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Daimler, BMW boost sales
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October 20, 1999: 6:44 a.m. ET
German-based automakers see another record year after strong 9-month data
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LONDON (CNNfn) - DaimlerChrysler and BMW released strong nine-month sales data Wednesday, and said they were on course for another record year.
Stuttgart-based DaimlerChrysler said global revenue from its car and light truck units jumped 12 percent to 73.9 billion euros ($80 billion), on a 6 percent jump in unit sales of 3.2 million vehicles.
Unit sales of its four U.S. brands -- Chrysler, Plymouth, Jeep and Dodge -- rose three percent to 2.4 million euros, while revenue jumped 10 percent to 46.7 billion euros.
U.S. sales got a strong boost from a surge in sales of the Jeep Grand Cherokee. Analysts said sales of this leisure vehicle have jumped 114 percent over last year, after the company "over-incentivized" its car dealer network.
The United States accounted for the bulk of the sales of the four vehicles, with 2 million units sold there.
Unit sales for DaimlerChrysler's Mercedes-Benz and Smart compact car brands jumped 20 percent to 784,600 vehicles, with revenue up 15 percent to 27.2 billion euros.
"The Mercedes-Benz brand is doing very well, but we knew what to expect from these numbers as we were given a good of idea of what to expect at the eight-month stage," Zee Tull, auto analyst at Merrill Lynch, told CNNfn.com. Merrill Lynch has a neutral stance on the company's shares.
DaimlerChrysler briefed analysts at the Frankfurt Motor Show late last month on current sales performance after a number of surprises in its six-month results knocked its shares some 10 percent on the day of their release.
"This year is shaping up for another record year of sales, and it comes as we are embarking on an unprecedented wave of new product introductions and partnerships that will fuel our growth into 2000 and beyond," said James Holden, president of DaimlerChrysler Corp.
DaimlerChrysler's shares were up 1 percent in Frankfurt Wednesday at 69.90 euros. Their U.S. shares closed Tuesday at 74-3/8, up 1-11/16.
The company is due to report its third-quarter results next Tuesday.
Munich-based BMW beat most forecasts with a 4.8 percent rise in sales to 24.7 billion euros, and said it was on track to at least match its record 1998 results for the full year.
Total unit sales fell 1.2 percent to 895,932 units, hit by a 30.4 percent fall at its struggling U.K. subsidiary Rover. This disguised a 10 percent rise in BMW brand car sales to 568,154 units.
"The BMW brand is continuing to fly . . . the new 3-series is leading the way," said Tull.
"But perhaps more significantly, there is light at the end of the tunnel for Rover," she added. Despite the drop-off in sales, the Rover unit increased its share of its core U.K. market to 5.8 percent from 3.4 percent over the same period last year.
"It finally looks as though it is coming good for BMW," said Tull, who has an accumulate recommendation on the stock and a share price target of 42 euros.
BMW shares were modestly higher at 28.45 euros in Frankfurt.
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