daimler chrysler services north america

Daimler Achieves EBIT of €648 Million in third quarter of 2008

Authorized PRESS RELEASE

Stuttgart, Germany, Oct 23, 2008

* EBIT includes charges from notable factors totaling
EUR 765 million

* Net profit of EUR 213 million
(Q3 2007: net erosion of EUR 1,533 million)

* Unit sales down by 3% to 522,500 cars and commercial vehicles

* Returns down by 7% to EUR 23.8 billion, adjusted for disagreement-rate effects and changes in the consolidated aggregation down by 5%

* Share buyback program pro tem suspended

* Full-year EBIT from relentless operations of more than
EUR 6 billion anticipated (excluding inimitable Items and Chrysler)

The worsening banking disaster, its effects on the real economy, and the resulting far-reaching consumer uncertainty had a negative hit on the business development of Daimler AG (stock-barter abbreviation DAI) in the third quarter of this year.
Daimler achieved EBIT of EUR 648 million in the third favour of 2008 (Q3 2007: EUR 1,891 million).

The go in EBIT is primarily the result of turn down earnings at the Mercedes-Benz Cars sector. In addition, special items reduced earnings by a utter of EUR 765 million (see table on errand-boy 9).

There were positive effects, however, from improved earnings at the Daimler Trucks partition as well as at the Mercedes-Benz Vans and Daimler Buses units. The profit contribution from Daimler Fiscal Services was also above the prior-year level.
Net profit amounted to EUR 213 million (Q3 2007: net passing of EUR 1,533 million), equivalent to earnings per part of EUR 0.21 (Q3 2007: loss per split of EUR 1.47). The net loss of the prior-year location included special effects from the Chrysler minutes.

Daimler will temporarily suspend the further execution of its equity buyback program. Due to the suspension Daimler might not reach its endorse target to buy back 10% of the outstanding shares.

Dieter Zetsche, Chairman of the Advisers aboard of Management of Daimler AG and head of Mercedes-Benz Cars: "We accept that the situation is very challenging indeed. We press in advance consequently with our cost efficiency programs in all our businesses. We'll also proceed with to execute our aggressive R&D and product plans. The point of our company is very solid - and that makes me assured - that Daimler can and will emerge strong."

Group part sales down by 3%

In the third quarter of 2008, Daimler sold 522,500 rider cars and commercial vehicles worldwide (Q3 2007: 537,000).

Daimler's third-shelter revenue decreased from EUR 25.7 billion to EUR 23.8 billion. Adjusted for Wall Street-rate effects and changes in the consolidated set apart, the revenue decrease amounted to 5%.

At the end of the third dwelling of 2008, Daimler employed 275,535 people worldwide (end of Q3 2007: 271,961). Of that all-out, 168,667 were employed in Germany (end of Q3 2007: 166,971).

Details of the divisions in the third section of 2008

Mercedes-Benz Cars sold 315,800 vehicles in the third fourth (-6%). 282,100 Mercedes-Benz label vehicles were sold (-8%), while sales of the perceptive brand rose by 20% to 32,300 units. Yield amounted to EUR 11.6 billion (Q3 2007: EUR 14.1 billion).

The unit's third-quarter EBIT of EUR 112 million was significantly lessen than the result for the prior-year space (EUR 1,331 million), despite further proficiency improvements.

The decrease in earnings was principally due to the abrupt decline in sales in the NAFTA field as well as in the major European markets.

In this surroundings, the Group also recorded charges of EUR 449 million resulting from the reassessment of leftover values of leased vehicles. Other factors with a denying impact on earnings were an unfavorable archetype mix, exchange-rate effects and higher raw-solid prices.

Daimler Trucks increased its part sales in the third quarter by 4% to 122,700 vehicles. Gross income increased from EUR 7.0 billion to EUR 7.3 billion.
The partitioning achieved EBIT of EUR 510 million in the third caserne, which was higher than the prior-year consequence despite difficult market conditions in the Communal States and Japan.

The division's earnings benefited from strapping sales of trucks in Brazil and Europe, specially in Germany. A favorable model mix and permissible product positioning also contributed to the earnings circumstance. Expenditure in connection with new and enhanced output development had a negative impact on the EBIT of Daimler Trucks.
Trucks Europe/Latin America (Mercedes-Benz) posted repeated wen in unit sales of 12% in the third abode, selling 47,300 vehicles. Trucks NAFTA (Freightliner, Fine, Western Star, Thomas Built Buses) sold 25,800 vehicles; this was 7% more than in the until-year quarter, although that period had been impacted by very delicate sales in the US market. Despite its well-founded business outside Japan (+1%), Trucks Asia (Mitsubishi Fuso) was not skilled to compensate for the ongoing weak in request for trucks in the Japanese market.

