economic environment. The low level of oil prices is negatively impacting demand in the Middle East, so a substantial reduction in unit sales is expected in that region. It is assumed that unit sales in the full year will be significantly lower also in Indonesia for market-related reasons. Truck sales in Japan should be at the level of the previous year. In India, unit sales are expected to be slightly higher than in 2015. And additional unit sales will be generated with the expanded range of FUSO trucks produced in India, especially in Asia and Africa.

Mercedes-Benz Vans plans to achieve significant growth in unit sales in 2016. The van division anticipates further significant increases in sales of vans especially in Western Europe, the core market. Significant growth in unit sales is expected also in the NAFTA region. In the context of the division's strategy, »Mercedes-Benz Vans goes global«, following the successful market launch of the V-Class in China in spring 2016, the new Vito was also launched there in September. This will allow further expansion in the market addressed in that country.

Daimler Buses assumes that it will be able to defend its market leadership in its core markets for buses above 8 tons with innovative, high-quality and modern products. However, the bus division anticipates total unit sales in 2016 at slightly below the prior-year level. It is assumed that unit sales in Western Europe will continue to grow at a significant rate. Following the substantial decrease in Brazil in 2015, another significant fall in unit sales is anticipated in 2016. In Mexico, unit sales are now expected to be slightly below the prior-year level.

Daimler Financial Services anticipates slight growth in new business and further growth in contract volume in the year 2016, driven by the growth offensives of the automotive divisions. In addition, the division is utilizing new market potential especially in Asia, and is applying new and digital possibilities for customer contacts – in particular by systematically further developing its online sales channels. Daimler Financial Services continues to see good growth opportunities also in the field of innovative mobility services.

Outlook for the Group

Daimler assumes Group revenue in 2016 in the magnitude of the previous year. Revenue growth is expected in Western Europe and Asia, while revenue in the NAFTA region is likely to be below the prior-year level.

On the basis of the anticipated market development and the assessments of the divisions, Daimler assumes that EBIT adjusted for special items will increase slightly in 2016.

The individual divisions have the following expectations for EBIT adjusted for special items in the year 2016:

– Mercedes-Benz Cars: slightly above the prior-year level,
– Daimler Trucks: significantly below the prior-year level,
– Mercedes-Benz Vans: significantly above the prior-year level,
– Daimler Buses: slightly above the prior-year level, and
– Daimler Financial Services: slightly above the prior-year level.

The anticipated development of earnings in the automotive divisions will have a positive impact on the free cash flow of the industrial business also in 2016. The free cash flow in the year 2015 was significantly affected by extraordinary contributions to the German and American pension-plan assets of €1.2 billion, as well as by the acquisition of a stake in the digital mapping business, HERE, for an amount of €0.7 billion. As the investment offensive in products and technologies will be continued and intensified, the free cash flow of the industrial business adjusted for special items should be significantly lower in 2016 than the comparable amount of €5.9 billion in 2015. Daimler assumes, however, that it will be significantly higher than the dividend distribution in the year 2016.

In order to achieve its ambitious growth targets, Daimler will once again significantly increase its already very high investment in property, plant and equipment in the year 2016 (2015: €5.1 billion). In addition to capital expenditure, the Group is developing its position in the emerging markets by means of targeted financial investments in joint ventures and equity interests.

With its research and development activities, Daimler anticipates a total volume significantly above the previous year's spending of €6.6 billion. Key projects at Mercedes-Benz Cars include successor models for the current compact class, the GLS and GLE SUVs, and the S-Class. In addition, the Group is investing in the automotive divisions in new, low-emission and fuel-efficient engines, alternative drive systems, autonomous driving and the connected and digital user interface. Key projects at Daimler Trucks include the development of tailored products and technologies for the Brazilian market and for the FUSO product portfolio.

From today's perspective, we assume that the size of the worldwide workforce will be at the level of year-end 2015.

