Report: Daimler Targets 20% Cut in Administrative Costs

Ola Kallenius, who will take over as CEO of Daimler AG on May 22 when Dieter Zetsche retires, aims to slash the company’s central administrative costs by 20%, sources tell Handelsblatt.

The German financial daily says the cuts will be detailed in a plan called “Move” that Kallenius (pictured) will unveil this summer. The Handelsblatt report follows one last month by Manager Magazin that says Daimler aims to cut costs at its passenger car and commercial vehicle operations a combined €8 billion ($89 billion) by 2021.

The goal of the program is to bolster Daimler’s profit margins in the face of trade wars and new-vehicle launch costs. Daimler’s net profit dropped 28% last year.