German luxury automaker Mercedes-Benz reported a 64% decline in third-quarter earnings in its main car division, falling well short of analysts' expectations as Chinese consumers scaled back on luxury spending amid economic challenges.
"The Q3 results fall short of our ambitions," CFO Harald Wilhelm commented, noting the company plans to intensify cost-cutting measures.
Earnings from July to September were impacted by costs associated with model updates and a challenging market, particularly for the new G-Class SUV versions scheduled for next quarter, Mercedes stated.
One positive in the report was the industrial business’s continued cash flow, which rose 2% year-on-year to 2.39 billion euros ($2.59 billion). However, adjusted earnings before interest and taxes (EBIT) in the car division fell to 1.2 billion euros, significantly missing LSEG's projection of a 3.6% drop to 3.19 billion euros.
CEO Ola Kaellenius cautioned that Chinese consumers remain wary of large purchases due to prolonged economic weakness and a domestic real estate crisis. Mercedes-Benz reduced its full-year profit margin target twice in the third quarter, joining other European automakers attributing decreased profits and margins to China’s slowing car market.
These results come amid ongoing discussions between the EU and China over potential tariffs on Chinese EV imports.
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Russian President Vladimir Putin has said that he thinks there is a chance of a peace being reached with Ukraine. He told the Eastern Economic Forum in Vladivostok, Russia that he believed there was "a chance of finding a solution," to the conflict.
The Iranian Health Ministry said at least 18 people were killed and 142 others injured in U.S. airstrikes carried out between 30 August and 2 September.
The European Union's foreign policy chief Kaia Kallas says the bloc will tighten enforcement of sanctions against Russia over its war in Ukraine. EU foreign ministers were meeting in Ireland following renewed Russian strikes on cities across Ukraine.
Start your day informed with the AnewZ Morning Brief. Here are the top stories for the 3rd of September, covering the latest developments.
U.S. negotiators Steve Witkoff and Jared Kushner will visit Russia then Ukraine over the weekend, Russian state news agency TASS has reported, citing an unnamed source. Ukrainian President Volodymyr Zelenskyy has also said American envoys will visit the capitals of both countries.
Volkswagen’s supervisory board has approved a major overhaul aimed at cutting 100,000 jobs by 2030 as the German carmaker battles weaker sales, falling profits and intensifying global competition.
Chinese Premier Li Qiang has called on American companies to expand their presence in China and pledged that Beijing would address their "reasonable concerns," as China looks to stabilise trade ties with Washington ahead of President Xi Jinping's planned visit to the U.S. later this month
Apple is entering a new era as Tim Cook steps down as chief executive after 15 years at the helm, handing the technology giant's leadership to longtime executive John Ternus.
Volkswagen is heading towards a decisive showdown with labour representatives as Germany's largest carmaker weighs sweeping restructuring measures that could lead to factory closures and tens of thousands of job losses.
Online fast-fashion retailer Shein is seeking to raise up to $1.77 billion in a Hong Kong IPO after its valuation fell around 70 per cent from its private-market peak four years ago.
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