Michael Muhlbayer - Head, IR, and Treasury Dieter Zetsche - Chairman and Head of Mercedes-Benz car Bodo Uebber - CFO Andreas Renschler - Head, Daimler Trucks

John Lawson - Citi Investment Research Christian Breitsprecher - Macquarie Stuart Pearson - Morgan Stanley Horst Schneider - HSBC Trinkaus & Burkhardt AG Stephen Reitman - Societe Generale Arndt Ellinghorst - Credit Suisse Philippe Houchois - UBS Jose Asumendi - RBS Fraser Hill - Bank of America Frank Biller - LBBW Charles Winston - Redburn Partners Ranjit Unnithan - J.P. Morgan

Welcome to the Global Conference Call of Daimler. At our customer’s request, this conference will be recorded. The replay of the conference call will also be available as an on-demand audio webcast in the Investor Relations section of the Daimler website. After The short introduction will be directly followed by a Q&A session. (Operator Instructions) I would like to remind you that this teleconference is governed by the Safe Harbor wordings that you find in your published results documents. Please note that our presentations contain forward-looking statements that reflect management's current views with respect to future events. These forward-looking statements can be identified by expressions such as, assume, anticipate, believe, estimate, expect, intend, may, plan, project, and should. Such statements are subject to many risks and uncertainties, examples of which are set out in the Safe Harbor wordings in our annual disclosure documents and are also described in our risk report in the Daimler Annual Report and in the most recent interim report. If the assumptions underlying any of these statements prove incorrect, then actual results may be materially different from those expressed or implied by such statements. Forward-looking statements speak only to the date on which they are made. May I now hand over to Dr. Michael Muhlbayer, Head of Daimler Investor Relations and Treasury. Thank you very much.

Well speaking on behalf of Daimler, I would like to welcome you on both the telephone and the Internet to our Q2 result Conference. We are happy to have with us today the Chairman of the Board of Management and Head of Mercedes-Benz car, Dr. Dieter Zetsche; our CFO, Bodo Uebber and the Head of Daimler Trucks, Andreas Renschler. In order to give you maximum time for your questions, Dieter Zetsche begin with his short introduction directly followed by Q&A. now I would like to hand over to Dieter Zetsche.

Thank you Michael. Ladies and gentleman. We announced our second quarter numbers earlier today. And they are good numbers. At the Group level we posted EBIT of €2.6 billion that’s an increase of 23%, compared to the previous year in one of our all time best quarterly results. Group earnings at €1.7 billion were also at a record level. At the same time our industrial operations generated solid free cash flow, in spite of Mercedes investment in new product technologies and markets. In the second quarter it reached €1.1 billion. Our net equity remains tight, although it paid out roughly €2 billion in dividend. So how did our individual divisions perform from April through June. Let’s start with our present our car business which sold more vehicles than ever before in the second quarter even compared to the first quarter of this sales climb further still at both Mercedes Benz and Smart. Production is in the fast lane, with exception of those plants affected by model changes all others are running with extra shifts we anticipate continuing production rise through summer and next winter. At €1.6 billion our results at Mercedes Benz cars also set a new best never before has second quarter EBIT at our passenger car division been higher. Our return on sales was 10.7% and with that we exceeded our targeted long-term average mark of 10% in the second quarter and with an RS of 10% for the entire first half we are right on track on the product side our new model offenses continues unabated after bringing the refresh C-Class the new C-Coupe and the new SLK to the market in the first half we are now at even more the new M-class will be available in the fall in addition with sound charge on the compact segment at the international motor show in Frankfurt where we will introduce our new V-Class we believe we can achieve sales of more than 1.35 million units for the year and that would fulfill our expectation of making and grow through year of automobile a record sales year. Full year results for our passenger car business are likely to be higher than 2010 even if EBIT in the second half is likely under that of the first half due to our many product launches unfavorable development in currency exchange rates and higher raw material costs. On the whole our trends to our sustainable high profitability will continue now how do you think Standard Daimler trucks the short answer is also good business is picking up across Europe, Latin America our truck sales increased by nearly one third Actros NAFTA sales are up by more than one and a half sales were only down at Truck Asia as a result of production interruptions at our suppliers in Japan the good news is this of all the catastrophe in Japan had a less dramatic effect on Fusu than Fiat we have booked a total of €38 million in extraordinary expenditure in the first half related to damages and production losses there was added pressure due to a sharp drop in sales and revenues worldwide our commercial truck business recorded EBIT of €474 million in the second quarter and the second half of this year we expect on the one hand high expenditure that Daimler trucks is primarily due to preparation for the Euro VI standard the mass introduction of the new Actros, as well as our continued expansion in growth markets. On the other hand our truck business will noticeably pick up our order books are well filled incoming orders in the first half of the year were consistently higher than sales the bottom line is that truck second half EBIT will come in higher than the first. One of the many sources of our confidence in the truck business is the as I mentioned Actros we are convinced it’s the best product in the market by far we put ten years and invested about €2 billion into the development of this truck and both will now pay off at the same time with the requisition of Tognum will create an additional source of revenue that is closely tied to our core business together with Rolls Royce we secured 94.2% of the stock at the close of the offering period. Turning now to our van business it generated EBIT of €206 million in the second quarter that’s the second best results in the past ten years return on sales was 9.2% again even higher than our long-term objectives. In the second half we intend to make a strong improvement in sales first and foremost in China where the market launch of Sprinter is eminent Daimler buses generated second quarter EBIT of €61 million, while business in Latin America and Turkey is doing well the market for complete buses in Western Europe and North America remains weak 2011 full year sales of Daimler buses should still come in higher than last year Daimler Financial Services with EBIT of €340 million markedly exceeded the prior years result expenditures for it and interest rates both developed advantageously we anticipate further growth in new business and contract volume in the second half. So much for current development and our perspective and our individual businesses Next what does this all mean for our outlook at the Group level. For the full-year Group EBIT from ongoing business is developing better than expected it will clearly come in higher than the pervious year s results one reason is our good performance in the first half another is the continued improvement in automobile markets that leads us to expect that 2011 full-year revenue will significantly top the €100 billion mark this all goes to show that in mid 2011 we are not only on plan, but ahead of it. Yet we are still not yet driving our highest gear. We are capable of more. Therefore we are confident. We are on the right path to achieve our long-term average, return on sales goals on a sustainable basis in 2013 at the latest. And now Renschler, Bodo Uebber, and I look forward to your question. Thank you.

