On February 20, Mercedes-Benz Group AG (hereinafter referred to as Benz) released its 2024 fiscal year performance report, and "stable" and "resilience" became the key words.
Data shows that in fiscal year 2024, Benz's turnover reached 145.6 billion euros, and its full-year profit before interest and taxes was about 13.7 billion euros. Thanks to high cash conversion rate and strict cost control, Benz's free cash flow from industrial business in 2024 reached 9.2 billion euros. Despite more than 10 billion euros in dividend payments and stock repurchase cash in 2024, Benz still showed strong cash flow capabilities.
Specifically, in 2024, the adjusted EBIT of the Benz passenger car segment was 8.7 billion euros, with a sales profit margin (RoS) of 8.1%; the adjusted EBIT of the light commercial vehicle segment was 2.8 billion euros, with a sales profit margin of 14.6%.
It is worth noting that in 2024, Benz's R&D costs remained at a high level. Among them, the R&D expenditure of the passenger car business reached 8.7 billion euros, mainly used for investment in future platforms and technologies-especially investment in MB.OS, while investment in fixed assets (PP&E) was at the same level in 2023. The R&D expenditure of the light commercial vehicle business was 1 billion euros, mainly used for investment in new platforms for more flexible light commercial vehicles in the future, including the VAN.EA platform for pure electric vehicles and the VAN.CA platform for fuel vehicles.
"In 2024, Mercedes-Benz Group AG achieved solid performance in a very challenging market environment." Ola Källenius, Chairman of the Board of Directors of Mercedes-Benz Group AG, said.
It is worth mentioning that despite the impact of macro factors, the Benz Board of Directors and Supervisory Board will still propose a dividend of 4.30 euros per share at the annual general meeting of shareholders held on May 7 this year, and decide to repurchase shares worth no more than 5 billion euros (excluding handling fees) within 24 months (provided that the annual general meeting of shareholders in May 2025 can authorize the repurchase of up to 10% of the stock capital).
In fact, in order to further enhance the competitiveness and resilience of the company, Benz has begun to implement a comprehensive corporate operating performance improvement plan to achieve a return to double-digit adjusted sales profit margins in the passenger car business. Specific measures include further releasing the growth potential of direct sales channels and improving the efficiency and flexibility of global production operations. Benz said that it plans to reduce production costs by 10% in 2027, and fixed cost reduction measures will continue until 2027.
"To ensure that the company remains competitive in an increasingly volatile environment in the future, we are taking measures to make the company leaner, faster and stronger, and starting with the new CLA, including a series of intensive new models. Product offensive." Ola Källenius said.
According to the plan, Benz's new round of product offensive will start with the new CLA in 2025, followed by a new facelift and upgrade of the S-Class in 2026, and the launch of the new all-electric GLC SUV, the new all-electric C-Class, and several all-electric products and high-tech electrified internal combustion engine products of the Mercedes-AMG brand. Some believe that by 2027, Benz will have a dense and rich new or renewed model launch, and its sales may rise accordingly.
