Daimler’s revenue fell by 3% to $34.05 billion from the first quarter of 2012, while net profit fell to $730 million from $1.8 billion. Volkswagen’s revenue dropped by 1.6% from $61.7 billion to $60.7 billion, while its profit after tax plummeted by 38.2% to $2.5 billion.
Overall, the number of vehicles sold by Daimler, including Mercedes cars, Mercedes vans, Daimler trucks and Daimler buses, remained fairly constant from last year at 501,600 units, while it reported just 1% increase in sales of Mercedes-Benz cars in first quarter of 2013. However, revenues in this unit fell by 6% to $18.59 billion from the year-ago-quarter. Daimler has attributed this decline to the changes made in the sales structure as it introduced new models of Mercedes cars. Overall, the company has put decent numbers in Asia, but continues to face challenges in the more mature markets of Western Europe and North America.
Mercedes-Benz Cars, Daimler’s biggest segment, accounts for 55% of the top-line revenues while Daimler trucks, the second largest segment, accounts for 27% of total sales.
Mercedes aims to surpass Audi by 2020 and wants to increase its deliveries by 4% in the current year. The business currently sells significantly less cars in China than Audi. Daimler is now planning to increase the Mercedes showroom count in China to 75 new outlets each year, as opposed to its previous target of 50. Currently, it has around 260 dealerships in the country, while its competitors have more than 300. China is the second biggest market for Mercedes, and it would be interesting to see how new generation S-Class models will do in the next quarter over there.
Meanwhile, by 2020 Audi is aiming to take its annual sales to 2 million units as it will invest $14.3 billion by 2015 to broaden its portfolio and increase its production. This year, Audi has set a target of delivering 1.4 million units, up from 1.3 million last year. The company is improving its portfolio of “sporty and premium” vehicles by adding new cars such as the SQ5 and RS5 Cabriolet this year.
Volkswagen and Daimler also have significant representation in the iShares MSCI Germany Index Fund ETF, while Daimler is also the fourth biggest holding in First Trust Exchange-Traded Fund II (NASDAQ:CARZ). The Germany Index Fund mainly focuses on 52 large and mid-cap German stocks and is heavily exposed to the consumer discretionary sector. On the other hand the Global Auto Index, as the name suggests, is exclusively about automobile manufacturers. The Global Auto Index doesn’t have Volkswagen, but it, along with the Germany Index Fund, contains the undisputed king of luxury cars and a longtime rival of both Mercedes and Audi: Bayerische Motoren Werke, otherwise known as BMW.
In the last six months, the Germany Index Fund has risen by 10.6% while the Global Auto Index has rallied for an increase of 27.4%. However, the Global Auto Index still has a lower price-earnings ratio of 10.84 as compared to the Germany Index Fund’s 17.92. In the corresponding period, the Germany Index Fund has recorded a net outflow of $1.17 billion, while the Global Auto Index has seen a net inflow of $8.87 million. The Germany Index Fund gives a significantly higher 30-day-SEC yield of 2.64%, while the Global Auto Index gives 0.83%.
The article Audi vs. Mercedes: Who is Winning? originally appeared on Fool.com and is written by Sarfaraz Khan.
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