Other important events

The Supervisory Board of Daimler AG has appointed Britta Seeger as a member of the Board of Management, effective as of January 1, 2017. Britta Seeger will be responsible for Mercedes-Benz Cars Marketing and Sales, succeeding to Ola Källenius, who at the same time will assume responsibility for Group Research and Mercedes-Benz Cars Development. Britta Seeger is currently President & CEO of Mercedes-Benz Türk A.S. The Supervisory Board has extended the contract of service of Wilfried Porth as Board of Management member for Human Resources and Labor Relations Director, IT & Mercedes-Benz Vans by five years until April 30, 2022.

At the Paris Motor Show, Mercedes-Benz presented its new product brand for electric mobility: EQ. The name EQ stands for »Electric Intelligence« and is derived from the Mercedes-Benz brand values »Emotion and Intelligence«. The new brand includes all the key aspects for customer-oriented electric mobility and goes beyond the car itself. EQ offers a comprehensive electric-mobility ecosystem consisting of products, services, technologies and innovations. The spectrum reaches from electric vehicles to wallboxes and charging services and to home energy storage. A precursor of the new brand is the EQ showcar, which is close to a series version and had its world premiere in Paris. Before the end of this decade, the first EQ series-produced model will be launched in the SUV segment. This will be followed by a model offensive that will gradually supplement the Mercedes-Benz Cars portfolio with electrified vehicles.

Daimler Financial Services is making strategic investments in the fleet-management business and is acquiring 100% ownership of Athlon Car Lease International B.V., a subsidiary of the Dutch Rabobank Group. Athlon's portfolio will be merged with that of Daimler Fleet Management under the Athlon brand. This will create one of the leading providers in the European fleet-management business with a portfolio of approximately 340,000 cars and vans. The transaction is awaiting the required approvals from antitrust and other regulatory authorities, and is likely to be closed in the fourth quarter of 2016.

Daimler has made the final decision on a new engine plant in Jawor, Poland, and has signed a contract to acquire land there together with its Polish partners in mid October. The engines will be produced under the roof of the newly established company »Mercedes-Benz Manufacturing Poland« (MBMP). Investment of approximately €500 million is planned in the new engine production in Jawor, which is approximately 70 kilometers west of Wroclaw. Jawor is Mercedes-Benz Cars' first production facility in Poland. The high-tech factory will produce four-cylinder engines for Mercedes-Benz automobiles. Start of production at the new Daimler site is planned for the year 2019 and construction is to commence in 2017.

The worldwide car-sharing community of car2go continues to grow: In September, the company passed the mark of two million customers. The car-sharing provider, a subsidiary of Daimler AG, has thus extended its market leadership in Germany, Europe and the world. The two million customers worldwide include 1.1 million in Europe, thereof more than 550,000 in Germany. Within one year, the number of car2go customers has increased by 43%, demonstrating the rapid growth in the fully flexible car-sharing business. One of the 14,000 car2go vehicles worldwide is rented every 1.5 seconds.

Daimler Financial Services is the world's largest financer of commercial vehicles: Approximately 940,000 commercial vehicles worth some €34 billion are on the road with a leasing, financing or rental contract from Daimler's finance division. This represents an increase of 8% compared with a year earlier. More than half of the contracts are in the European market. In Germany, over 250,000 or more than 50% of the commercial vehicles with the three-pointed star are financed through Mercedes-Benz Bank.

The Daimler commercial-vehicle brands underscored their leading role for connectivity, efficiency and safety with a large number of new products and services at the 66th IAA Commercial Vehicles trade fair in Hannover in September. Mercedes-Benz Urban eTruck, Future Bus and Vision Van provided an outlook onto the future of the transportation industry at the IAA. Daimler Trucks is pushing forward with the systematic connectivity of its vehicles with all parties involved in the logistics and transport process. The fully connected truck will lead to a radical transformation, making the transportation of goods by road even more effective and efficient – not only for drivers, haulage companies and truck manufacturers, but also for society as a whole. In the next five years alone, the company will invest about €0.5 billion in the connectivity of its trucks and the creation of related services and digital solutions.