Thank you very much Dr. Dieter. Ladies and gentlemen you may ask your questions now. I will identify the questionnaire by name. But please also introduce yourself with your name and the name of the organization before asking your questions. To practical points. Firstly please avoid English mobile phones and secondly please ask the question in English. Before we start the operator will explain the procedure.

(Operator Instructions)

So we will take the first question from John Lawson. John Lawson - Citi Investment Research: Thanks very much indeed. Good afternoon, John Lawson from Citi. Could I just ask about the costs that you must have incurred even if not of an extraordinary nature, but certainly rather high costs in Japan in the quarter. You were 7000 trucks down in Asia deliveries overall. I mean is that a reasonable guide to your lost production in Japan. And can you help us in any further way to understand the financial impact of that disruption in the second quarter? Second question, you did have a very hefty, I think around 26% ROE in your financial services in the second quarter. That’s quite materially above your guidance for the running rate and I wondered if you could help us understand how clean the financial services number is. Whether there is much provision release still running through there. And then finally I note your decision on funding pensions or pending decision on that. You’ve got just over $5 billion, if I’m not wrong of under funded status in Germany at the moment. Do you plan to fully close that gap overtime or is this the $2 billion the measure of it. Thank you.

Hi John. I will try to answer your first question in terms of the situation at Japan. First of all the second quarter of Fuso is from March to May. That is always one month behind. So that was more or less fully impact the second quarter at Fuso from there was break in all this all the issues that are connected with that. Basically it’s tough to say. Like we said production was more or less on a very limited number that’s close to zero because we had no supply of who could deliver it and though we lost. If we compare this to the second quarter of 2010, at least $300 to$400 million in revenue. This gives you an indication to that and of course domestic market is a very important one for us at Fuso. For the Japanese market in other words and this includes of course after that in sales that we lost there. John to your remaining questions, first to your financial services question whether the $340 million are clean in the run rate so we had € 20 million of releases of provisions. So that makes it 340 pretty clean it’s 320. I do expect the next quarter with a run rate of $250 million. It depends a little bit on the credit loss development. If it is so low as it was of course in second quarter, needs to be seen. So I do think $150 million in quarter is all to come.

Your question to pensions. With regard to pensions we will put and get decided in the supervisory board. So we have the official go to do that and we will put $2 billion once into the German pension plans $1.5 million most probably in the third quarter and $500 million in the fourth quarter and that’s it.

So we have no further plans or further steps in this regards

Okay, we take the next question from Christian Breitsprecher. Christian Breitsprecher - Macquarie: Good afternoon. Its Christian Breitsprecher from Macquarie. I have a question with regard to your guidance, I mean on the one hand I think you said that potentially H1 came in better than expected, but when we look at the general macro framework I think the conditions have become probably tougher than what they look like five to six months ago. So, what I want to know, how is your confidence with regard to the second half of this year has that also improved significantly versus what the picture looked like three four months ago or is the upgrading guidance mainly is function of the very strong first half.

Well it’s a combination of both, off course we see what’s going in and we have seen in the Europe so in China and we see the clouds and increased risks, at the same time we will see our order intake, we will see the mood in our markets. And we are definitely retching up and production going to -- on the car sides to the last only possible in order to satisfy to a highest and already existing demand. We were not able to fulfill their demands in the first half to the full extent because of the lack of production. So, yet we have those both aspects, increased risk, but stronger expectation for the second half independent on first half, and then we glean for at the beginning of the year. That is true for our cars and its pretty much true for trucks as well. Okay. Next in line is (inaudible).

