Annual Report 2016

Business development

Unit sales

Daimler increased its total unit sales in the year 2016 by 5 % to approximately 3 million vehicles, thus achieving its growth target. The Mercedes-Benz Cars and Mercedes-Benz Vans divisions confirmed the forecasts made at the beginning of the year with significant growth (+10 % and +12 % respectively). Daimler Trucks posted a significant decrease in unit sales of 17 %. At the beginning of the year, the division had aimed for unit sales in the magnitude of the previous year. That target had to be successively adjusted as a result of the significantly less favorable market development in the NAFTA region, the Middle East and Turkey. Also at Daimler Buses, unit sales were significantly below the prior-year level (-7 %) and did not reach the originally anticipated volume, primarily due to repeated significant market contraction in Brazil.

The Mercedes-Benz Cars division continued along its growth path in the year under review. Unit sales increased by 10 % to the new record of 2,198,000 vehicles. The Mercedes-Benz brand increased its unit sales by 9 % to a best-ever figure of 2,053,500 vehicles. This means not only that Mercedes-Benz grew faster than the worldwide car market, but also that it delivered more vehicles in the premium segment than any other manufacturer. We are the number one in the premium segment in Germany and some other key European markets, as well as in the United States, Canada and Japan. In addition, we significantly improved our position in China in 2016.

In Europe, Mercedes-Benz sold a total of 872,200 vehicles (+12 %). Double-digit growth rates were achieved above all in the volume markets of the United Kingdom (+15 %), France (+18 %), Italy (+16 %) and Spain (+20 %). And in Germany, we increased our unit sales by 6 % to 275,900 vehicles. In China, we grew by 20 % in 2016 – faster than the overall market and important competitors. Total unit sales in the NAFTA region were slightly lower than in the previous year. Growth was achieved in Mexico, while our unit sales in the United States and Canada decreased slightly. Unit sales in Japan were 6 % lower than in 2015 due to the general market development. However, we achieved significant growth in South Korea (+33 %), Australia (+17 %) and Taiwan (+12 %).

The growth was primarily driven by our SUVs; total unit sales in that segment increased by 31 % to 712,100 vehicles. Demand was very strong also for our A- and B-Class models, with an increase of 2 %. Including the CLA and CLA Shooting Brake, 435,400 of those cars were delivered. Our C-Class models enjoyed ongoing success, with a 4 % increase in unit sales to a total of 490,200 sedans, wagons, coupes and convertibles in 2016. In the year of the model change, the E-Class almost matched the prior-year volume, with the new model creating strong sales impetus as of the third quarter. We sold a total of 304,200 vehicles in the E-Class segment, including 188,300 units of the new model. Although there was a decrease in sales of the S-Class for lifecycle reasons to 84,300 units (2015: 106,200), it continues to be the world’s bestselling luxury sedan. (See graphic B.07)

B.07 Unit sales Mercedes Benz Cars
 
B.08 Unit sales Daimler Trucks

B.09 Market share1

  2016 2015 16/15
In %   Change in % points
       
Mercedes-Benz Cars      
European Union 6.2 5.8 +0.4
thereof Germany 10.4 10.1 +0.3
United States 2.0 2.0 +0.0
China 2.1 1.9 +0.2
Japan 1.7 1.6 +0.1
       
Daimler Trucks      
Medium- and heavy-duty trucks EU30 (excluding the UK)   21.6 22.4 -0.8
thereof Germany 37.2 36.9 +0.3
Heavy-duty trucks NAFTA region (class 8) 40.0 39.3 +0.7
Medium-duty trucks NAFTA region (classes 6 and 7)   37.9 39.7 -1.8
Medium- and heavy-duty trucks Brazil   29.8 26.7 +3.1
Trucks Japan 20.4 20.8 -0.4
Trucks Indonesia 46.7 48.0 -1.3
Medium- and heavy-duty trucks India   6.8 7.3 -0.5
       
Mercedes-Benz Vans      
Mid-size and large vans Western Europe   18.4 18.4 0
thereof Germany 27.3 27.1 +0.2
Small vans Western Europe 3.1 3.2 -0.1
Large vans United States 7.6 8.7 -1.1
       
Daimler Buses      
Buses over 8 tons EU30 29.7 29.5 +0.2
thereof Germany 50.1 49.3 +0.8
Buses over 8 tons Brazil 58.4 52.5 +5.9

1 Based on estimates in certain markets.

The smart brand reached a sales milestone in September 2016, with more than two million vehicles sold since its market launch in 1998. Meanwhile, smart is represented in 46 markets worldwide. In the year 2016, the brand’s unit sales increased by 19 % to the new record of 144,400 cars. (See Mercedes-Benz Cars)

Unit sales by Daimler Trucks in 2016 were significantly lower than in the previous year. In total, we delivered 415,100 heavy-, medium- and light-duty trucks as well as buses of the Thomas Built Buses and FUSO brands (2015: 502,500). Daimler Trucks continues to be the world’s biggest manufacturer of trucks above 6 tons. (See graphic B.08)

