- General Conditions
- Liquidity / Capital Resources
- Financial Position
- Daimler AG
- Economic Situation
- Events after 2009
- Risk Report
In the context of its normal business operations, the Group has entered into other financial commitments in addition to the liabilities shown in the consolidated balance sheet at December 31, 2009. These other financial commitments primarily relate to purchasing commitments and commitments to invest in plant replacement and expansion. The Group has also committed to lease payments in connection with rental and leasing agreements. In addition, particularly Daimler Financial Services has made irrevocable loan commitments within the framework of its business operations. The table below provides an overview of these other financial commitments and their maturities:
|Payments falling due
1 and 3 years
4 and 5 years
|in millions of €|
|Purchasing agreements, purchase or investments in property, plant and equipment||4,463||4,025||422||15||1|
|Future lease payments under rental and leasing agreements||2,372||304||524||427||1,117|
|Irrevocable loan commitments||1,587||735||852||-||-|
The Group’s off-balance-sheet transactions relate to transactions in the context of which Daimler provided guarantees and thus continues to be subject to risk. However, this does not include warranties the Group provides on its products in the context of its vehicle sales.
The guarantees reported by the Group (excluding product warranties) principally represent financial guarantees that require us to make certain payments if a guarantee holder fails to meet its financial obligations. The maximum potential obligation resulting from these guarantees amounted to €1.5 billion at December 31, 2009 (2008: €1.9 billion); the corresponding provisions amounted to €0.2 billion at the end of the year (2008: €0.3 billion).
Most of the financial guarantees relate to the situations described as follows: In connection with the transfer of a majority interest in Chrysler in 2007, Daimler guaranteed payments of up to US $1 billion into the Chrysler pension plans; this guarantee was reduced to US $200 million in 2009. The Group also provided guarantees for other Chrysler obligations; at December 31, 2009, these guarantees amounted to €0.3 billion, whereby Chrysler provided €0.2 billion on an escrow account as collateral for the guaranteed obligations. Another financial guarantee of €0.1 billion relates to bank loans of Toll Collect GmbH, the operator company of the toll-collection system for trucks in Germany. Other risks arise from an additional guarantee that the Group provided for obligations of Toll Collect GmbH towards the Federal Republic of Germany. This guarantee is related to the completion and operation of the toll-collection system. A claim on this guarantee could primarily arise if for technical reasons toll revenue is lost or if certain contractually defined parameters are not fulfilled, if the Federal Republic of Germany makes additional claims, or if the final operating permit is not granted. Furthermore, arbitration proceedings have been initiated against the Group. The maximum obligation that could result from this guarantee is substantial, but cannot be reasonably estimated.
Furthermore, the Group has issued a number of smaller guarantees, some of which specify that Daimler guarantees the financial obligations of companies which supply us with parts or services or which lease production facilities to us.
Agreements whereby we guarantee specified trade-in or resale values for sold vehicles result in guarantees under buy-back commitments for the Group. Most of these guarantees provide the holder with the right to return purchased vehicles to the Group if the customer acquires another vehicle from Daimler. At December 31, 2009, the maximum potential obligation from these guarantees amounted to €0.7 billion (2008: €0.7 billion); the corresponding provisions amounted to €0.1 billion at the end of 2009 (2008: €0.1 billion).
Further information on other financial commitments and contingent liabilities from guarantees granted as well as on the electronic toll-collection system and related risks is provided in Note 28 (Guarantees and other financial commitments) and Note 27 (Legal proceedings) of the Notes to the Consolidated Financial Statements, respectively.