Mercedes-Benz Bank achieves record earnings and a record market share in 2010
OFFICIAL PRESS RELEASE
- Profitability increases as a result of declining risk costs and favorable refinancing conditions
- New business up five percent to €8.5 billion in the vehicle financing and leasing sectors
- Further strengthening of sales support activities, increase in market share
- Good business potential this year due to new vehicle models
Stuttgart, Germany, Mar 16, 2011 - Mercedes-Benz Bank can look back on a very successful business year in which the Stuttgart-based company achieved record earnings and a record market share. “In addition to further improving our competitive position regarding the financing of Daimler vehicles, we have also substantially increased our profitability — thanks to declining risk costs and good refinancing conditions,” says Peter Zieringer, CEO of Mercedes-Benz Bank AG. “As a result, we were able to make a big contribution to the earnings of Daimler Financial Services, which amounted to €831 million in 2010.
The bank’s new business in the financing and leasing sectors of Germany’s difficult automotive market rose by five percent to €8.5 billion. The increase enabled the automotive bank to further boost its market share of Daimler passenger car and commercial vehicle sales from 53 percent in 2009 to 55 percent last year. In 2010, the bank’s total contract volume remained unchanged from the prior year, at €16.1 billion.
Zieringer is also optimistic about business year 2011. “Mercedes-Benz will launch many new models this year, including the new B-Class, C-Class, and M-Class, as well as the new CLS and SLK. In combination with our strong competitive position, this will provide us with a great starting point for another successful year,” says Zieringer.
Mercedes-Benz Bank also expanded its strategically valuable insurance business last year, increasing the number of contracts by 11 percent, to 397,000. By brokering motor insurance, the premiums for which are included in the monthly leasing or financing rates, Mercedes-Benz Bank is responding to customers’ growing demand for mobility packages. Mercedes-Benz motor vehicle insurance ensures that damage is expertly repaired at authorized Mercedes-Benz workshops, using genuine replacement parts. This enables the bank to maintain the vehicles’ value for the customers and at the same time generate additional revenues for dealerships and the Daimler Group.
Volume of deposits in the direct banking business ensures sufficient liquidity
The volume of deposits in the direct banking business was cut back from €12.6 billion in 2009 to €10.9 billion at the end of last year. “We cut back our deposit volume somewhat last year in response to the substantial improvement in business prospects and the continued favorable refinancing conditions. Our current deposit volume puts us in a good position from which we can continue to provide private and commercial customers as well as Mercedes-Benz dealers with affordable loans and thus help boost sales at Daimler,” says Zieringer.
FlexibleStars leasing exchange successfully launched
A few weeks ago, Mercedes-Benz Bank launched a new mobility solution called FlexibleStars. With this step, the company has become the first automotive bank to offer an exchange where customers can obtain or transfer ongoing leasing contracts. “FlexibleStars is a real alternative to traditional leasing for customers who would like to use a car for several months. It enables us to attract new customers — including customers from the younger age group — to the Mercedes-Benz brand,” says Zieringer. FlexibleStars allows existing customers to easily get out of a leasing contract — for example, should they decide they would like to drive a newer Mercedes-Benz or smart model.
In 2011 and 2012, Mercedes-Benz Bank will restructure its business activities as previously announced. In this context, it will also open a new service center in the heart of Berlin, where up to 700 employees will work over the medium term. The new service center will strengthen the company’s competitiveness by extending service times, accelerating processes, and reducing costs.
Due to its good competitive position and liquidity situation, Mercedes-Benz Bank is optimistic about 2011. The company plans to retain its high market share in the leasing and financing business. Over the medium term, Mercedes-Benz Bank is preparing itself to deal with a further increase in the volume of Daimler’s vehicle business in Germany.
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