DaimlerChrysler AG (NYSE:DCX) today reported significant increases for Second Quarter 2000 in net income, revenues, earnings per share, and operating profit, compared to the Second Quarter 1999.
Net income increased 18% to $1.7 billion while revenues grew by 17% to $41.7 billion. DaimlerChrysler's earnings per share (EPS) rose to $1.66, up 18%, compared to $1.41 in the Second Quarter of 1999. Operating profit gained 3% to $2.5 billion.

DaimlerChrysler achieved the strongest improvements in operating profit in the Mercedes-Benz Passenger Cars & smart, Commercial Vehicles and Aerospace divisions. Mainly due to the intense competition in the North American market, which also affects the residual values of leased vehicles, operating profit at the Chrysler Group and the Services divisions were below the level of the Second Quarter of 1999.

Schrempp: "Good performance in the Second Quarter"

"DaimlerChrysler performed very well in the Second Quarter of 2000," said DaimlerChrysler Chairman Juergen E. Schrempp. "We expect to sell about 4.8 million vehicles in 2000, maintaining our strong position in world markets. Mercedes-Benz Passenger Cars & smart will exceed last year's record sales. The recently announced acquisitions of Western Star and Detroit Diesel, as well as the major steps taken in Asia with Mitsubishi Motors and Hyundai Motor underline our strategy to focus on the automotive business. For the Chrysler Group, as the fierce competition for market share in North America continues, we will actively strengthen our outstanding market position. And we are continuing to improve our efficiency, our processes and our cost situation in all parts of the company."

For the First Half of 2000, revenues grew 17% to $80.8 billion. Adjusted for one-time effects, net income increased 10% to $3.3 billion, earnings per share also rose 10% to $3.27, and operating profit reached 1999's high level at $4.8 billion.

DaimlerChrysler expects significant revenue growth to continue in the Second Half of the year, mainly due to the positive outlook in almost all divisions. The numerous product launches in the Chrysler Group are expected to strengthen its market position. But expenses related to those launches, plus aggressive new marketing activities, will depress its operating profit in the Second Half, especially in the Third Quarter 2000. There will also be an impact on Financial Services earnings caused by sustained pressure on used vehicle prices.

The company expects that in the subsequent period, the new, attractive model mix will lead to renewed earnings improvement. Commenting on the earnings outlook for the full year, Schrempp said: "In the operative business, we will not fully match last year's level. However, with the income from the deconsolidation of Dasa and the positive effects from the first at-equity valuation of the IT Services joint venture with Deutsche Telekom, we expect to achieve a strong further increase in net income, earnings per share and operating profit. The gains from these changes in the DaimlerChrysler portfolio are the result of our previous years' successful work, and they add further to our financial strength, which we will utilize to invest in our future."

Schrempp noted that the Chrysler Group is embarking on the most ambitious product initiative in its history. As part of its rapid-fire rollouts, it is in the process of launching the Chrysler Sebring sedan and convertible and the Dodge Stratus sedan at the Sterling Heights (Mich.) Assembly Plant, along with the Sebring and Stratus coupes at the Mitsubishi Diamond Star Motors Corp. Plant in Normal, Illinois. Additionally, the new Chrysler minivans are in the launch assembly phase at plants in St. Louis, Missouri, and Windsor, Ontario. And the newly-launched Chrysler PT Cruiser already is at full production at its Toluca Assembly Plant in Mexico.

Mercedes-Benz Passenger Cars & smart

Following a successful 1999, the Mercedes-Benz & smart division continues on a fast track in 2000. The Mercedes-Benz brand has the newest product portfolio in the industry. Its S-, E-, C-, A- and M-Class products are clearly market leaders in the premium segment.

In the Second Quarter of 2000, the Mercedes-Benz Passenger Cars & smart division increased unit sales by 12% to a new record of 310,000 units and posted revenues of $10.9 billion, up 19%. The division's operating profit grew 22% to $719 million.

The biggest increase in unit sales among the main markets was achieved in the US, up 18%. In Europe, the new C-Class was a spectacular success. The very positive trend for the smart continued in the Second Quarter, with unit sales up 65% to 33,300 cars. For 2000 as a whole, Mercedes-Benz Passenger Cars & smart expects new records for both unit sales and revenues.

Starting in September, the C-Class will get an additional positive impetus when it is launched in the US and production of the right-hand drive version of this model begins for the United Kingdom and Japanese markets.

Chrysler Group

The Chrysler Group sold 851,000 vehicles in the Second Quarter, 2,000 more than in last year's Second Quarter. Revenues rose 11% to $17.2 billion, helped by the depreciation of the euro against the US dollar. Due to the intense competitive situation and increased investment for the development and launch of new products, operating profit did not reach last year's high level and decreased 12% to $1.1 billion.

