Finance

Finance

German carmaker reports a loss

17 February 2009 16:20 (UTC +04:00)

Bakuâ€“ APA-Economics. Daimler AG, the worldâ€™s second- biggest maker of luxury cars, reported its first quarterly loss since 2007 on declining sales and costs from Chrysler LLC and said the recession will burden earnings further this year, Bloomberg reports.
The fourth-quarter loss was 1.53 billion euros ($1.93 billion) compared with year-earlier net income of 1.7 billion euros, Stuttgart, Germany-based Daimler said in a statement today. Expenses from Chrysler, in which the company retains a 20 percent stake, wiped 2.01 billion euros from earnings.
Daimler suffered as the European economy contracted the most in 13 years in the quarter, helping to push revenue down 12 percent to 23.2 billion euros. Car sales in Europe plunged 27 percent to the lowest in two decades last month and contracted 37 percent to a 28-year low in the U.S., a key market for the companyâ€™s Mercedes-Benz luxury division.
Daimler fell as much as 7.4 percent to 21.82 euros in Frankfurt and was down 3.4 percent at 22.75 euros as of 3:11 p.m. local time. The stock has fallen 15 percent this year, valuing the carmaker 21.9 billion euros.
The loss was Daimlerâ€™s first since the third quarter of 2007, when earnings were wiped out by 2.6 billion euros in costs from the sale of 80.1 percent of Chrysler. The U.S. carmakerâ€™s burden on fourth-quarter earnings included a charge of 1.67 billion euros to write off the value of loans and other assets.
Daimler is the first German carmaker to report figures for the final three months of 2008. Turin, Italy-based Fiat SpA said Jan. 22 that fourth-quarter profit fell 71 percent to 163 million euros. Paris-based PSA Peugeot Citroen, Franceâ€™s biggest carmaker, reported a second-half loss of 1.08 billion euros and rival Renault SA revealed a 982 million-euro loss a week ago.
Wolfsburg, Germany-based Volkswagen AG, Europeâ€™s biggest carmaker, will publish results on March 11 and Munich-based Bayerische Motoren Werke AG reports on March 18. BMW, the worldâ€™s largest maker of luxury cars, said on Feb. 6 that it will publish â€œclearly positiveâ€ 2008 earnings.