German automaker Mercedes-Benz profit beats on rising car prices

German automaker Mercedes-Benz profit beats on rising car prices

Despite a shortage of semi-conductors and the consequences from the Ukraine conflict, Mercedes-Benz said Wednesday that increased sales prices helped it raise its bottom line somewhat in the first three months of the year.

Mercedes-Benz stated in a statement that its net profit for the first three months of the year was 3.6 billion euros ($3.8 billion), up 3% from the same period last year.

On a 6% increase in revenues to 35 billion euros, underlying or operational profit increased by 11% to 5.2 billion euros.

A “sharpened focus on top-end automobiles and premium vans, along with continuous cost management,” according to the Stuttgart-based automaker, increased its earnings. Even while the Covid-19 outbreak raged, supply-chain constraints in the semiconductor industry and the war in Ukraine continued to wreak havoc.”

Mercedes-Benz reported a ten percent drop in unit sales to roughly 487 thousand.

Automobile manufacturers have been battling shortages of semiconductors, electrical components used in both conventional and electric vehicles, for the past year, and have been forced to halt production on occasion.

Manufacturers are also experiencing supply-chain interruptions as a result of the conflict in Ukraine.

Mercedes-Benz, like rivals BMW and Volkswagen, stopped exporting to Russia and closed production plants there, resulting in 709 million euros in related expenses in the first quarter.

The prognosis was darkened by a “extraordinary degree of uncertainty,” particularly the war’s influence on “supply chains and the development of raw material and energy prices.”

In terms of the future, According to Mercedes-Benz,

Mercedes predicted that shortages, especially chip shortages, will “affect business for the remainder of 2022.”

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