Questions from me two for Mr. Rentschler. First of all on Fuso, could you give us a feel for when you expect Fuso to be back fully operational, so that we will be in the position to judge whether or not Fuso on an underlying basis is actually successfully turned around given that we are coming to the end of your restructuring actions. And then secondly, with regards to North America you have obviously followed the common just division back car, could you just give us some feel for where we stand with regards to supply or shortages and so forth and with regards to production volume ramp up. And then thirdly, you said that you are going to inject $2 billion into your pension fund, historically when we have seen something like that at competitors then normally the other side gives up something as well. At the end of the year, this was the dividend cap, what is it that Daimler, have you injected the $2 billion and got something from the work force back for that or is it just going in order to fund existing liabilities. Thank you.

Mr. Gaga, I would like to start with your truck related question, first to Fuso since 200% production that will impact of course third part of all mix it some how a little bit differently, but still we are on a good way to recover. Order backlog is very good because the order intake already took momentum latest in May, and so now the question is what can we produced and how can we how fast can we deliver it in the so called third quarter and off course in from the second quarter on we expect to be positive if we can. Then you can also start the restructuring issues like you mentioned before. In NAFTA it’s indeed there, but the ramp up is going according to our plan like we explained also a couple of weeks ago. We are increasing production over the month, we started in Mexico like I described once in all. The American plans are coming into the capacity in extension. Off course, there are months where you have certain supply of shortages because if the whole industry goes up that could be a months that you are missing some parts but like I mentioned it’s a very good partnership of suppliers went into the 2011 with a very, very high volume already, and so we have a good chance that we can such mindfully orientated issues over compensate over the year. So production ramp up is likely planned in NAFTA.

We will be on discussions with Unions with the German with deep thoughts of negotiation over new pension plan, this we have an understanding that this pension plans would be a defined contribution plan and it should be implemented towards the end of the year.

Okay, thank you that’s clear. I am just following up on Fuso Mr. Rentschler, usually in most of these events there is reconstruction activity going on from today’s standpoint do you see that in your order intake and should we therefore expect a stronger than normal 2012?

I cannot feed so long knowledge or intake but the momentum seems to be there we saw as I said already a momentum in the May in the months of May when it comes to order intake if its sustainable if it goes through things it looks like that we see there a good change for 2012 in Japan besides everything else you know we mentioned before certain other issues around the world, but when you look to the local area of Japan there is a good chance of 2012.

Okay our next in line is Stuart Pearson. Stuart Pearson -: I just had a few questions relating to Mercedes into the second half just start with the second quarter there on the average selling price maybe you could just explain a little bit more decline in the second quarter versus Q1 and how much that is seasonal and how much of that to do with currency and how that might evolve into the second half. The second question is on your utilization rates maybe, if you could update some of the utilization of the rest of that plants in the second quarter and any idea or how much of a burden that has been on profitability and how that might develop in the second half and just finally given what you have said on the high utilization rates through the summer you just talked about the pricing outlook into the second half of the year maybe just confirm your pricing position in the second quarter versus Q1 was that an increase or flat on quarter-on-quarter or a decline, thank you.

I just had a few questions relating to Mercedes into the second half just start with the second quarter there on the average selling price maybe you could just explain a little bit more decline in the second quarter versus Q1 and how much that is seasonal and how much of that to do with currency and how that might evolve into the second half. The second question is on your utilization rates maybe, if you could update some of the utilization of the rest of that plants in the second quarter and any idea or how much of a burden that has been on profitability and how that might develop in the second half and just finally given what you have said on the high utilization rates through the summer you just talked about the pricing outlook into the second half of the year maybe just confirm your pricing position in the second quarter versus Q1 was that an increase or flat on quarter-on-quarter or a decline, thank you.

Sorry, when we try to somewhat structure there per unit revenue effects you were talking about I say there are three elements structure mix then secondary business, which means that we are not realizing the revenues right away, but overtime and third as a combination of net pricing and foreign exchange rates that three elements are at about a third each the third one little less than that when I said net pricing we continue to have a better price realization than last year, we have some specific effects, which relates to the supply chain interruptions from Japan and which had some effect on our options which we could not totally deliver to customer demand and therefore sometimes quite simply give something more expensive with our pricing it’s because they didn’t order it so simply put and this we calculate as negative pricing effect, but really is a logistical effect in the aftermath of the earthquake and so altogether high foreign exchange rate of course is depending on the further development, if you wonder ongoing effect the others I don’t see as base effects, which would have changed our overall revenue realization versus the first quarter versus last year so I think altogether we are in a healthy development. And last that’s obviously we have to change all of the new generation, which almost idled the plant which had a major impact on our ability to fulfill demand in the compact segment we have perhaps less than 50% of realization that’s probably a fair number now looking forward we are not only coming back to 100% utilization, but we’re adding estimate of course with the significant capacity on top therefore with the over the time with one launch after the other of this new family significant better contribution from compact segment and we had in the past and this one of our drivers for strong growth as well. Stuart Pearson -: Again this is a follow-up real quickly on maybe the MFA platform that arrives with the new small car rollout can you share with any idea of the potential cost saving on that versus the current platform at all?

