By Max Bernhard
Daimler AG (DAI.XE) said Thursday that its planned ride-hailing joint venture with BMW AG (BMW.XE) will be established later than expected, leading it to cut the earnings outlook for its financial services unit.
"Completion of the transaction, which was originally planned for 2018 and continues to be pursued by both partners, can no longer be achieved in the remaining weeks of this year," Daimler said.
The two German manufacturers, who usually compete in the premium auto segment, are continuing talks with U.S. antitrust authorities and now expect to close their deal at the beginning of next year, Daimler said.
Daimler had expected the deal to result in a significant positive earnings contribution for its financing unit, which it said will now be realized in 2019. The company therefore cut its 2018 outlook for the division. It now expects Daimler Financial Services' earnings before interest and taxes to be significantly lower than in the previous year.
Daimler's earnings forecast remains unchanged, it said.
Daimler and BMW decided to join forces in March to better handle competition from technology giants such as Uber Technologies Inc (UBERI.XX) and China's Didi Chuxing Technology Co. They plan to combine their car-sharing units, as well as there ride-hailing and electric-vehicle-charging services, in a new joint venture to be headquartered in Berlin.
The European Union has already approved the deal.
Write to Max Bernhard at email@example.com; @mxbernhard
(END) Dow Jones Newswires
December 06, 2018 11:04 ET (16:04 GMT)
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