The ratings on Germany-based automaker DaimlerChrysler AG reflect the broad product and geographic scope of its automotive operations. Over the past year, the group has benefited from the cyclical rebound in its commercial-vehicle markets and favorable conditions for its financial-services operations. Overall, we consider that the group is on track to reach management's 2006 operating-profit target of more than €6 billion. The ratings also reflect the ongoing restructuring activities at Mercedes Car Group (MCG). MCG enjoys a leading share of the global luxury-vehicle market–-a market that is relatively recession resistant. It generated an operating profit of €807 million in the second quarter of 2006--including €33 million in onetime expenses for staff reductions and smart-related charges--and its turnaround is not yet