Again this is a follow-up real quickly on maybe the MFA platform that arrives with the new small car rollout can you share with any idea of the potential cost saving on that versus the current platform at all?

Well this new product first of all has very different performance than the old one certainly most important the fuel efficiency, which is benchmark and we leverage on the one hand the module approach. Secondly, we have to admit quite frankly that we were benefiting somewhat from the crises as far as supplier contracts there and tooling costs are concerned so that we came in below our targets as far as the costs for this new vehicle is concerned. So we have a very good competitive cost basis with this new vehicle, a vehicle, which is much more competitive independent of its cost than the former one. So we are very bullish about compact cars in the future

Okay, next in line is Horst Schneider. Horst Schneider -: Yeah, good afternoon, Horst Schneider here from HSBC I have got three questions if I may the first one relates to your inventory development and seeing that the inventories has slightly declined at Mercedes, but only 10,000 unit I would have expected a higher inventory decline so could you may update us, if we should expect higher inventory decline in the next two quarters. In that context also I would like to ask a question on China. Is it true that your locally proposed cars in China sell worse than the imports so it seems to me as if the imports to local production ratio will not be 50-50 as guided beginning of this year and at that context maybe you can elaborate again on your expansion plans for China. And the last question that I have is on vans I see here also in the second quarter an excellent development by vans maybe you could update us or provide us some outlook for H2 in terms of our next margin development. Thank you. HSBC Trinkaus & Burkhardt AG: Yeah, good afternoon, Horst Schneider here from HSBC I have got three questions if I may the first one relates to your inventory development and seeing that the inventories has slightly declined at Mercedes, but only 10,000 unit I would have expected a higher inventory decline so could you may update us, if we should expect higher inventory decline in the next two quarters. In that context also I would like to ask a question on China. Is it true that your locally proposed cars in China sell worse than the imports so it seems to me as if the imports to local production ratio will not be 50-50 as guided beginning of this year and at that context maybe you can elaborate again on your expansion plans for China. And the last question that I have is on vans I see here also in the second quarter an excellent development by vans maybe you could update us or provide us some outlook for H2 in terms of our next margin development. Thank you.

Thanks for you questions. As far as inventory of Mercedes is concerned it stand below plan. We have on the one hand and we talked about Rastatt before some pre-built inventory to bridge that production gap in Rastatt which basically you have to discount from the overall numbers. Secondly, we have a shift more and more to export markets. Germany is now less than 20%, which means the pipelines are getting longer for the same volume and then after the incremental volume which tells you that out of the total inventory relatively small portion is ready for sale and available in the different places to be sold to the dealers. And quite frankly we do not have enough inventory, we are short of inventory, which clearly relates to the fact that we have higher demand than our production could give up with and now have to see that we are coming to August where even though we tried to maintain production as far as possible of course we have a decline in production numbers. And so that we’re really hampering our sales, because of lack of inventory. Horst Schneider -: Sorry which models you have got the most the lack of inventory. HSBC Trinkaus & Burkhardt AG: Sorry which models you have got the most the lack of inventory.

Well, it’s across basically all C class models from this platforms or including GLK it’s on it’s the S class it’s the M class it’s A and B class so it would be easier to tell you where it’s not the case and then the China topic and we’re just announced in China today that we move the next step in further joining forces between the two joint venture partners by combining our sales efforts in the past we had separate sales organizations wholesale not on retail and going for CVU cars and locally produced cars dealing with one brand that was not a very satisfied situation. We have overcome that by first of August we do that together that’s a major milestone a very good one, it might be that your assumption will come true that at the end of the year we will not come up to the 50-50 percent entirely, but getting close. And so I’m very happy about their last move I was just talking about as far as date is concerned and therefore we continue to be very optimistic about China. Horst Schneider -: Will they lead to a boost in China sales that reorganization of sales. HSBC Trinkaus & Burkhardt AG: Will they lead to a boost in China sales that reorganization of sales.

Yeah it will clearly give one phase to the customer to their market altogether it will have – it will lead to one integrated marketing and branding approach, which is most important and therefore differences, which might exist today in the protection of the customer versus the two channels will definitely be reduced and ultimately limited. You had third question regarding vans. First of all I would like to agree with your testament that they are doing great and secondly we see strong demand for vans in Q3 and Q4 as well so the momentum is ongoing and we see very satisfying profitability levels for this quarter as well, whether we continue about our strategic target as we did in the second quarter remains to be seen. But in case that’s a very strong development in that division. Horst Schneider -: But I mean looking to a guidance for Mercedes and trucks it’s fair to assume multiple then that H2 even there as strong in H1 right. HSBC Trinkaus & Burkhardt AG: But I mean looking to a guidance for Mercedes and trucks it’s fair to assume multiple then that H2 even there as strong in H1 right.

