Although sales fell 5% to 2,093,500 units, Mercedes-Benz's profit margin in 2021 set a new record.
On February 24, Mercedes-Benz Group AG officially announced its results for the 2021 fiscal year. According to the data, the turnover of the Mercedes-Benz Group increased by 8.88% year-on-year to 168 billion euros (about 1.19 trillion yuan), of which the continuous operation (that is, excluding the Business of Daimler Trucks and Buses) increased by 9.9% year-on-year to 133.9 billion euros.
In 2021, the Mercedes-Benz Group's EBIT increased by 340.9% year-on-year to EUR 29.1 billion, of which continuing operations increased by 162.3% year-on-year to EUR 16 billion. During the same period, the company's adjusted EBITDA increased by 123.3% year-on-year to EUR 19.2 billion.
The Mercedes-Benz Group's net profit for 2021 increased by 485% year-on-year to EUR 23.4 billion, with net profit from continuing operations increasing by 177.5% y/y to EUR 11.1 billion, as a result of higher revenue and EBIT.
In 2021, Adjusted EBITDA in the Mercedes-Benz Passenger Cars and Light Commercial Vehicles segment increased 105% year-over-year and adjusted sales margins to 12.7%. Since 2019, fixed costs in the Mercedes-Benz passenger car segment have decreased by a total of 16 percent, while average bicycle revenues have increased by 26 percent to 49,800 euros.
On February 1, 2022, Daimler AG officially changed its name to Mercedes-Benz Group AG and Daimler Mobility AG was officially renamed Mercedes-Benz Mobility AG. Daimler's Trucks & Buses segment went public in December 2021 after becoming independent. To this end, the data in the financial statements of the Mercedes-Benz Group are divided into businesses that are continuing to operate and businesses that have ceased to operate.
Sales of high-end models increased by 30% in 2021
The improvement of revenue and profit is inseparable from the adjustment of product structure. In 2021, due to factors such as semiconductor supply shortages, total Mercedes-Benz passenger cars and light commercial vehicle sales decreased by 5% y/y to 2.3302 million units, of which Mercedes-Benz passenger car sales also decreased by 5% y/y to 2.055 million units.
However, the high-end car series, which includes Mercedes-Maybach, Mercedes-AMG, G-Class, S-Class Sedan, GLS SUVs and EQS, set new sales records in 2021, with an overall growth rate of 30%. Since June 2021, the average monthly sales of Mercedes-Maybach in China have increased to more than 1,000 units. In addition, the company's all-electric vehicle deliveries for passenger cars and light commercial vehicles increased by 64 percent.
(EQS/Source: Mercedes-Benz official)
In terms of automation, the Mercedes-Benz L3 autonomous driving system was approved by the technical regulations of the German Federal Motor Transport Authority (KBA) in December 2021, becoming the first automotive company in the world to be certified by the UN-R157 regulation.
At the end of 2021, mercedes-Benz Group's industrial free cash flow was EUR 8.6 billion (2020: EUR 8.3 billion) and adjusted industrial free cash flow was EUR 10.9 billion (2020: EUR 9.2 billion). Even after the spin-off of Daimler Trucks, net liquid assets in the industrial business amounted to €21 billion (€17.9 billion at the end of 2020).
2022 profit margin will still exceed 10%
Mercedes-Benz expects semiconductor-related supply shortages to continue to impact market developments in 2022. However, the relevant supply situation will stabilize.
However, given the uncertainty arising from the current supply chain tensions, the group is cautious about overall sales expectations. Mercedes-Benz passenger car and light commercial vehicle sales are expected to be slightly higher than in 2021, but high-end car sales are expected to grow by more than 10%.
Mercedes-Benz expects the company's passenger car business to invest slightly more in real estate, plants and equipment and R&D spending in 2022 than in 2021, mainly due to investments in the platform architecture MMA and AMG.EA for all-electric models. The company's Passenger Cars segment is expected to have an adjusted sales margin of 11.5% to 13% in 2022.
(VISION AVTR concept car / Source: Mercedes-Benz official)
Meanwhile, VAN.EA, a new integrated pure electric model platform covering all segments of light commercial vehicles, is in the development phase and will be on the market by 2025. The company's light commercial vehicle business expects adjusted sales margins of 8% to 10% in 2022.
The Mercedes-Benz Group expects the company's turnover in 2022 to be slightly higher than the turnover level of its continuing operations in 2021. Based on expectations for a slight increase in turnover in 2022, mercedes-Benz Group expects EBIT from continuing operations to be flat with the previous year, EBIT cash flow from the automotive business and adjusted overall EBIT cash flow to be flat with 2021.
In 2022, the Mercedes-Benz Group expects cash taxes to return to more conventional levels, a significant year-on-year increase due to less carry-over of tax losses. As a result, the company expects free cash flow from its industrial operations for the same period to be slightly lower than in 2021 levels.
epilogue
Although sales have increased, Mercedes-Benz's sales of new energy vehicles in 2021 are still far lower than those of competitors such as Tesla and BMW. At the beginning of 2022, the company's main sales of the electric model EQC SUV also encountered a joint complaint from the owners in China, and officially announced on February 18 that it would be recalled.
(EQC SUV/Source: Mercedes-Benz Official)
Of course, the EQC SUV is an oil-to-electricity version. In 2021, the first model of Mercedes-Benz pure electric platform, the EQS, officially landed on the market and was listed in China in the fourth quarter. To date, the company's newly launched flagship luxury pure electric model EQS has received more than 20,000 orders, including 3,600 in January 2022.
In 2022, Mercedes-Benz plans to launch a series of new all-electric models, including the new EQE and the new EQS pure electric SUV. In January 2021, Mercedes-Benz also unveiled the new VISION EQXX, a pure electric concept car. The concept sports car has a drag coefficient as low as 0.17, energy consumption of less than 10kW/h per 100 km, and a range of more than 1000 km on a single charge. A production version of the concept car is expected to be unveiled in 2024.
With the emergence of more pure electric platform models, it is expected that Mercedes-Benz can make up for the shortcomings in electrification, so that the future growth road will be more solid.