FRANKFURT, Germany (AP) — German automaker Daimler AG said Thursday that its net profit fell 27 percent in the second quarter as the company confronted multiple challenges including trade tensions, weak pricing for its luxury cars, and recalls and product delays related to diesel emissions.
Net profit fell to 1.8 billion euros ($2.1 billion), from 2.5 billion euros a year earlier. Revenues fell 1 percent to 40.8 billion euros.
The Stuttgart-based maker of Mercedes-Benz cars said weak pricing for its luxury cars including tariffs played a role. It also cited a fire at a U.S. supplier that caused a production shortfall, as well as unfavorable exchange rates and expenses for post-sale adjustment of diesel car emissions.
The profit margin on sales at Mercedes, a key earnings metric, fell to 8.4 percent from 10.0 percent in the year-earlier quarter.
The company also said it was experiencing slowdowns in certification of models under new EU emissions testing standards as it works on software and clarifies technical and legal questions.
Earnings at the truck division were flat while profits at its bus division and financial services business both fell.
The company had already lowered its earnings outlook for the year, citing global trade tensions. China has announced it will raise tariffs on cars imported from the U.S. in response to tariffs announced by U.S. President Donald Trump. Daimler makes vehicles in the U.S. and exports them to China so those sales would be hit by the tariff.