I think that’s fair statement.

Okay next in line is Stephen Reitman. Stephen Reitman - Societe Generale: Yeah, it’s Stephen Reitman from Societe Generale. I’m looking at the Mercedes margin I think 10.7% is first time maybe back in double-digits at the end of 2007 I think and since you’re a little behind BMW and AUDI who obviously who got through the 10% through distant threshold in lot earlier in the last there in the last three quarters. Do you think the over 10% right is now looks quite sustainable for the rest of this year and into 2012.

Certainly everything is relative what I would call it a lot earlier that matter we were the first to come back with strong profit margins last year then the other scored up and pass us somewhat in the last two quarters that is true and the we told you already two years ago that 2011 is somewhat a challenge year because of our internal product title. We told you about the product renewals and that we expect a reduction in profits in 2011 versus 2010. Meanwhile we’re talking about their improvements in profits and probably even an improvement in the profitability for 2011 versus 2010. So I think we can be very satisfied even our internal cycle would be a 2011 in spite of these weights we’re already at this level we cannot promise that every quarter will now be at 10% and we didn’t do that we said we stay with our target for 2013 we might reach that earlier. Bodo Uebber Will now be at 10% and if we can do that, with that we stay with our target for 2013 and we might reach that earlier. Operator Okay, next in line is Arndt Ellinghorst. Arndt Ellinghorst - Credit Suisse: Yes, thanks and good afternoon everyone, Arndt Ellinghorst from Credit Suisse. The first question is for Uebber and it is on currency. An estimating $16 billion net dollar and from (inaudible) exposure for next year. So, obviously it is a significant position. And I guess so far you have told us that you have hedged 50% roughly off that number. Could you just give us directionally some color on how much your currency will be headwind for Daimler for the second half this year and also for next year. So, if we model this exposure on the spot and taking some assumptions on the hedged rates, would it be fair to assume $500 million headwind let’s say for the second half this year and potentially build, again assuming spot rates for next year, that is my first question? And then I will follow up with a second one. Thank you.

Thank you Arndt for your question. The $16 billion of exposure is quite a right assumption for 2012. We had disclosed this quarter to roughly $200 million of headwinds in the first quarter, so we will see also some headwinds in the second half compared to the first half. As we already commented this morning and for 2012, there will be at the current spot rates a headwind of roughly €400 to €500 million for total Daimler. You don’t have a second question, then Arndt; I do think that was very complete.

Okay. Then we go to the next, Philippe Houchois please. Philippe Houchois - UBS: Three questions please. One is, could you comment on the order intake and the outlook for truck demand in Brazil. The second question, could you tell us whether Smart is incurring operating losses or not. And if those losses are going up or down from where we are today? And the last question is on your investment true capacity in China. My understanding is you have chosen to build an engine capacity, an engine plant in a joint venture in China as opposed to owning it, is there a reason why you did that, is there a reason that prevented you from owning 100% of your engine facility as I think it is easily possible, thank you?

Let me start with your first question of the situation in Brazil. As you know, they have cut somehow in the first half of the year the incentives of the state for truck purchase. That was the reason that we are still very high-demand, but the momentum and thee dynamic of growth potential in the first half, it was a little bit lower. We still expect a kind of pre-buy effect, because many of heard it, but in the 1st of January next year, there is a new emission regulation Euro 5 coming and the Euro truck is of course more costly, that means the price would go up. And so, we expect in the second half of the year still the pre-buy effect. That means we will see from our expectation level at least a higher demand in the second year.

The second question, Smart. First of all, you saw the numbers that the development is very positive, 2011 versus 2010. Secondly, there is a positive state contribution from Smart to the Mercedes bottom line. As far as the engine plant in China is concerned, yes it is true that there is 50% max ownership does not apply necessarily to component plants, you typically are discussing and negotiating full packages in the development of your partnership going forward, then a plant being one piece of it. We did not have very strong intention to be the only shareholder in this plant; therefore we came out with the shareholding as you have described it, 50-50.

Okay, next question we take from Jose Asumendi. Jose Asumendi - RBS: It is three questions, Jose Asumendi, RBS. Starting off with Brazil and Euro 5. I haven’t seen yet your competitors hiking prices for the new technology. When do you plan to do that and what kind of 04:53 (Inaudible) should we expect. And also around Brazil, if the market collapses let’s say 30% next year, how flexible are you to cope with this demand drop. And second one Mexico. On the plant in Saltillo. This is obviously going to be a large boost for your profitability in North America. What proportion of trucks are you currently sourcing from Saltillo into North America at the moment? Are you still at the early stage or is this starting to hurt your profitability in the U.S? And the last one on cars. I am just looking at the seasonality in 2010 and just trying to figure out what’s going to happen in the second half. Should we expect the senior seasonality in terms of production on the car side? Should we expect higher production in the second half versus the first one or should be more or less inline. Thank You.