With 29,800 units sold, the new Chrysler PT Cruiser was particularly successful. In the coming months, the Chrysler Group will strengthen its competitive position by launching a series of new models, such as the Chrysler Town & Country and Voyager minivans along with the Dodge Caravan minivan, the Sebring convertible and the Sebring and Stratus coupes and sedans. With new and innovative products, the Chrysler Group expects to build on its strong sales momentum.

Commercial Vehicles

The Commercial Vehicles division with its Mercedes-Benz, Freightliner, Sterling, Setra, and Thomas Built Buses brands, sold 145,000 units in the Second Quarter, up 2% from the same period last year. Revenues increased by 13% to $7.2 billion, with operating profit growing even stronger by 19% to $362 million.

Market shares improved in the NAFTA region, but unit sales were down from the extremely high level of last year. The introduction of the Sprinter van in the Second Half of 2000, under the Freightliner brand in the USA and Canada, is expected to further strengthen the division's market position. The strong recovery in South America resulted in a 20% increase in unit sales there to 12,700 vehicles. Despite the softening NAFTA market, DaimlerChrysler expects to again achieve for the full year 2000 the high unit sales and revenue level of the previous year.

The company anticipates the planned acquisitions of the commercial vehicle manufacturer Western Star, and the diesel engine manufacturer Detroit Diesel Corporation, will help further improve its competitive position in the North American truck and bus markets and in the worldwide diesel engine markets.

DaimlerChrysler Services (debis)

DaimlerChrysler Services (debis) achieved revenues of $4.4 billion, 50% above the Second Quarter of 1999. The strong growth was due mainly to the increasing leasing business in the NAFTA region. IT Services increased revenues by 12%, to $0.8 billion. Revenue growth, especially in Financial Services, is expected to continue during the remainder of the year.

Rising margin pressure, higher refinancing costs and the growing competition in the leasing business in North America resulted in a decrease in operating profit by 18% to $210 million. Pressure on margins and declining used vehicle prices in the US market will continue throughout the year. Additionally, globalization and Fleet Management activities in the Financial Services business will be expanded in the Second Half of 2000.

DaimlerChrysler Aerospace (Dasa)

The Aerospace division increased revenues by 6% to $2.3 billion. Operating profit grew strongly by 30% to reach $234 million, particularly due to positive trends in the Commercial Aircraft business.

On July 10, 2000, DaimlerChrysler Aerospace (Dasa), Aerospatiale Matra and CASA merged to form the European Aeronautic Defence and Space Company (EADS). DaimlerChrysler is the biggest shareholder in EADS, with an equity stake of about 30%. On the basis of a large order backlog and new, more competitive structures, EADS has tremendous growth prospects.

Other Industrial Businesses

In the Second Quarter, Adtranz, the rail business unit, increased its revenues by 31% to $1.0 billion. Adtranz broke even in the Second Quarter after making a negative contribution to earnings in the first three months. For the year as a whole, Adtranz is expected to achieve strong growth in revenues and will continue to implement the announced restructuring measures according to plan.

The Automotive Electronics business unit (TEMIC) posted an 11% increase in revenues to $241 million. TEMIC expects an increase in revenues of about 10% to more than $0.95 billion for the full year.

The MTU/Diesel Engines business unit recorded revenues of $194 million in the Second Quarter, down 4% from last year's level. For the whole year, MTU/Diesel Engines expects revenues of more than $0.95 billion for the first time.

DaimlerChrysler will broadcast its Half-Year Press Conference live on the Internet at the following Internet addresses:
www.daimlerchrysler.com

US dollar figures are for convenience only. All values, including the 1999 figures, are converted from Euro figures with the exchange rate of 1 Euro = USD 0.9545 (Noon Buying Rate of the Federal Reserve Bank of New York on June 30, 2000).
This press release contains forward-looking statements based on beliefs of DaimlerChrysler management. When used in this release, the words "anticipate," "believe," "estimate," "expect," "intend," "plan," and "project" are intended to identify forward-looking statements. Such statements reflect the current views of DaimlerChrysler with respect to future events and are subject to risks and uncertainties. Many factors could cause the actual results to be materially different, including, among others, changes in general economic and business conditions, changes in currency exchange rates and interest rates, year end accounting adjustments, introduction of competing products, lack of acceptance of new products or services and changes in business strategy. Actual results may vary materially from those projected here. DaimlerChrysler does not intend or assume any obligation to update these forward-looking statements.


DaimlerChrysler - Figures for 2nd Quarter/1st Half of 2000

U.S. dollar figures - convenience translation

All values, including the 1999 figures, are converted from Euro figures with the exchange rate of Euro 1 = U.S.-$ 0.9545 (Noon Buying Rate of the Federal Reserve Bank of New York on June 30, 2000).


