Daimler, the German auto company that manufactures Mercedes-Benz, has cut its 2019 revenue expectations by thousands of thousands of euros. The financial downgrade, announced on Sunday, is the latest fallout from the diesel emissions scandal that has rocked the German auto trade.
The company mentioned that “varied ongoing governmental proceedings and measures regarding diesel automobiles” will affect the corporate’s second-quarter earnings. It stated it expects a rise in the bills associated with these proceedings.
Daimler stated its revenue for 2019 can be near to the last year’s level.
Shares within the carmaker declined 3.6% in Frankfurt on Monday. The stock has dropped nearly 20% from the latest excessive in April.
German automakers have faced years of scrutiny relating to dangerous emissions that fuel automobiles manufacturer. That analysis stems from a 2015 admission by another German automaker — Volkswagen (VLKAF) — that it rigged millions of fuel engines to cheat on emissions tests.
The revelation trashed confidence amongst customers and regulators in diesel technology and cost Volkswagen tens billions of dollars in the recall, legal penalties, and settlements.
In April, the European Commission stated that Volkswagen, BMW, and Daimler (DDAIF)broke antitrust rules by acting together to delay the introduction of two emissions cleaning systems between 2006 and 2014.
Daimler said on the time that it has been “cooperating extensively” with the Commission and did not count to be fined.
Automakers, including Daimler, are investing in new technology in a race for the longer term as tech companies and upstarts like Tesla (TSLA) plow cash into electric and autonomous vehicles. Daimler decides to offer 130 electric and hybrid models by 2022, along with electrical vans, buses, and trucks.