First of all your question almost is right this the price increase Euro-5 in the Brazilian market. We have not announced it and we plan to announce it in the second half. To give you an indication when we introduced to Euro 4, 5 solution here in Europe. The price increase was approximately € 6000 per truck. It’s only an indication, because the technology is a little bit different in Brussels. But again we plan to announce this in the second half. Your second question, in Mexico we have recognized two plants already. One is close to Mexico City and the new one is in Saltillo. At the moment we are producing 68% of the overall volume in Mexico. We started there to go into full capacity very early. So we are utilizing the capacity of the two plants by 110% and the second move will now it will come in the second half year of starting now will be the ramp up in our plants in Cleveland, Mount Holly. So overall we could generate already a cost advantage out of our Mexican plants and we are at the moment looking into third capacity increase also there. As far as cost production is concerned we plan for higher production the second half of 2011 compared to the first half.

Okay next question we take from (inaudible)

Yeah. Good afternoon. I have got a couple of questions on the trucks. First one is on order intake. I mean you increase your guidance for Europe recently, but when I look at your book to bill for Europe, it actually dropped from 1.4 times to 9.9 times. I’m just wondering if this is related to the act of change over and then also if you look at NAFTA, it’s kind of the same picture here again. Your book-to-bill drop and actually in terms of order momentum you are weaker than your peers. I am just wondering what is driving this. And the second question I would have is actually on headwinds from raw materials and content related cost. I was just wondering if you could quantify this amount and the expectation for the full-year and how much of that is actually offset by efficiency measures or pricing. And then lastly, I mean on your guidance. You are targeting 8% margin by 2013. And now you have become more optimistic on the market outlook for example in Europe and you already posed a clean margin, which is close to 8% in Q2. So my question would be when and under, which condition you would be comfortable to exceed which was an upgrade to your guidance for the trucks. Thank you.

Thanks for the question. First of all when you look to the order intake, as I said very often you should not only look into months in a quarter. Look at the half year. Second I think on the site that you announced here from investor relations, you have to add to Europe, always Eastern Europe and then compare with the rest, because Europe is both and there we have a very good order intake and also very good book-to-bill. Its 130% and it underlines what we said before that we expect the deliveries will be higher in certain first quarter. Overall in NAFTA we had a very-very strong first quarter. Always we said this cannot be going through the year, because these big fleets are ordering you can look into one quarter and the other the level is still very satisfying and we have a book-to-bill in NAFTA over the half year 144%. So again there is the production ramp up coming up and we will see some more deliveries as well there. The material issue. We had some headwind just overall no doubt. Firstly we can also look into NAFTA for example. We have the contracts we are looking in with all customers. They hit some accelerate some momentum into that we can hand it over; accelerate that we can hand over this raw material price increases also to our customers off cost is a time like, but basically the efficiency and this kind of potential will minimize the headwinds still there will be headwind, but with such mechanism we can limit it somehow. And now the 8% question you know, if we say 8% that is for that’s not absolute figure, it’s a relative figure because it depends always on the market development. If all the markets would be on a normal level then the minimum is 8%, if the markets are going up like let’s say 2013 they are better and before the pre-crisis level I’d say this way or exactly pre-crisis level it will be 2% to 3% higher. If it’s going back to a level that’s another normal year it could be lower. So this is on average over the cycle and not a absolute figure.

Okay maybe I can just also follow-up a question on this so, I mean right now if you look at how the market is developing I mean, which would be comfortable in saying that maybe you will already achieve an 8% margin or even exceed it next year?

Like I said it’s the last Road Show already, I would not say there is no possibility that we can achieve it earlier.

Thank you, next in line we have Fraser Hill Fraser Hill - Bank of America: Hi, good afternoon I’m Fraser Hill from Bank of America. Just three questions. Firstly China, you see your sales over the last three to four months now broadly flatting at around about 17,000 units a month. Is there anything that’s worrying you about that sort of flat progressions, do you see that’s just normal seasonality and do you still expect to pick up in the second half of the year if you do, is there any basis for that as far as you said today falling on from that on China looking at pricing and products you’ve now talked about producing the GO locally, are there any other sort of higher price models that maybe brought under local production in China over the next year or two that you are perhaps further thinking about for modeling over and again, while we are talking about China any sign of price competition or yeah any competition sort of picking up across the product categories. So, a few issues on China the next issue for me on the cash flow provisions in the quarter if you look at the cash flow about $610 million taken. Can you confirm that those are consumption of provisions as opposed to provision relief benefiting the P&L?