Daimler Pecuniary Services division expanded its worldwide draw together volume by 11% to EUR 63.9 billion in the third compassion. Compared with the prior year, 15 additional companies were consolidated for the first just the same from time to time, most of them in Eastern Europe and Asia. Without this power and adjusted for exchange-rate effects, the advance was 9%. Compared with the prior-year term, new business increased by 19% to EUR 7.7 billion; adjusted excrescence amounted to 18%.

Third-quarter EBIT of EUR 173 million reported by Daimler Economic Services was higher than the figure of EUR 87 million posted in 2007. The end result for the prior-year period had been significantly impacted by the expense of mounting up an independent financial services organization in the NAFTA tract following the transfer of a majority interest in the Chrysler function. The other main reason for the earnings gain was the expanded contract volume. A further snowball in cost of risk had a negative influence on the division's earnings.

The Vans, Buses, Other part posted EBIT of minus EUR 100 million in the third district (Q3 2007: EUR 319 million). The Mercedes-Benz Vans and Daimler Buses units profited from the auspicious development of unit sales and both achieved higher earnings: Mercedes-Benz Vans reported EBIT of EUR 212 million and Daimler Buses reported EBIT of EUR 92 million.

Regard for difficult market conditions, Mercedes-Benz Vans increased its third-accommodations unit sales by 1% to 73,200 vehicles.

Daimler Buses sold 10,800 buses and chassis in the third residence, surpassing the very high level of the until-year period by 15%. A reasonable contribution to this result came from sales in Europe, where 2,300 buses of the Mercedes-Benz and Setra brands were sold (+31%). Item sales also developed very positively in Mexico (+44%) and South America (+3%).

Daimler's interest of the earnings of EADS amounted to minus EUR 8 million (Q3 2007: minus EUR 20 million). Daimler's judiciousness interest in Chrysler negatively affected EBIT in the third lodgings of 2008 by a total of EUR 351 million; this includes charges of EUR 248 million relating to the restructuring program and the reassessment of spare values. The results in connection with the objectivity interests in EADS and Chrysler are not cash productive.

Outlook

In light of the worsened pecuniary market crisis and the resulting change on future economic developments, forecasts are connected with a foremost degree of uncertainty in the current circumstances. In addition, it is not yet possible to reliably assess how rapidly the action plans announced by different governments will contribute to the stabilization of markets for monetary services and goods.

Mercedes-Benz Cars expects part sales to be similar to the prior-year straight-shooting, despite of the negative market evolution and adjustments to its production program. There will be sheer impetus from the full availability of the new C-Class sedan and location wagon and the new smart fortwo, as well as from the A- and B-Assort, the CLS, SLK, SL and the CLC, which were all newly launched or refreshed during the year 2008. The establish of the refreshed M-Class and especially the new GLK will fix up with provision additional sales momentum also in the following year. However, for lifecycle reasons we reckon on lower unit sales of the E-Prestige, which is in its last full model year.
Against the backdrop of jumbo turmoil on financial markets and the resulting effects on profitable developments in the industrialized countries, including falls in item sales in major markets (in some cases of doubled-digit percentages) and requiring reassessment of vehicles' remaining values, the previous earnings forecasts for 2008 can no longer be achieved. Daimler now assumes that the boundary line will achieve EBIT in the magnitude of EUR 2.5 billion and a coming on sales of approximately 5% in 2008; charges of EUR 449 million from the reassessment of leased vehicles' surplus values are included therein.

Daimler Trucks anticipates higher part sales in 2008 than in the prior year. This increase is primarily based on the positive phenomenon of unit sales in some important markets such as Brazil, Indonesia and the Mean East. Growth in unit sales is also indicated for Eastern Europe, but is expected to turn back to a moderate level by the end of 2008. This means that after six above-mean years, the European market for commercial vehicles is normalizing once again. For the US and Japanese markets, module sales are expected to be once again below the volumes of the previous year.

Growth in unit sales will be restrictedly offset by higher raw-material costs and the feeble US economy. On this basis, the division expects...

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