To prioritize investments where management sees better chances, spending on capital expenditures and research and development are being capped at a combined €16 billion for Mercedes. Materials costs will be reduced by a cumulative 3 percent over three years, and personnel costs are to be cut by more than €1 billion through the end of 2022.
“We have too many plants in Germany,” said one senior manager who declined to be named. “But the works council leaders on our board are locally elected by employees at their respective plant, so naturally they won’t allow us to close any — even though they themselves know it’s necessary.”
Källenius, appointed to the board in 2015 when he was sales chief, assured shareholders that he would not accept another year like 2019. “It’s not good enough. It’s not what this company deserves, and it’s not what these brands stand for,” he told reporters and financial analysts, pledging to restore results over a three-year rebuilding phase. “I will work 24/7 with this management team to make that happen so that the numbers we present today hopefully represent somewhat of a turning point.”
Next month, as part of a broad reorganization, he will take charge of the vans unit at a board level and Wilhelm will act as CFO of Mercedes-Benz, as well as the parent company. Daimler also appointed Markus Schäfer to the newly created post of operations chief.
