BERLIN, July 24 (Xinhua) -- Daimler AG has secured a new credit line of over 11-billion euros (12.9 billion U.S. dollars) to boost its electric- and autonomous vehicle development, the German carmaker announced on Tuesday.
The Stuttgart-based company said that the credit line had a five-year-term with the possibility of two extensions. "The funds will provide the company with financial flexibility until the year 2025", a statement by Daimler read.
The loan was obtained with a consortium of more than 40 international banks and was heavily oversubscribed in spite of the current low-interest rate environment. As a consequence, Daimler's financing cost declined relative to previous credit line transactions.
According to chief financial officer (CFO) Bodo Uebber, the favorable terms secured for the credit line underscored that "Daimler enjoys a high reputation in the banking world and that the banks trust our strategy and the future development of the company." He added that Daimler had now "created a long-term liquidity cushion for itself."
Daimler is currently preparing to make multi-billion-euro investments in new technologies like electric and self-driving vehicles as it seeks to weather far-reaching structural changes in the automotive industry. At the same time, the threat of a global trade war sparked by the policies of U.S. President Donald Trump has raised fears that earnings could be hit as exports of luxury vehicles fall.
In June, Daimler became the first major international corporation to issue a profit warning which was attributed to Washington's "America First" doctrine. The company emphasized in a statement to investors that it would not be able to fully offset the adverse effects of punitive import tariffs imposed by Trump and the retaliatory measures taken by other states in response.
Daimler also cited new global certification processes for the exhaust-systems testing of light vehicles, recalls of vans affected by the ongoing diesel emissions scandal as having contributed to its gloomier outlook for the year. The DAX-listed company recorded gross revenue of 164.3 billion euros in 2017 and employed over 289,000 staff across the world.
