2011 turning into a record year for new business, contract volume and EBIT
Chairman Klaus Entenmann: “We will double our business volume in Asia until 2016.”
Expanded business model: vehicle financing and mobility services
Berlin – Daimler Financial Services expects 2011 to be a record year and believes it will grow substantially in the years ahead. The EBIT of Daimler’s financial services division rose to €998 million in the first nine months of 2011. Also the fourth quarter result is expected to be significantly higher than in the same period of last year. For that reason, Daimler Financial Services expects EBIT to reach a record value by the end of 2011.
New business and contract volume are also expected to reach a new record level: During the first ten months of the year, Daimler Financial Services boosted its new business to €26.7 billion, which represents an increase of 12 percent compared to the same period of 2010. During the same period, contract volume rose by 8 percent to €65.8 billion.
Daimler Financial Services is also continuing to grow in the insurance sector in 2011. The company had brokered 753,000 motor vehicle insurance policies by the end of October, which represents an increase of 20 percent on the previous year.
Huge growth potential in India and China
Daimler’s financial services division is growing rapidly in the BRIC countries. “Brazil, Russia, India, and China already account for around 10 percent of our new business worldwide, and this figure is expected to rise to 25 percent over the next five years,” said Klaus Entenmann, Chairman of the Board of Management of Daimler Financial Services, at a press briefing in Stuttgart. “The model offensive in the car and commercial vehicle sectors will trigger a burst of growth in all regions. In Asia alone, we will greatly expand our presence in the years ahead, doubling our business volume there between now and 2016.”
Although the subsidiary Daimler Financial Services India only began offering financial services for Mercedes-Benz cars in summer 2011, the company has already achieved a contract volume of around €40 million. Beginning in 2012, the company will grow further by introducing services for the new truck brand BharatBenz.
In China, Daimler Financial Services has a financing contract volume of €1.4 billion on its books, 42 percent more than at the beginning of the year. Further growth is expected: Daimler Financial Services wants to offer financial services for the commercial vehicle joint venture between Daimler and the Chinese truck manufacturer Foton, thus further strengthening its position as the world’s largest financer of commercial vehicles.
Daimler Financial Services is posting growth rates of 20 percent or more in Taiwan, Korea, Argentina, and Turkey.
Business model will be expanded by mobility services
Klaus Entenmann sees further growth opportunities in the business with new mobility concepts. “We will expand our business model by offering mobility services in addition to just vehicle financing in the future,” he said. As part of this process, Daimler Financial Services incorporated the car2go business. “Thanks to our expertise with banking, fleet management, mobility packages combining financing and insurance, and the corresponding online billing processes, we will develop mobility services within the Group that will meet customers’ needs for new transportation concepts for urban areas,” said Entenmann. One example of this is Stuttgart’s National Electric Mobility Platform project, in which Daimler Financial Services is also involved.
Daimler Financial Services believes it is also in a good position with regard to electric mobility, which has a bright future. Beginning in spring 2012, the company will offer a new product called “sale & care” for the new generation of the smart fortwo electric drive. The product will enable customers to buy, finance, or lease the vehicles at an attractive price. This will be especially the case when a new car buyer rents the battery separately for approximately €60 per month net.
With this offer, Daimler Financial Services will make electric mobility affordable for everyone and relieve the customers of the possible risks.