Daimler Taps the Chinese Panda Bond Market

Abstract

Preparing for a potential interview, an MBA graduate reads extensively about Daimler AG. She learns about company's longtime presence in China manufacturing luxury automobiles and its continued investment in manufacturing and R&D capacity in that country. She also learns that the company financed part of its operations and growth in China by issuing bonds in both China and Hong Kong and wonders whether the company would return to those bond markets. Excerpt UVA-C-2417 May 9, 2019 Daimler Taps the Chinese Panda Bond Market It was spring 2019, and Michelle Preston eagerly anticipated the possibility of interviewing for a position in the office of the CFO at Daimler AG (Daimler). She had invested much time and energy getting her master's of business administration (MBA) from a top European business school and wanted to work where she could combine her love of fine cars with her newly acquired business skills. Riding in a Fine Car Preston fondly recalled the many times she had sat in the back seat of her grandfather's Mercedes-Benz sedan as a child. That car offered such a comfortable and smooth ride that Preston always slept soundly during the eight-hour drive from her hometown to her grandparents' farm. Her grandfather owned an S-Class sedan and had driven nothing else since the model was introduced in the 1970s. Ever since, Preston had dreamed of owning a Mercedes-Benz S-Class coupe. The coupe was a sportier version than the S-Class sedan, and Preston felt it would better suit her own needs. Its twin turbo V8 engine brought so much power that Preston was certain the car could go from 0 to 60 in less than five seconds. The car handled like no other she had ever driven, and the interior was nothing but comfort and class. Still Preston was nowhere near being able to afford the sticker price, which started at €110,000. The closest she had been able to get was in her role as a sales representative at a large Mercedes-Benz dealership, a job she took after graduating with her undergraduate degree. After two years in that job, Preston had started graduate school to study for her MBA. . . .