Positive market impetus was delivered by the EU30 region (European Union, Switzerland and Norway), although with decreasing dynamism in the second half of the year. Our sales in this region increased by 4 % to 79,800 trucks. The Mercedes-Benz brand remained the market leader in the medium- and heavy-duty segment (excluding the United Kingdom) with a share of 21.6 % (2015: 22.4 %). In Turkey, our unit sales fell by more than half to 9,300 vehicles in the year under review (2015: 24,900). This drastic slump was caused by weak demand caused by purchases being brought forward to 2015 due to the introduction of the Euro VI emission standard at the beginning of 2016, as well as the country’s difficult situation. (See table B.09)

Unit sales in Latin America decreased significantly once again to 27,500 vehicles, due in particular to the deep recession in Brazil, our main market in that region (2015: 30,500). In this environment, we were able to achieve market leadership and increased our market share in the medium- and heavy-duty segment in Brazil with trucks of the Mercedes-Benz brand to 29.8 % (2015: 26.7 %). Irrespective of the currently difficult situation, we believe in the long-term importance of the Latin American market.

Also in the NAFTA region, we were unable to avoid the impact of a sharply contracting market for class 8 trucks. Our unit sales of 145,700 trucks were significantly below the unusually high number sold in the previous year (2015: 191,900). But in classes 6-8, we are the market leader by a significant margin with a market share of 39.3 % (2015: 39.4 %). In class 8 for heavy trucks, we increased our market share to 40.0 % (2015: 39.3 %).

We increased our sales in Japan to 46,400 units (2015: 45,600). With the FUSO brand, we achieved a share of the overall truck market in Japan of 20.4 % (2015: 20.8 %). In an Indonesian market that once again contracted sharply, our unit sales fell to 28,000 vehicles (2015: 32,100). With a share of 46.7 % of the overall truck market, we continue to be the market leader by a large margin (2015: 48.0 %).

In India, our sales of 13,100 trucks were lower than in the previous year (2015: 14,000); our market share was 6.8 % (2015: 7.3 %). Deliveries of the export vehicles produced in Chennai to customers in Asia, Latin America and Africa more than doubled to over 4,000 units in 2016. Meanwhile, more than 30 markets are supplied with trucks from Chennai.

In the Middle East, our sales decreased substantially to 17,600 units (2015: 36,300). The main reasons for the low level of investment there in 2016 were the low oil price and the ongoing conflicts in the region.

In China, the world’s biggest truck market, Daimler AG holds a 50 % interest in Beijing Foton Daimler Automotive Co. Ltd. (BFDA), a joint venture with Beiqi Foton Motor Co. Ltd. Medium- and heavy-duty trucks of the Auman brand have been produced there since mid-2012. With the recovery of the Chinese truck market in 2016, the joint venture increased its sales of Auman trucks to 77,800 units (2015: 69,200). (See Daimler Trucks)

Mercedes-Benz Vans once again achieved record sales of 359,100 vehicles in 2016, surpassing the prior-year figure by 12 %. While we primarily focus on commercial customers with the Sprinter, Vito and Citan models, the V-Class is primarily aimed at private users. In the EU30 region, our most important market, we increased our unit sales by 13 % to 249,900 vehicles, and we continue to be the market leader for mid-size and large vans with a share of 18.4 % (2015: 18.4 %). Significant growth was achieved in the key European volume markets, and the division achieved a new record in Germany with sales of 96,100 units (2015: 88,400). However, unit sales decreased significantly in Russia (-15 %) and Turkey (-7 %). Mercedes-Benz Vans continued along its growth path in the NAFTA region; sales there increased significantly to 43,400 units (2015: 40,500) and the division’s market share for large vans in the United States reached 7.6 % (2015: 8.7 %). The market environment in Latin America remained difficult and sales therefore decreased by 21 % to 12,500 units. In China, following the successful start of our vans in the midsize segment (Vito and V-Class), unit sales increased compared with the previous year by 90 % to 13,600 vehicles. In total, we sold 193,400 Sprinter vans worldwide in the reporting period (2015: 194,200). Sales of the Vito increased by 24 % to 92,100 units. The V-Class multipurpose vehicle was particularly successful; sales of 48,700 units surpassed the prior-year number by 58 %. Sales of the Mercedes-Benz Citan reached 24,900 units (2015: 21,700). (See Mercedes-Benz Vans)

Daimler Buses sold 26,200 buses and bus chassis in 2016 (2015: 28,100). The significant decrease is due in particular to the ongoing difficult economic situation in Brazil. Nonetheless, the division maintained its clear market leadership in its traditional core markets of the EU30, Brazil, Turkey, Argentina and Mexico. The business with complete buses in the EU30 region developed positively. Sales here increased by 3 % to 8,800 units and market share was once again at the very high level of 29.7 % (2015: 29.5 %). Due to strong demand for our Mercedes-Benz and Setra buses, unit sales in Germany increased to 3,100 vehicles (2015: 2,800). As a result of the currently difficult situation in Turkey, our sales of 600 units there were significantly below the prior-year number (2015: 1,000). The situation in Latin America (excluding Mexico) worsened again considerably because of the ongoing difficult economy there, especially in Brazil. Unit sales of Mercedes-Benz bus chassis once again fell by a double-digit rate in Brazil (-32 %) to 4,900 units. Nonetheless, we were able to significantly strengthen our leading market position in Brazil with a market share of 58.4 % (2015: 52.5 %). In Mexico, sales of 3,800 units were slightly lower than in the previous year (2015: 4,000), whereby a stable market share was maintained at the high level of the previous year. (See Daimler Buses)

