Mercedes 2012 Annual Report Download - page 233

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29. Guarantees and other financial commitments
Guarantees. Table  7.68 shows the amounts of provisions
and liabilities at December 31 which have been established
by the Group in connection with its issued guarantees (excluding
product warranties).
Financial guarantees. Financial guarantees principally represent
contractual arrangements. These guarantees generally provide
that in the event of default or non-payment by the primary
debtor, the Group will be required to settle such financial obliga-
tions. The maximum potential obligation resulting from these
guarantees amounted to €968 million at December 31, 2012
(December 31, 2011: €1,367 million). The previous year’s figure
includes a guarantee of payment to the Chrysler pension plans,
whose term expired in August 2012. These amounts include
guarantees, which the Group issued for the benefit of Chrysler
in connection with the Chrysler transactions entered into
in 2007 and 2009. At December 31, 2012, these guarantees
amounted to €0.3 billion. For a portion of these financial
guarantees, Chrysler provided collateral of €0.2 billion to an
escrow account.
Guarantees under buyback commitments. Guarantees
under buyback commitments represent arrangements whereby
the Group guarantees specified trade-in or resale values for
sold vehicles. Such guarantees provide the holder with the
right to return purchased vehicles to the Group, the right being
primarily contingent on the future purchase of vehicles or
services. Residual value guarantees related to arrangements
for which revenue recognition is precluded due to the Group’s
obligation to repurchase assets sold to unrelated guaranteed
parties are not included in those amounts.
Other guarantees. Other guarantees principally comprise
pledges or indemnifications related to the quality or timing
of performance by third parties or participations in perfor-
mance guarantees of consortiums. As of December 31, 2012,
the best estimate for obligations under other guarantees
for which no provisions had yet been recorded was €35 million
(2011: €41 million).
In 2002, our subsidiary Daimler Financial Services AG,
Deutsche Telekom AG and Compagnie Financière et Industrielle
des Autoroutes S.A. (Cofiroute) entered into a consortium
agreement in order to jointly develop, install, and operate under
a contract with the Federal Republic of Germany (operating
agreement) a system for the electronic collection of tolls for
all commercial vehicles over 12 tons GVW using German high-
ways. Daimler Financial Services AG and Deutsche Telekom AG
each hold a 45% equity interest and Cofiroute holds the
remaining 10% equity interest in both the consortium (Toll Collect
GbR) and the joint venture company (Toll Collect GmbH)
(together Toll Collect).
According to the operating agreement, the toll collection
system had to be operational no later than August 31, 2003.
After a delay of the launch date of the toll collection system,
which resulted in a loss of revenue for Toll Collect and in pay-
ments of contractual penalties for delays, the toll collection
system was introduced on January 1, 2005 with on-board units
that allowed for slightly less than full technical performance
in accordance with the technical specification (phase 1).
On January 1, 2006, the toll collection system was installed and
started to operate with full effectiveness as specified in the
operating agreement (phase 2). On December 20, 2005, Toll
Collect GmbH received a preliminary operating permit as
specified in the operating agreement. Toll Collect GmbH expects
to receive the final operating permit, and continues to operate
the toll collection system under the preliminary operating permit
in the interim.
Failure to perform various obligations under the operating
agreement may result in penalties, additional revenue reductions
and damage claims that could become significant over time.
However, penalties and revenue reductions are capped at €150
million per year until the final operating permit has been issued
and at €100 million per year following the issuance of the
final operating permit. These cap amounts are subject to a 3%
increase for every year of operation.
Provisions and liabilities recognized in connection with guarantees
At December 31,
2012 2011
In millions of euros
Financial guarantees 111 249
Guarantees under buyback commitments 115 44
Other guarantees 141 132
367 425
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