NEW YORK, April 23 — Daimler AG said today it expected to report a near 70 per cent plunge in a key first-quarter earnings figure and 2020 industrial free cash flow to fall, as customers shunned Mercedes-Benz car showrooms amid the novel coronavirus pandemic.

The forecast provides further evidence of the financial damage inflicted by the pandemic on the auto market, as global vehicle sales and production get pummelled by tight restrictions governments have had to impose on business activity and the movement of people to control the spread of the virus.

Earlier this month, rival luxury car maker BMW reported a 20.6 per cent drop in first-quarter sales and said it was expecting a further decline in global demand.

Overall passenger car sales tumbled by more than 50 per cent in Europe’s major markets last month, with Italy — hit particularly hard by the pandemic — reporting the biggest drop of 85.4 per cent, according to data from the European Auto Industry Association (ACEA).

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Daimler reported preliminary adjusted first-quarter earnings before interest and tax (EBIT) of €719 million (RM3.38 billion), a 68.9 per cent fall from a year earlier. It also expects total unit sales and revenue for 2020 to be lower compared to last year.

Preliminary adjusted EBIT for Mercedes-Benz cars & vans fell more than 56 per cent to €603 million.

Across the Atlantic, Ford Motor Co estimated a loss of about US$2 billion for the first quarter, and had to raise US$8 billion from corporate debt investors to shore up its cash reserves.

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Meanwhile, Germany, Europe’s largest economy, has begun to ease some restrictions, allowing carmakers to restart production.

Mercedes-Benz, which had suspended most of its production in Europe, said yesterday it was ramping up engine production at its plant in Bad Cannstatt, Stuttgart as it gradually reopens plants on the continent using lessons learned from resuming production at its plant in China. — Reuters