China, when you take that mentioned 17000 monthly rate there and you multiply that by 12 you already exceeding our forecast we were giving for this year, so in depend of the question how strong last year’s quarter were and the second quarter therefore instance was a very strong quarter, the development within this year is according to our plan and we say confident that we will see further significant growth in China and 2011 obviously is one-year where we will not have there almost three digit growth as we saw for a number of years and can’t have that quite obviously, but we see it near past towards the expected at least 300,000 units in 2015 and it’s more likely that we will exceed this number then we would fall short. And GLK rightfully set its the vehicle which will be localized next and as we set MFA which means compact new generation compact car vehicles will be the next to be localized, currently we have no plans for higher priced vehicles except for the E-Class, which is already in production as you know it will be localized in China. Price competition China is a competitive place and even in times when the growth rates were 60%, 80% for many of the competitors in the previous segment there still was a competitive environment and some price pressure. So I don’t see anything unusual there. Yes, of course we see some slow down of the growth in China and economy altogether there and in the automotive market as well, but the least of all in the premium automotive markets and once again therefore we stay very confident. Cash flow.

To your cash flow question, of course we had utilizations of provisions for personal and social costs, which is related to the payment of the profit sharing bonus of 2010 to our employees, that means, we utilized the provision and we have the payout means. The cash flow is impacted so to say negatively. The P&L of course is not impacted because we are only utilizing it. The P&L impact was in 2010.

Okay. Next question we take from Frank Biller. Frank Biller - LBBW: Yes. Good afternoon. It’s Frank Biller from LBBW. Maybe you can give us some sort of an update in the raw material burdens you had in the second quarter and what do you expect for the second half and the year 2012 forward?

Frank, we have updated I think also in the first quarter, the market about the raw material impact, which was about around $850 million for Daimler in total and this relates to steel, aluminum, and other stuff and it has not changed over the last 3 months. Frank Biller - LBBW: And so, for the second half you expect this amount too then, yeah?

That was the number for the year; you can split it in half. I do think that we tend to be a bit more in the second half than in the first half.

Okay. Next question we take from Charles Winston. Charles Winston - Redburn Partners: Hi. Good afternoon. Charles Winston from Redburn Partners. Just a couple of quick questions. I seem to remember when you changed your accounting policy, the leased asset disposals and started inflating the revenue in financial services. The profit or loss from those disposals appears in the Mercedes result. I think I’m right in saying that. I was just wondering if you could update us if there is any sort of significant profit or loss in the Mercedes result in this quarter, because obviously residual value still has been very, very strong. And just a second question, really just relating to Stuart’s question earlier on. The FX impact on revenues, obviously to get an underlying idea as to sort of price mix. It would be useful if you could perhaps just give us an idea as to what the FX impact on revenues was in the quarter particularly for Mercedes and Trucks? That would be kind. Thank you.

To your first question of the residual values and the impact on the used car business, of course it is booked within the industry part and not in financial services, but with this element up in the second quarter there was nearly no impact, so not negatively and positively, so minor impact in the second quarter. Your second question, the currency effect on revenues on the Daimler side, I do think we disclosed the increase of revenues was 5%, excluding exchange rate effects, we had an impact of 9%. Of course, the total impact of the currency effect this maybe related to Mercedes Benz cars.

Okay. Next question from David Arnold. Arndt Ellinghorst - Credit Suisse: Hi. It’s actually Arndt Ellinghorst here again from Credit Suisse, thanks. I was dropping off my phone earlier on. Dr. Zetsche, you have or Daimler in general has received some fairly critical investor feedback most recently and I don’t want to be impolite asking this, I rather want to give you a chance to just share with us what your thoughts are? How much of that was new and does this trigger something within Daimler or how do you deal with this feedback you are getting from the financial community?

Well, we generally try to listen to the market and to the investors, sell-side, buy-side and we try to take comments serious and learn from them, that is generally true and that is true in this specific case and I think that’s all what can be said. Arndt Ellinghorst - Credit Suisse: And I guess investors would love to see better performance of your stock and I’m pretty sure the answer to that is a better fundamental performance, right? And you have mentioned many times that Daimler is highly committed to close the performance gap and margin gap to its relevant peers, what’s your thought process there? Is this just a rolling target or do you have a timeframe in mind by when you can really be on top of your peers?

But first of all, we have defined strategic profitability targets for all divisions to be accomplished in 2013, we have just finished the quarter where a number of the divisions were already ahead of time exceeding these targets and others coming hopefully close. There of course, the word is relative gain and that’s why of course, we have to watch our competition as well. We have to do that, look at that at every quarter, but not get crazy about every quarter, but look at the trends mid-term trends and there we are clearly very confident that we will come to these leadership positions, benchmark positions we are striving for. Of course, profitability is one element; growth is the other element, which is at least as important. We are aware of that as well and we are setting our plans as well too, on the one hand achieve and if possible, pass our own growth sockets, which is the case within this year, but there again, it’s a relative gain, so objective has allowed us to grow faster than our competition and where we are not in this position today, we are setting the foundations to get there. Product is key in this regard, we are convinced that we have a very strong product pipeline in all divisions and therefore, we are very confident in accomplishing our targets.

