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Daimler says low ECB rates may force more pension payments
February 5, 2015 / 12:12 PM / 3 years ago

Daimler says low ECB rates may force more pension payments

FRANKFURT, Feb 5 (Reuters) - German carmaker Daimler said on Thursday the low interest rate environment may force it to invest more in its German pension plan, after it made a 2.5 billion euros ($2.9 billion) payment in the fourth quarter to cover a funding shortfall.

Daimler said it wanted to ensure its German pensions were adequately funded, aiming at funding to cover around two thirds of the outstanding German pension obligations.

The policy of maintaining low interest rates in Europe is making it harder for companies to earn a return from assets they have invested as part of their pension plans, forcing them to make extra payments to cover potential shortfalls.

“We will continue to look at the interest rate environment. I cannot rule out that we will make a further contribution to the pension plan, although there is no decision regarding this matter at the moment,” Daimler Chief Financial Officer Bodo Uebber said.

$1 = 0.8743 euros Reporting by Edward Taylor; Editing by Mark Potter

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