LONDON: Mercedes-Benz on Friday narrowed its annual forecast for the profit margin in its core car division as the German luxury automaker continues to struggle amid model changeover and a subdued market environment in Asia.
The company now expects an adjusted return on sales in the range of 10-11 per cent this year, down from 10-12 per cent expected before.
Mercedes' cars division was able to achieve a 10.2 per cent return on sales in the second quarter, in line with its annual guidance.
German automakers are struggling with lacklustre demand for electric vehicles coupled with tough local competition in China, supply bottlenecks and persistently high interest rates.
In the April-to-June period, the group reported a 27.5 per cent fall in adjusted earnings in its car division, versus LSEG's estimate of a 26 per cent decline.
At group level, earnings before interest and taxes (EBIT) dropped in the quarter by 19.1 per cent in line with LSEG's consensus.