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Daimler seeks to save over $1.1 bn with job cuts at Mercedes-Benz business

Earlier this year, Daimler had said it hoped to achieve a return on sales of 3% to 5% at Mercedes-Benz Cars

Reuters  |  Frankfurt 


Tougher emissions rules will hit Daimler's profits in 2020 and 2021, prompting the German carmaker to seek more than 1 billion euros ($1.1 billion) in savings from cutting staff costs at its business by the end of 2022, it said on Thursday.

shares were down 2.3% in early trading at 52.17 euros, the biggest decline on Germany's DAX blue-chip index, which was down 0.3%.

Management positions will be cut by around 10%, and 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.

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

The company said it expected to achieve a return on sales from operating activities at Cars & Vans of at least 4% in 2020 and at least 6% in 2022.

expects to grow by around 3% in 2020, but said potential trade tariffs and Brexit could depress the return on sales by up to 1%.

Earlier this year, had said it hoped to achieve a return on sales of 3% to 5% at Mercedes-Benz Cars.

First Published: Thu, November 14 2019. 16:36 IST