Mercedes 2009 Annual Report Download - page 97

Management Report |Liquidity and Capital Resources |93
Other financial commitments and off-balance-sheet
transactions
In the context of its normal business operations, the Group has
entered into other financial commitments in addition to the
liabilities shown in the consolidated balance sheet at December
31, 2009. These other financial commitments primarily relate
to purchasing commitments and commitments to invest in plant
replacement and expansion. The Group has also committed to
lease payments in connection with rental and leasing agreements.
In addition, particularly Daimler Financial Services has made
irrevocable loan commitments within the framework of its busi-
ness operations. The table below provides an overview of these
other financial commitments and their maturities:
1
1,117
-
15
427
-
422
524
852
4,025
304
735
4,463
2,372
1,587
Purchasing agreements, purchase or investments in property, plant and equipment
Future lease payments under rental and leasing agreements
Irrevocable loan commitments
Payments falling due
after
5 years
between
4 and 5 years
between
1 and 3 years
within
1 yearTotal
in millions of €
The Group’s off-balance-sheet transactions relate to trans-
actions in the context of which Daimler provided guarantees and
thus continues to be subject to risk. However, this does not
include warranties the Group provides on its products in the con-
text of its vehicle sales.
The guarantees reported by the Group (excluding product war-
ranties) principally represent financial guarantees that require us
to make certain payments if a guarantee holder fails to meet its
financial obligations. The maximum potential obligation resulting
from these guarantees amounted to €1.5 billion at December 31,
2009 (2008: €1.9 billion); the corresponding provisions amounted
to €0.2 billion at the end of the year (2008: €0.3 billion).
Most of the financial guarantees relate to the situations described
as follows: In connection with the transfer of a majority inter-
est in Chrysler in 2007, Daimler guaranteed payments of up to
US $1 billion into the Chrysler pension plans; this guarantee
was reduced to US $200 million in 2009. The Group also provided
guarantees for other Chrysler obligations; at December 31, 2009,
these guarantees amounted to €0.3 billion, whereby Chrysler pro-
vided €0.2 billion on an escrow account as collateral for the
guaranteed obligations. Another financial guarantee of €0.1 billion
relates to bank loans of Toll Collect GmbH, the operator company
of the toll-collection system for trucks in Germany. Other risks arise
from an additional guarantee that the Group provided for obli-
gations of Toll Collect GmbH towards the Federal Republic of
Germany. This guarantee is related to the completion and
operation of the toll-collection system. A claim on this guaran-
tee could primarily arise if for technical reasons toll revenue is
lost or if certain contractually defined parameters are not ful-
filled, if the Federal Republic of Germany makes additional claims,
or if the final operating permit is not granted. Furthermore,
arbitration proceedings have been initiated against the Group. The
maximum obligation that could result from this guarantee is
substantial, but cannot be reasonably estimated.
Furthermore, the Group has issued a number of smaller guaran-
tees, some of which specify that Daimler guarantees the financial
obligations of companies which supply us with parts or services
or which lease production facilities to us.
Agreements whereby we guarantee specified trade-in or resale
values for sold vehicles result in guarantees under buy-back
commitments for the Group. Most of these guarantees provide
the holder with the right to return purchased vehicles to the
Group if the customer acquires another vehicle from Daimler. At
December 31, 2009, the maximum potential obligation from
these guarantees amounted to €0.7 billion (2008: €0.7 billion);
the corresponding provisions amounted to €0.1 billion at the
end of 2009 (2008: €0.1 billion).