LONDON: A global shortage of semiconductor chips will dent car sales in the second half of 2021 and will extend into 2022, Daimler AG said on Wednesday, but the maker of Mercedes-Benz vehicles left unchanged its profit margin outlook for this year.
Along with other carmakers, Daimler cut back production this year because of a chip shortage during the coronavirus pandemic, prompting the German company to focus on higher-margin models.
Chief Financial Officer Harald Wilhelm told investors that although the chip shortage would last into 2022, it would be less severe than this year.
The premium carmaker, which also faces the challenge of high prices for steel, copper and aluminum in the second half of 2021, said its visibility into how chip supply would develop was currently low.
“Improving supply visibility is a top priority for us,” Chief Executive Ola Källenius told a conference call with analysts and investors, although he said the chip shortage “is a fixable problem.”
The shortage comes as demand for cars has spiked during the global economy’s recovery from the coronavirus crisis, driving up prices of new and used vehicles as inventories shrink.
Some carmakers have adapted to the chip shortage by dropping some features from their models. General Motors Co. said in March some pickup trucks would not have a fuel management module, hurting their fuel economy performance.
Others, including Daimler, have produced vehicles that are still waiting for chips so they can be completed.
“We have some unfinished cars, but we have not let this balloon out of proportion,” Källenius said.
Mercedes-Benz car sales in the second quarter jumped 27 percent, with a 54 percent jump in Europe, Daimler’s second market after China.
After soaring in late 2020 and the first quarter, Mercedes-Benz sales in China gained just 5.8 percent in the second quarter.
Källenius said order books for the flagship S-class sedans were “very healthy.” But he said the supply chain issues “are holding us back.”
The company said it expected full-year car sales to be in line with 2020 levels, after previously forecasting car unit sales this year would be significantly above last year’s.
Daimler said 2021 adjusted profit margins at its truck and bus division would be between 6 percent and 7 percent, which is below its previous forecast for a range of 6 percent to 8 percent.
The company confirmed second-quarter adjusted group earnings before interest and tax (EBIT) at 5.42 billion euros ($6.38 billion), with car and truck divisions beating analyst targets.
Daimler sees chip shortage dragging on into 2022
https://arab.news/mckxj
Daimler sees chip shortage dragging on into 2022
- Daimler cut production due to chip shortage
- Company sees less severe chip shortage in 2022
Egypt’s Suez Canal revenues reach $2bn in 5 months, up 17.5% YoY
RIYADH: Egypt’s Suez Canal recorded revenues of $1.97 billion from 5,874 ship transits since the beginning of July, marking a 17.5 percent year-on-year increase, Suez Canal Authority Chairman Osama Rabie said during a meeting with a delegation from the International Monetary Fund.
This comes in line with Egyptian Prime Minister Mostafa Madbouly’s statement last October that shipping traffic through the Suez Canal — one of the world’s most important maritime arteries — would return to normal within three months following the peace agreement and ceasefire in Gaza.
It also aligns with Rabie’s comments in an interview with Asharq Bloomberg at the end of last month, in which he predicted that total revenues for the current year would exceed $4 billion, slightly higher than 2024 figures, with a gradual increase expected beginning next fiscal year.
Suez Canal revenues to reach $10 bn
Rabie further forecast that the canal’s revenues would improve during the 2026/2027 fiscal year to around $8 billion, rising to approximately $10 billion the following year, according to a statement issued by the Suez Canal Authority.
The canal generated a total of $40 billion between 2019 and 2024 and remains the country’s most important source of foreign currency.
The IMF recently projected that Suez Canal revenues would begin to recover during the current fiscal year, with a gradual increase expected to reach $11.9 billion by fiscal year 2029/2030 as tensions in the Red Sea subside.
Rabie noted in a previous interview with Asharq Bloomberg that vessel traffic has shown steady improvement following the agreement to end the war in Gaza, adding that shipping companies are eager to resume transiting the canal.
French shipping company CMA CGM recently conducted a trial transit of two large cargo vessels through the Suez Canal from Bab-el-Mandeb — a move Rabie said is likely to encourage other major shipping lines to return to the route.
