MB Fined$20M
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2021 M550i
MB Fined$20M
https://www.yahoo.com/autos/mercedes...174700091.html
Hmmm, they are either going to have to cut costs or make us pay more for our cars to re-coup the $20M.... either way it seems like they have lost interests in repairing our cars or making them properly in the first place! lol
Hmmm, they are either going to have to cut costs or make us pay more for our cars to re-coup the $20M.... either way it seems like they have lost interests in repairing our cars or making them properly in the first place! lol
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This was simply a paperwork glitch in the Orwellian NTHSA rules. The amount of the fine is simply a cost of doing business. It is immaterial to the MBUSA income statement or the Daimler balance sheet. That is less than twelve hundredths of 1 percent of the DDAIF revenue for 2018.
Per the article:
The $20 million fine is a wrist slap compared to what NHTSA has fined other automakers for recall violations in recent years. In 2015, the agency fined Honda $70 million for missing safety data and Fiat Chrysler twice for that same amount. The agency can fine automakers under federal law for violations of Federal Motor Vehicle Safety Standards.
The $20 million fine is a wrist slap compared to what NHTSA has fined other automakers for recall violations in recent years. In 2015, the agency fined Honda $70 million for missing safety data and Fiat Chrysler twice for that same amount. The agency can fine automakers under federal law for violations of Federal Motor Vehicle Safety Standards.
Last edited by ua549; Dec 21, 2019 at 09:46 AM.
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This was simply a paperwork glitch in the Orwellian NTHSA rules. The amount of the fine is simply a cost of doing business. It is immaterial to the MBUSA income statement or the Daimler balance sheet. That is less than twelve hundredths of 1 percent of the DDAIF revenue for 2018.
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This is a MBUSA fine. Not a Daimler AG fine. At 20 million, heads will/should roll. 20 Million is 200 S classes at 100k each and we are not even talking about profit here. If each S class made 10k in profit (which they absolutely do not) then that is 2000 S classes. Either way, this is proof that they are less concerned about quality and they are heavily into production these days. Hence, the cause of all our stress and complaints.
Think about how many new models and cars they have been producing since a few years back. While Dr. Z's reign, the company wasn't doing so well and he quickly had to change his philosophy... fortunately for him he did extend his time at the company one more time before leaving for retirement. From my point of view, the company has refocused into looking after profitability more than before, instead of looking into exclusivity,reliability and quality. This is just my thought tho... you can easily tell this by all their lineups starting to look the same.
Think about how many new models and cars they have been producing since a few years back. While Dr. Z's reign, the company wasn't doing so well and he quickly had to change his philosophy... fortunately for him he did extend his time at the company one more time before leaving for retirement. From my point of view, the company has refocused into looking after profitability more than before, instead of looking into exclusivity,reliability and quality. This is just my thought tho... you can easily tell this by all their lineups starting to look the same.
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2020 MB E450 Estate, 2019 Kia Niro Touring
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I agree. Plus that's relatively speaking. What you can do with 20M vs 275 dollars is substantially different. 20M could have been spent on an investment, R&D or anything else that could have returned the investment back in double... or at least in the bank!
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The fines were about not meeting 5 day and 40 day arbitrary deadlines set by the bureaucracy. They had nothing to do with quality (or lack thereof). Every brand has many NHTSA events each year. MBUSA is merely a division and integral part of Daimler AG. Even though 2018 was not a very good year, DDAIF had a greater than 11% return on equity. I appreciate that because dividends are above 6.5%. As a shareholder I care more about the company's profitability than the "prestige factor" of owning a Daimler AG product. The bottom line is a Mercedes car is just that, a car similar to other lux brands available for purchase.
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I kind of think most of the quoted figures above are off, though. MB sold 134,642 cars in the US as of June 1, which if it continues, gives about 323,000 cars sold this year (very approximately - it's probably not linear, and mine isn't bought yet). So wasting $20 million gives an average of $62 per car. Nothing like quoted above, but I GUARANTEE you that any auto manufacturer is hurt by losing $62 per car, and has spent many millions trying to reduce the price per unit less than that.
so its really only 14 million on the books.
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That is NOT $275 on each and every S Class vehicle! The comparison is on profit not sales or revenue. US per vehicle sales comparisons are not relevant for an international company. You are comparing apples to oranges. Daimler is not losing any money on any of the vehicles they produce. If you have $100,000 net income (after taxes) the $275 comes off that. $275 is more like an afternoon at a sporting event or an evening out for someone with $8,333 cash in their pocket each month. It is an inconsequential expense in the overall DDAIF financial performance.
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At any rate $20M is huge, you can hire execs, consultants, marketing, the possibilities are endless. It's definitely going to leave a bitter taste in their mouths for sure.... just unfortunate... whether for them or for the consumer. Hope they can negotiate the fine!
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Fines and penalties are not tax deductible
Corporate tax rate is 21%. This is moot as penalties and/or fines are not tax deductible. But if they were, the after tax cost would be $16 million not $14.
Corporate tax rate is 21%. This is moot as penalties and/or fines are not tax deductible. But if they were, the after tax cost would be $16 million not $14.
Last edited by JTK44; Dec 22, 2019 at 08:36 AM.
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Actually it is $12 million a year for 27 years, total $324 million not $1.4 billion
see:https://www.autonews.com/article/201...lcons-new-home
additionally Mercedes spent between $50 and $60 million for naming rights to the Super Dome in New Orleans.
see: https://www.sportsbusinessdaily.com/...Superdome.aspx
see:https://www.autonews.com/article/201...lcons-new-home
additionally Mercedes spent between $50 and $60 million for naming rights to the Super Dome in New Orleans.
see: https://www.sportsbusinessdaily.com/...Superdome.aspx
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Want to hear something crazy about all that? So in 2015 Steve Cannon (MB CEO at that time) moves the US headquarters from NJ to Atlanta, obviously many families/employees were impacted by this.... right afterwards he resigns as the CEO and goes works for the Falcons... everyone was extremely pissed/upset about that....now it looks like the current MB CEO is following his old boss' footsteps...
https://www.autonews.com/executives/...ts-parent-firm
https://www.autonews.com/executives/...ts-parent-firm
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Sorry, the stadium cost $1.4 billion - not the naming rights.
When working for Falcons was mentioned I had to check the name because the first one that came to mind was NAFA, North American Falconers Association. They hold many events in Georgia.
When working for Falcons was mentioned I had to check the name because the first one that came to mind was NAFA, North American Falconers Association. They hold many events in Georgia.
Last edited by ua549; Dec 22, 2019 at 10:17 AM.