Okay, next in line is Ranjit Unnithan. Ranjit Unnithan - JPMorgan: Hi there, Ranjit Unnithan from JPMorgan. Just a quick question I just wanted to clarify an answer from earlier. So, in the second quarter, the Mercedes revenue per unit declined quite meaningfully from the first quarter and yet margins expanded quite nicely. So, could you just explain why that should be, I think you were trying to answer something about your option mix being different from what is normal, but I would have thought that hurt you rather than benefited you on margins. And in general, your sequential contribution margin or your operating leverage was quite strong at about 35 odd percent, which is at this point in the cycle, when you are talking about very high level of the utilization, a bit surprising. So, if you could just help me understand why margins were this strong relative to a low revenue per unit, that would be helpful, thanks?

Well first of all, we have seen a strong quarter as far as volume was concerned, which definitely helps the margins. And secondly, we are seeing overall as I mentioned before further improvements in our pricing capability, I have talked about some exceptions for some logistical reasons, but directionally we continue to reduce our discounts around the globe. The revenue decline per unit as we said before, to some extent is related to exchange rates, translations, which obviously do not affect our margins directly then but this is a very minor affect at that point of time where we having change from CBU units to locally built units in China. You have a positive impact on your return on sales, that is very true for Audi and Volkswagen, BMW as well to a higher extent than for us, because they have much higher local volumes, but this is one element, which does not have the substantial impact on Q2. So, these are perhaps few elements of this picture. On the other hand of course, the bottom line is always the top line plus the cost side and we always said that it’s very important to stay disciplined on the cost side in the good times. Basically, he is spoiling the picture in the good times, not in the bad times and that’s what we try to avoid and we are pretty successful in this regard as well, which obviously helps the margins.

Okay, I have two more questions. One is Michael Kindle from Barclays. Michael Kindle – Barclays Capital: Yeah, it is Michael Kindle from Barclays Capital, thanks for taking my question. My question really is around trucks, I am trying to understand the outlook for trucks, you mentioned EBIT in the second half it’s going to be better than the first half. Am’ I right in thinking you’ve got about 300 million from your 60 come through and then I guess you’ve also got the increase in staff numbers as far as in North America and Brazil. So just wondering what impact that will have are we talking about a rise in EBIT but not in margins in a second half, and also I guess as it’s more of a longer term question, when I look at the operating leverage trucks has the lowest operating leverages of all your businesses I’m just wondering where are you in terms of capacity wise that lower I would have thought that you actually had more excess capacity in trucks than you were in cars and the effort should actually be higher as volumes come up that’s my few questions. Thanks.

So first of all, if we are hiring staff now in the United States or Brazil, that it’s very dear to follow the production ramp up, because there is a volume there, that we expect to sell and this has now impact on – negative impact on margin it will but of course, because the volume is increasing. Yeah when it comes to Euro VI and then Actross indeed that’s true that will have some effect in the majority in the second half of this year basically we are there the first one was introduced a Euro VI with totally brand new truck the new Actross we are head gear of autos and if you are looking to some of the competitors they are expecting now increased spending in R&D and all those to be prepared for Euro VI so we have done this already and we see there a good chance for market success, because you know nothing is more important than fuel efficiency and we see new Actross we have some good potential to gain this. The second thing is we have of course markets that are growing up in United States for example 30 to 35%, utilizing already 100% of the capacity now, because we expect another growth in the market next year. So this is one of the things to try to answer your first question with you’re the second question, but we have the capacity and now we’re going up Mexico we’re utilizing it only on a percent in the first half year for example the two plants for this two and half plants we have in United States we utilize going to be 50% and now the production ramp up is going up and you will see the effect also there.

The last (inaudible).

Yes, good afternoon (inaudible). Just a quick question regarding what you said about the Chinese contribution. Could you concerned me that you’re not booking the revenues from the locally produced cars in the other auto divisions, but you’re just booking the EBIT margins that’s right?

It is almost right. We booked the revenues of the parts we send to base these locally produced vehicles, but we are not booking the incremental value being build in China and that is the same approach as our competitors take just our percentage of locally produced products in China is lower than the one of our great competitors.

TVs,:

I’m going to say that’s clear accounting rules we have production joint venture of 50-50 and that is at equity consolidated means the proportion of net income effect.

Yes but this is booked at the division level that is exact below.

Exactly it’s booked at the respective division level.

And exactly the same as our competitors do.

Okay Gerry(ph). Thank you, ladies and gentlemen, thanks for your questions for being with us today. Investor Relations remains duty bound to answer any further questions you may have. I hope to talk to you again June. Thanks and good bye.

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