Mercedes 2013 Annual Report Download - page 141

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C | Combined Management Report | Outlook
With its “DFS 2020” strategy, Daimler Financial Services
aims to achieve further profitable growth in the coming years.
For the year 2014, we anticipate significant growth in new
business and contract volume. Important growth drivers are
the product offensives of the automotive divisions, the
addressing of younger customers as a new target group, the
expansion of business especially in Asia, the further devel-
opment of our online sales channels and the development of
innovative mobility offers. In addition to car2go, we will
systematically expand our range of mobility services. Two
examples of this are the “moovel” mobility platform and
the “Park2gether” online service for finding parking spaces.
On the basis of our assumptions concerning the development
of automotive markets and the divisions’ planning, we
expect the Daimler Group to achieve further significant
growth in total unit sales in 2014.
Revenue and earnings
We assume that the Daimler Group’s revenue will grow
significantly in 2014. Although there is still great uncertainty
regarding the future development of our markets, we can
assume that demand will generally increase. Another positive
factor is that we should profit from the numerous new
models that we launched in all of our automotive divisions
in 2012 and 2013. The new models of the year 2014 will
additionally stimulate demand, for example the new C-Class
and the new GLA compact SUV at Mercedes-Benz Cars.
Furthermore, we are increasingly developing the growth markets
of Asia, Eastern Europe and Latin America for our products
– partially also through local production. The revenue growth
we anticipate is likely to be driven by all divisions, whereby
Daimler Trucks and Mercedes-Benz Cars will probably deliver
the biggest contributions in absolute terms. In regional
terms, we expect to achieve above-average growth rates
in the emerging markets and in North America.
The following factors are particularly important for the
earnings situation of the Daimler Group in 2014:
– Due to our Group-wide product offensive, we are starting
the year 2014 in all automotive divisions with a large number
of new and attractive products and new technologies.
This will enable us to convince our customers also in difficult
markets.
– In order to focus our activities even more sharply on our
customers and markets, we decided in September 2013
to strengthen the organization of the divisions. Under the
heading of “Customer Dedication,” we are placing respon-
sibility for the main sales functions and the important sales
markets directly in the respective divisions. In this way, we
will become faster and more flexible, and will create the right
conditions to better utilize the growth potential in our core
business and in new markets.
– With the programs “Fit for Leadership” at Mercedes-Benz
Cars, “Daimler Trucks #1” at Daimler Trucks, “Performance
Vans 2013” at Mercedes-Benz Vans and “GLOBE 2013”
at Daimler Buses, we intend to realize earnings contributions
totaling approximately €4 billion by the end of 2014 as
a result of measures taken for the sustained improvement
of cost structures and through additional business activities.
Implementation is proceeding according to plan. These
programs will be fully reflected in the earnings of 2015 and
the following years.
– However, the advance expenditure for our model offensive,
for innovative technologies and for the worldwide production
facilities will first affect our earnings in the form of increased
costs and depreciation.
– Within the context of our growth strategy, we are increasing
our production capacities and expanding our worldwide
production network. At the same time, we are enhancing
the flexibility of our manufacturing and cost structures.
– We are also further developing our sales structures – in
North America, in Eastern Europe and especially in the BRIC
countries.
– Although the currently very low level of interest rates and
risk premiums is easing our refinancing, it is also creating
more competition and thus lower margins in the financial
services business.
– Despite our hedging transactions, we must assume that
a sustained high value of the euro against the US dollar,
the Japanese yen and other currencies important to Daimler,
including those of various emerging economies, will
adversely affect the development of earnings compared
with last year.
On the basis of the anticipated market development,
the aforementioned factors and the planning of our divisions,
we assume that Group EBIT from the ongoing business
will increase significantly in 2014.
For the individual divisions, we aim to achieve the following
EBIT targets in full-year 2014:
– Mercedes-Benz Cars: significantly above the prior-year level,
– Daimler Trucks: significantly above the prior-year level,
– Mercedes-Benz Vans: at the prior-year level,
– Daimler Buses: slightly above the prior-year level and
– Daimler Financial Services: at the prior-year level.