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EARNINGS

Daimler books record €6-billion profit

German auto and truck giant Daimler, who own Mercedes-Benz, said on Thursday they achieved record sales and profits in 2011, but warned that earnings may be flat this year.

Daimler books record €6-billion profit
Photo: DPA

Daimler said in a statement it booked bottom-line net profit of over €6 billion ($8 billion) in 2011, a leap of 29 percent from the previous year.

That would allow the carmaker to increase the dividend payout to shareholders to €2.2 per share compared with €1.85 in 2010.

Employees would also receive a bonus of €4,100 each. Daimler said its underlying profit, as measured by earnings before interest and tax (EBIT), jumped 20 percent to €8.76 billion.

Unit sales were up 11 percent at 2.111 million cars and revenues grew by 9.0 percent to €106.5 billion, the group said.

“We achieved our best-ever results in 2011 for unit sales, revenue, EBIT and net profit. All of our divisions contributed to this success,” said Daimler head Dieter Zetsche.

The Mercedes-Benz Cars division has “never performed better than in 2011,” and set new records for sales, revenue and underlying profit, he said.

Unit sales of the division’s Mercedes-Benz, Maybach and Smart cars rose by 8.2 percent to 1,381,400 vehicles and revenues were up 7.0 percent at €57.4 billion.

The success was primarily due to higher sales, particularly in the mid-sized and SUV (sports utility vehicle) segments, it said. In terms of region, the car division’s growth was driven mainly by higher sales in China and the United States.

In the trucks division, unit sales were up 20 percent at 425,800 vehicles and revenues up 20 percent at €28.8 billion, with growth seen in all main regions.

In the fourth quarter alone, group net profit soared 57 percent to €1.79 billion and revenues climbed 10 percent to €29 billion.

Looking ahead to the current year, Daimler said that — assuming global industry-wide growth of 4.0 percent, driven primarily by emerging markets in Asia — it expected unit sales to “increase again significantly this year and that revenue will also continue to grow.”

In terms of profits, however, underlying earnings were only expected to match last year’s level, Daimler said.

Investors appeared satisfied with the record earnings and the prospect of an increased dividend and Daimler shares were the strongest gainer on the Frankfurt stock exchange, climbing 4.84 percent to €46.80.

AFP/jcw

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CARS

From lizards to water, eco-bumps snag Tesla’s giant Berlin car factory

In the green forest outside Berlin, a David and Goliath-style battle is playing out between electric carmaker Tesla and environmental campaigners who want to stop its planned "gigafactory".

From lizards to water, eco-bumps snag Tesla's giant Berlin car factory
Tesla's gigafactory outside the doors of Berlin. dpa-Zentralbild | Patrick Pleul

“When I saw on TV that the Tesla factory was going to be built here, I couldn’t believe it,” said Steffen Schorch, driving his trusty German-made car.

The 60-year-old from Erkner village in the Berlin commuter belt has become one of the faces of the fight against the US auto giant’s first European factory, due to open in the Brandenburg region near Berlin in July.

“Tesla needs far too much water, and the region does not have this water,” said the environmental activist, a local representative of the Nabu ecologist campaign group.

Announced in November 2019, Tesla’s gigafactory project was warmly welcomed as an endorsement of the “Made in Germany” quality mark – but was immediately met with opposition from local residents.

Demonstrations, legal action, open letters – residents have done everything in their power to delay the project, supported by powerful
environmental campaign groups Nabu and Gruene Liga.

Tesla was forced to temporarily suspend forest clearing last year after campaigners won an injunction over threats to the habitats of resident lizards and snakes during their winter slumber.

READ MORE: Is Germany’s Volkswagen becoming ‘the new Tesla’ as it ramps up e-vehicle production?

And now they have focused their attention on water consumption – which could reach up to 3.6 million cubic metres a year, or around 30 percent of the region’s available supply, according to the ZDF public broadcaster.

The extra demand could place a huge burden on a region already affected by water shortages and hit by summer droughts for the past three years.

Local residents and environmentalists are also concerned about the impact on the wetlands, an important source of biodiversity in the region.

Tesla Street

“The water situation is bad, and will get worse,” Heiko Baschin, a spokesman for the neighbourhood association IG Freienbrink, told AFP.

Brandenburg’s environment minister Axel Vogel sought to play down the issue, saying in March that “capacity has not been exceeded for now”.

But the authorities admit that “the impact of droughts is significant” and have set up a working group to examine the issue in the long term.

The gigafactory is set to sprawl over 300 hectares – equivalent to approximately 560 football fields – southwest of the German capital.

Tesla is aiming to produce 500,000 electric vehicles a year at the plant, which will also be home to “the largest battery factory in the world”,
according to group boss Elon Musk.

In a little over a year and a half, swathes of coniferous forest have already been cleared to make way for vast concrete rectangles on a red earth base, accessed via the already iconic Tesla Strasse (Tesla Street).

German bureaucracy

The new site still has only provisional construction permits, but Tesla has been authorised by local officials to begin work at its own risk.

Final approval depends on an assessment of the project’s environmental impact – including the issue of water.

In theory, if approval is not granted, Tesla will have to dismantle the entire complex at its own expense.

But “pressure is being exerted (on the regulatory authorities), linked to Tesla’s significant investment”, Gruene Liga’s Michael Greschow told AFP.

In early April, Tesla said it was “irritated” by the slow pace of German bureaucracy, calling for exceptions to the rules for projects that help the environment.

Economy Minister Peter Altmaier agreed in April that his government “had not done enough” to reduce bureaucracy, lauding the gigafactory as a “very important project”.

Despite Germany’s reputation for efficiency, major infrastructure projects are often held up by bureaucracy criticised as excessive by the business community.

Among the most embarrassing examples are Berlin’s new airport which opened last October after an eight-year delay and Stuttgart’s new train station, which has been under construction since 2010.

Brandenburg’s economy minister, Joerg Steinbach, raised the possibility in February that the Tesla factory could be delayed beyond its July planned opening for the same reason.

SEE ALSO: Tesla advertises over 300 jobs for new Gigafactory near Berlin

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