Buses Have Become Important Profitenter for Daimler

According to calculations by the editors of the German journal Automobillwoche the bus production at among others Evobus has become a very important profitcenter for Daimler, together with the van business. The income of these two activities are strongly growing, though not fully compensating the lower revenues of car and truck manufacturing, says the journal. These two activities will add about 1.4 billion Euro to the group’s overall operative income.

 

For long particularly the bus production was an ailing activity, while the vans were pushed between the car and the truck division. But meanwhile Daimler has turned around both activities into highly profitable units, which together gain about a fifth of group’s total operative income. Automobilwoche has calculated that, if business for the rest of the current year continues as in the first six months, the vans could earn this year an EBIT of approx. 900 million Euro. Combined with the earnings of the bus division of about 500 million Euro this would bring a total amount of 1,4 billion Euro. Altogether the group expects an earnings level for this year of about 7 billion Euro EBIT. Initially Daimler expected an annual income for 2008 of more than the 7,7 billion Euro earned in 2007. Daimler expects to sell more vans this year than in 2007, when 289.076 units were produced, both for goods transport and as buses. In the first six months of this year the van production reached 147.300 units. With regard to the buses, Daimler expects to have increased it’s European markets hare from 26 to 30 percent in 2012, while also increasing the Indian and Chinese activities in this segment. From January to July 2008 20.200 buses were produced worldwide. According to calculations by the journal, bus production at Daimler meanwhile has reached a profit margin of nearly 11 percent – which is mainly due to the fact that Daimler worldwide is strong in the sale of bus chassis. According to insiders this is a more profitable business than selling integral buses.

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