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Daimler is developing a cost-cutting plan to achieve its efficiency goals, which will reduce management costs by about 20%.

Daimler's net profit in the first quarter of 2019 was 2.15 billion euros, down 9% from the previous year, and pre-tax profit fell to 2.8 billion euros, down 16% from 3.35 billion euros in the first quarter of 2018. Mercedes-Benz sold 560000 vehicles in the first quarter, down 7% from a year earlier, while Daimler's operating profit fell 22% to 11.1 billion euros in 2018.

The main reason for the decline in Daimler's profits is also due to a decline in global sales of Mercedes-Benz in the group's business models, and spending on electric and self-driving cars has led to rising research and development costs for Mercedes-Benz.

As a result, Kang Linsong, president of Daimler, said they had been committed to a cost-cutting plan called "Move", which would achieve a cost cut of about 20 per cent.

Earlier, Daimler announced that Daimler's director and group president of Mercedes-Benz will officially step down on May 22 and will be replaced by Kang Songlin, Daimler's R & D director and board member for a five-year term.

Some time ago, Daimler was planning to significantly reduce Mercedes-Benz's R & D costs and improve efficiency targets by 2025. It is hoped that by expanding the production scale of low-cost electric vehicle batteries, the use of expensive battery materials will be reduced.

In April, Kang Linsong planned to cut 10000 jobs in an effort to promote cost-saving plans, making Daimler's structure leaner and reducing costs by 6 billion euros by 2021.

Daimler faces a variety of difficult challenges, including the increased cost of developing electric cars and the impact of depressed sales. The luxury carmaker needs to find the right way to reduce costs and achieve profit growth.

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