The following table summarizes the special items that affected EBIT in the third quarters of 2016 and 2015:

Further information from Daimler is available at: www.media.daimler.com and www.daimler.com

Forward-looking statements:
This document contains forward-looking statements that reflect our current views about future events. The words "anticipate," "assume," "believe," "estimate," "expect," "intend," "may," "can," "could," "plan," "project," "should" and similar expressions are used to identify forward-looking statements. These statements are subject to many risks and uncertainties, including an adverse development of global economic conditions, in particular a decline of demand in our most important markets, a deterioration of our refinancing possibilities on the credit and financial markets; events of force majeure including natural disasters, acts of terrorism, political unrest, armed conflicts, industrial accidents and their effects on our sales, purchasing, production or financial services activities; changes in currency exchange rates; a shift in consumer preferences towards smaller, lower-margin vehicles; a possible lack of acceptance of our products or services which limits our ability to achieve prices and adequately utilize our production capacities; price increases for fuel or raw materials; disruption of production due to shortages of materials, labor strikes or supplier insolvencies; a decline in resale prices of used vehicles; the effective implementation of cost-reduction and efficiency-optimization measures; the business outlook for companies in which we hold a significant equity interest; the successful implementation of strategic cooperations and joint ventures; changes in laws, regulations and government policies, particularly those relating to vehicle emissions, fuel economy and safety; the resolution of pending government investigations or of investigations requested by governments and the conclusion of pending or threatened future legal proceedings; and other risks and uncertainties, some of which we describe under the heading "Risk and Opportunity Report" in the current Annual Report. If any of these risks and uncertainties materializes or if the assumptions underlying any of our forward-looking statements prove to be incorrect, the actual results may be materially different from those we express or imply by such statements. We do not intend or assume any obligation to update these forward-looking statements since they are based solely on the circumstances at the date of publication.

Daimler at a Glance
Daimler AG is one of the world's most successful automotive companies. With its divisions Mercedes-Benz Cars, Daimler Trucks, Mercedes-Benz Vans, Daimler Buses and Daimler Financial Services, the Daimler Group is one of the biggest producers of premium cars and the world's biggest manufacturer of commercial vehicles with a global reach. Daimler Financial Services provides financing, leasing, fleet management, insurance, financial investments, credit cards, and innovative mobility services.

The company's founders, Gottlieb Daimler and Carl Benz, made history with the invention of the automobile in the year 1886. As a pioneer of automotive engineering, Daimler continues to shape the future of mobility today:

The Group's focus is on innovative and green technologies as well as on safe and superior automobiles that appeal and fascinate. Daimler consequently invests in the development of alternative drive trains with the long-term goal of emission-free driving: from hybrid vehicles to electric vehicles powered by battery or fuel cell. Furthermore, the company follows a consistent path towards accident-free driving and intelligent connectivity all the way to autonomous driving. This is just one example of how Daimler willingly accepts the challenge of meeting its responsibility towards society and the environment.

Daimler sells its vehicles and services in nearly all the countries of the world and has production facilities in Europe, North and South America, Asia, and Africa. Its current brand portfolio includes, in addition to the world's most valuable premium automotive brand, Mercedes-Benz, as well as Mercedes-AMG, Mercedes-Maybach and Mercedes me, the brands smart, Freightliner, Western Star, BharatBenz, FUSO, Setra and Thomas Built Buses, and Daimler Financial Services' brands: Mercedes-Benz Bank, Mercedes-Benz Financial, Daimler Truck Financial, moovel, car2go and mytaxi. The company is listed on the stock exchanges of Frankfurt and Stuttgart (stock exchange symbol DAI). In 2015, the Group sold around 2.9 million vehicles and employed a workforce of 284,015 people; revenue totalled €149.5 billion and EBIT amounted to €13.2 billion.

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