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Daimler will not sacrifice workforce for profit margin

By SYF77 on 26 Feb 2012

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Daimler may have fallen behind its German rivals, namely Audi and BMW, in terms of profitability but it would not go down the road of reducing its workforce in an attempt to narrow the gap. "I see no reason to look exclusively at personnel when it comes to increasing efficiency," said Mr Wilfried Porth, Daimler’s personnel chief, in an interview with Reuters. He added that staff costs account for less than a fifth of group expenses.

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Mercedes, which had a 9 percent operating margin in 2011, has been lagging Audi and BMW in terms of profitability even though the two tend to sell cars priced below those of Mercedes. Daimler has about 271,000 employees around the globe with nearly 168,800 of them based in Germany. On the contrary, Daimler plans to further increase the number of its home-based employees this year. However, the increase will be lesser than in 2011. I guess this is a prudent move, considering the unresolved Eurozone debt crsis, which may affect the demand of luxury cars.

Daimler has pledged to regain its status as the best-selling luxury automaker from BMW after falling into third place behind Audi in 2011. Last year, Mercedes moved 1.26 million units worldwide while Audi and BMW sold 1.3 million and 1.38 million cars respectively. To do so, Mercedes plans to launch 10 new models by 2015. These include the new A-class hatchback, which will make its debut in March at the 2012 Geneva Motor Show, as well as the CLS Shooting Brake, an estate wagon based on CLS platform.

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Written by SYF77
I have been a car fanatic since 1989, when my father was changing our family car then to a Toyota Corolla 1.6 GL fitted with a Twin Cam 16 valve engine that was carburetor-fed, a big deal back in those days. The automobile technology and industry fascinates me and I hope to broadcast these interesting developments to everyone out there through this blog.

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