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FULL ARTICLE | EDITORIAL 
Star reborn 
Peter Schmidt | Editor

Published: Fri, 03rd February 2017 14:22:17 GMT
 

Dieter Zetsche Geneva Motor Show presentation


Open quote signFor Daimler’s Mercedes car division the pendulum of success has swung back and forth several times in its long and tradition-rich history. 

The same goes for the fortunes of Daimler’s current CEO Dieter Zetsche, who boasts the combined rare skills needed for both top-notch leadership and professional showman. 

At Daimler, as is the case with every company, both the company’s fortunes and the perceived quality of its helmsman are inexorably intertwined. 

Today, with Daimler’s commercial fortunes still on a roll, good fortune is also smiling at Dieter Zetsche. 

Thanks to skilful navigation, rather than a run of good luck, Mercedes - four years earlier than planned - has comfortably regained the coveted global premium sector car sales crown. 

But there is more. 

A great deal more. 

To his credit, even a brief look at Daimler’s glowing full year 2016 numbers reveals tellingly that its impressive fight for sector leadership did not come at the expense of profits. 

Apart from highest ever unit sales for the Mercedes car division, there’s also a complete set of all-time records for sales revenue and profits. 

The right mix of high-image products lies at the root of Mercedes’ current good fortune. 

Foremost, aside from its unrelenting push into China with locally built products, its mushrooming line-up of SUV-Crossovers helped catapult its financial fortunes into record orbit. 

Good judgement rather than magic, by responding to the opportunities to be had in what now ranks as the fastest growing and highly profitable slice of today’s global car market, helped lift last year’s Mercedes SUV-Crossover sales by almost a third to a bumper 712,000 units. 

Compared with the historical S-Class profit engine, whose sales slipped last year to 84,000 units, Mercedes’ SUV locomotive not only outsold its Smart sister brand almost fivefold, it alone generated just over a third of last year’s Mercedes-badged global car sales. 

So no surprise then that yesterday Mr Zetsche wowed both the analysts’ community and shareholders alike with Daimler’s 2016 full-year results presentation. 

The Mercedes car arm not only bagged the global prestige sector crown after posting highest-ever unit sales, but also posted new sales revenue and earnings records, plus double-digit profit margins at the same time. 

Business students the world over will doubtless be grateful for Mr Zetsche’s credible efforts to add the odd new section to their familiar textbook on how best to react profitably to beckoning opportunities. 

While delivering yesterday’s master class, Zetsche - before last year’s exceptional expenditure - not only revealed a full-year 10 per cent pre-tax margin for the high-flying Mercedes car side of the business. 

He also revealed record sales from Daimler’s still flourishing van business, which ended last year with a striking 10.1 per cent pre-tax margin.

Mercedes, responding with gusto to the only real visible face of today’s Amazon-type online shopping boom – medium white vans - was quick to jump on today’s speeding bandwagon. 

After lifting profit margins of humble white vans into double-digit prestige sector territory - investors will be eager to hear what comes next; a profitable set of electrically propelled cars, vans and trucks?
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