DaimlerChrysler Group Q2 Q2 Change YTD YTD Change
values in U.S.-$ 2000 1999 00:99 2000 1999 00:99
Operating Profit,
in millions 2,507 2,436 (1) +3% 4,847 4,844 (1) +0%
Earnings Before Taxes,
in millions 2,691 2,286 +18% 5,346 4,706 +14%
Net Income,
in millions 1,668 1,416 (1) +18% 3,284 (1) 2,981 (1) +10%
Earnings per share
(EPS) 1.66 1.41 (1) +18% 3.27 (1) 2.97 (1) +10%
Revenues,
in millions 41,748 35,628 +17% 80,847 69,026 +17%
Employees 474,849 463,081 +3% 474,849 463,081 +3%
Operating Profit
by Segments Q2 Q2 Change YTD YTD Change
in millions of U.S.-$ 2000 1999 00:99 2000 1999 00:99
Mercedes-Benz Passenger
Cars & smart 719 588 +22% 1,283 1,095 +17%
Chrysler Group 1,110 1,262 -12% 2,401 2,652 -9%
Commercial Vehicles 362 304 +19% 597 479 +25%
Services 210 256 -18% 396 429 (1) -8%
Aerospace 234 180 +30% 346 269 +28%
Others (59) (164) +64% (129) (94) -38%
Revenues by Segments Q2 Q2 Change YTD YTD Change
in millions of U.S.-$ 2000 1999 00:99 2000 1999 00:99
Mercedes-Benz Passenger
Cars & smart 10,894 9,136 +19% 20,338 17,191 +18%
Chrysler Group 17,217 15,522 +11% 35,325 30,117 +17%
Commercial Vehicles 7,173 6,371 +13% 13,668 12,241 +12%
Services 4,376 2,915 +50% 8,152 5,579 +46%
Aerospace 2,344 2,213 +6% 4,114 4,045 +2%
Others 1,653 1,134 +46% 2,792 2,392 +17%
Unit Sales by Segments Q2 Q2 00:99 YTD YTD 00:99
2000 1999 2000 1999
Mercedes-Benz Passenger
Cars & smart 309,700 275,600 +12% 570,100 519,100 +10%
Chrysler Group 851,100 849,000 +0% 1,774,700 1,684,800 +5%
Commercial
Vehicles 145,100 142,300 +2% 281,300 269,900 +4%
1) adjusted for one-time effects


DaimlerChrysler - Figures for 2nd Quarter/1st Half of 2000
DaimlerChrysler Group Q2 Q2 Change YTD YTD Change
values in Euro 2000 1999 00:99 2000 1999 00:99
Operating Profit,
in millions 2,626 2,552 (1) +3% 5,078 5,075 (1) +0%
Earnings Before Taxes,
in millions 2,819 2,395 +18% 5,601 4,930 +14%
Net Income,
in millions 1,748 1,484 (1) +18% 3,441 (1) 3,123 (1) +10%
Earnings per share
(EPS) 1.74 1.48 (1) +18% 3.43 (1) 3.11 (1) +10%
Revenues, in
millions 43,738 37,326 +17% 84,701 72,316 +17%
Employees 474,849 463,081 +3% 474,849 463,081 +3%
Operating Profit
by Segments Q2 Q2 Change YTD YTD Change
in millions of Euro 2000 1999 00:99 2000 1999 00:99
Mercedes-Benz Passenger
Cars & smart 753 616 +22% 1,344 1,147 +17%
Chrysler Group 1,163 1,322 -12% 2,516 2,778 -9%
in U.S.-$ (June 30,
2000 exchange rate) 1,110 1,262 -12% 2,401 2,652 -9%
Commercial Vehicles 379 319 +19% 625 502 +25%
Services 220 268 -18% 415 449 (1) -8%
Aerospace 245 189 +30% 362 282 +28%
Others (62) (172) +64% (135) (98) -38%
Revenues by Segments Q2 Q2 Change YTD YTD Change
in millions of Euro 2000 1999 00:99 2000 1999 00:99
Mercedes-Benz Passenger
Cars & smart 11,413 9,571 +19% 21,307 18,011 +18%
Chrysler Group 18,038 16,262 +11% 37,009 31,553 +17%
in U.S.-$ (June 30,
2000 exchange
rate) 17,217 15,522 +11% 35,325 30,117 +17%
Commercial Vehicles 7,515 6,675 +13% 14,320 12,824 +12%
Services 4,585 3,054 +50% 8,541 5,845 +46%
Aerospace 2,456 2,318 +6% 4,310 4,238 +2%
Others 1,732 1,188 +46% 2,925 2,506 +17%
Unit Sales by Segments Q2 Q2 00:99 YTD YTD 00:99
2000 1999 2000 1999
Mercedes-Benz Passenger
Cars & smart 309,700 275,600 +12% 570,100 519,100 +10%
Chrysler Group 851,100 849,000 +0% 1,774,700 1,684,800 +5%
Commercial
Vehicles 145,100 142,300 +2% 281,300 269,900 +4%
1) adjusted for one-time effects