Business at the Daimler Financial Services division developed positively in the year under review. As we had forecast in Annual Report 2015, worldwide contract volume continued to grow, reaching the new record level of €132.6 billion (+14 %). The acquisition of Athlon Car Lease International B.V. contributed €3.7 billion of the growth in contract volume. Adjusted for exchange-rate effects and the Athlon acquisition, contract volume grew by 10 %. New business also increased in the magnitude we had anticipated: by 7 % to €61.8 billion. Significant growth was recorded in Europe (+9 %) while the prior-year level was not quite reached in the Americas region (-2 %). The growth of new business in the Africa and Asia-Pacific region was once again particularly dynamic at a rate of 18 %. In the insurance business, we brokered a total of 1.8 million policies, as in 2015. Daimler Financial Services supported numerous companies with the financing and management of their vehicles and fleets in 2016. At the end of the year, the division had a total of 361,000 vehicles on its books in Europe. With last year’s acquisition of Athlon, we invested in the growth of the fleet-management business and considerably strengthened our competitive position. Athlon accounted for 268,000 contracts with fleet customers. We further expanded the business with innovative mobility services in 2016. car2go had more than 2.2 million users at the end of the year and is thus the world’s leader for flexible car sharing. We also further developed the moovel app, with which customers in Germany can find the best way of traveling from A to B using various modes of transport, and can directly book and pay providers such as car2go, mytaxi and Deutsche Bahn (German Railways). In April, Hamburg was the first city with more than a million inhabitants to be integrated into the moovel app. Since then, it has been possible to book and pay for journeys in the entire Hamburg public transport system. In addition, the moovel Group has consolidated its activities in North America: GlobeSherpa has been merged into RideScout and renamed as moovel North America. With moovel transit, moovel North America is the leading provider of mobile ticket solutions for the apps of public transport companies in the United States. The company has more than 2.2 million users in Germany and the USA. In July, mytaxi and Hailo, two leading app-based taxi providers, decided to join forces and merge into one company. Based in Hamburg, it operates under the mytaxi brand, and is the biggest European taxi network with 100,000 drivers and approximately six million customers in more than 50 cities in nine countries. (See Daimler Financial Services)

Order situation

The Mercedes-Benz Cars, Daimler Trucks, Mercedes-Benz Vans and Daimler Buses divisions produce vehicles predominantly to order in accordance with customers’ specifications. In doing so, we flexibly adjust production numbers to changing levels of demand. Due in particular to strong demand in China and the European markets, the number of orders placed with Mercedes-Benz Cars was once again above the high level of orders recorded in the previous year. This was driven on the product side primarily by our very successful SUVs and, as of the second half of the year, also by the new E-Class models. Due to the positive development of demand, we significantly increased our production volumes. Nonetheless, the order backlog at the end of 2016 was higher than a year before. At Daimler Trucks, both orders received and order backlog at year-end were significantly lower than a year earlier. This primarily reflects the low demand in the market for heavy-duty trucks in the NAFTA region and the ongoing market weakness in the Middle East and Turkey.

B.10 Consolidated revenue by region

Revenue

In the year 2016, Daimler generated revenue of €153.3 billion, which is slightly above the prior-year level (2015: €149.5 billion); adjusted for exchange-rate effects, revenue grew by 3 %. This means that our expectations at the beginning of the year were fulfilled. Each of the divisions Mercedes-Benz Cars (+7 %), Mercedes-Benz Vans (+12 %) and Daimler Financial Services (+9 %) significantly increased its volume of business. Whereas the Daimler Trucks division posted a significant decrease in revenue of 12 %, primarily due to the very weak condition of some major truck markets, which we had not anticipated at the beginning of the year. At Daimler Buses, revenue was 2 % higher than in the previous year.

In regional terms, Daimler achieved revenue growth in Europe (+9 % to €63.4 billion) and in Asia (+5 % to €35.6 billion) while the prior-year level was not quite achieved in the NAFTA region (-6 % to €45.0 billion).

B.11 Revenue by division and region

  2016 2015 16/15
In millions of euros     % change
       
Daimler Group 153,261 149,467 +3
       
Divisions      
Mercedes-Benz Cars 89,284 83,809 +7
Daimler Trucks 33,187 37,578 -12
Mercedes-Benz Vans 12,835 11,473 +12
Daimler Buses 4,176 4,113 +2
Daimler Financial Services 20,660 18,962 +9
       
Regions      
Europe 63,417 58,247 +9
thereof Germany 23,509 22,001 +7
NAFTA 44,960 47,653 -6
thereof United States 39,169 41,920 -7
Asia 35,562 33,744 +5
thereof China 15,984 14,684 +9
Other markets 9,322 9,823 -5
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