21 ms·

Mercedes-Benz workforce to receive record profit-sharing bonus

397 points by ofcrpls 4y ago

gnrlst 4y ago
Not that Mercedes is a good example, but is there a name for company philosophy of being employee/team-centric versus investor centric? E.g. all profits shared among employees instead of shareholders for example. I'd like to work for a company like that.
- justin66 4y ago
  In the US, ESOPs, worker cooperatives, and consumer cooperatives (like REI) are options.
- RcouF1uZ4gsC 4y ago
  I think that is called a cooperative.
  - deleted 4y ago
    [deleted]
  - parski 4y ago
    Yeah, check out Mondragon. https://en.wikipedia.org/wiki/Mondragon_Corporation https://en.wikipedia.org/wiki/Mondragon_Corporation
- rhamzeh 4y ago
  That's generally what a coop is right? (And I guess family owned businesses where all the workers are members of the same family?)
- CharlesW 4y ago
  It seems like being employee-owned might be a prerequisite for that, but I'd love to see examples that persuade me otherwise. There are tech co-ops, which are worker-owned: https://tech-coops.xyz/ https://tech-coops.xyz/
- yabones 4y ago
  "co-op" or "co-operative" is what I see them being called in Canada. A few small "craft" industry in my town is structured like that, where every employee is an owner with a stake based on their position, tenure, etc, and all profits are distributed back out each quarter/year. They're also common in agriculture, where a feed mill will be owned by all the farmers that use its services and/or store their grain there. https://en.wikipedia.org/wiki/Cooperative https://en.wikipedia.org/wiki/Cooperative
- NickC25 4y ago
  Crazy thing is that moves like this also benefit shareholders, albeit indirectly. A company that employees want to work for because they know they'll benefit first means that more and more of the top job seekers will try to work there, which means (indirectly) that the company will have the best of the best employees. As an investor, I would think that in the long term, that's the best use of the company's money and the best path to long-term growth. I don't want a quarterly, biannual, or annual dividend if that means that that excess capital will be re-invested into better employees (or keeping current top employees) who produce better products which can better position the company in the long run. For a long time I naively thought that was the whole point of investment: long term sustainability and allocation of capital that allowed companies to best compete.
  - rcme 4y ago
    What you say is true: investing in employees attracts top talent. However, that's only one side of the equation. The other side of the equation is that such policies cost money. So in order to say that this policy is a "benefit to shareholders", you'd need to demonstrate that the benefits outweigh the cost, which is of course impossible to quantify. Over the last 5 years, stock in Mercedes Benz Group is down almost 25%, so I wouldn't say that, generally, Mercedes has been good to shareholders.
    - linster 4y ago
      Down 25%? Mercedes Benz Group AG https://g.co/kgs/Qm7LK4 https://g.co/kgs/Qm7LK4
      - rcme 4y ago
        Oh sorry I was looking at the U.S. listed ADR, which is affected by currency fluctuation.
    - edmundsauto 4y ago
      Is that the best way to evaluate it? It looks like they also offered about $3-4 dividend each year. The stock is down $5 over the last 5 years, but has also produced almost $15 worth of dividends[0]. For comparison, Ford might be up by about 25% (+$2-3) last 5 years, but it has only yielded a dividend of around $3. [0] https://group.mercedes-benz.com/investors/share/dividend/ https://group.mercedes-benz.com/investors/share/dividend/
- hcal 4y ago
  They exist in several forms. In the US I think the best kind are called employee-ownership-trusts or worker-owned cooperatives.
- culi 4y ago
  Employee-owned? A co-op? B-corp assessment also includes worker satisfaction and ownership as part of its assessment: https://www.bcorporation.net/en-us/best-for-the-world-2022-workers https://www.bcorporation.net/en-us/best-for-the-world-2022-w...
- londons_explore 4y ago
  There are corporate structures where all shareholders are employees and vice versa. "cooperatives". They tend not to be a great structure for fostering a massive growth, massive risk, massive profits type company.
- dan1234 4y ago
  In the UK, there's John Lewis[0], a company that is owned by a trust on behalf of its workers (who are known as partners, not employees). [0]https://en.wikipedia.org/wiki/John_Lewis_Partnership https://en.wikipedia.org/wiki/John_Lewis_Partnership
  - aryehof 4y ago
    Learning this makes me more inclined to shop there!
- lm28469 4y ago
  Are you some kind of communist ? /s
- nickbauman 4y ago
  The most radical are Co-Ops. The workers own the company. They're called Worker-Owners. Where management is a skill, not a rank. The problem with this model is three-fold: • Outside investment can undermine the Co-Op's autonomy (many don't allow it) • Raising capital is hard; usually you're bootstrapping (worker-owners must divert some of their income) • Sometimes worker-owners get caught up in the democratic process of collective decision-making and get frustrated On the other hand: • A real Co-Op is real community. They exist to support the humans through work. You're all in this together. You can be "kicked out" by vote, but when you do, you give up your share and all that share money accumulating is yours. • You are "The Man" in the worst and best way you can imagine If something is wrong with the company, you can change it. • No more perverse mgmt incentives. The biggest Co-Op is the Mondragon. They are very successful, too. https://en.wikipedia.org/wiki/Mondragon_Corporation https://en.wikipedia.org/wiki/Mondragon_Corporation
- mempko 4y ago
  Welcome to socialism. This is what actual socialists want. Everyone to have ownership in the company and participate in it's success. Where the decisions are made democratically by workers. In the modern world, you will see this in co-ops today.
bradhe 4y ago
[flagged]
- jmknoll 4y ago
  In case you’re new to HN, here are the guidelines we follow around posting & commenting. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html Please try to avoid snarky or dismissive comments, and ensure that what you’re writing makes a point and contributes to the conversation.
  - pc86 4y ago
    It's pretty easy to see when a profile was created. Theirs was created 5-6 years before yours. Sometimes comments like this get the point across in ways some self-aggrandizing $WALLOFTEXT can't. €7,300 is chump change.
    - eddsh1994 4y ago
      In Europe that's a good bonus in a place the average income is around 35k...
    - gambiting 4y ago
      I work in tech and the biggest bonuses I ever received were about £5-6k(pre tax too). That's pretty good money to be given as a bonus.
    - alistairSH 4y ago
      €7,300 is chump change Spoken like a true tech bro. In most suburban areas of the US, that's ~3-4 months rent. Or more than a year of car payments. Or a year and a half of groceries for an average American family. "Chump change" LOL.
    - whatatita 4y ago
      Nah, 7'300 is a good bonus. I've never heard of a five-figure bonus outside of FAANG or long-standing senior positions in old companies such as law firm or banking.
digdugdirk 4y ago
"The company's management and General Works Council have jointly agreed to pay all eligible employees a special lump sum bonus of up to 7,300 euros, a figure that is even higher than the current maximum payment cap of 6,465 euros." This General Works Council seems to be something like a separate "union within the company", in addition to whatever union represents various workers within the organization. On top of that, Mercedes Benz has a corporate Supervisory Board with 1/2 of the members representing the employees. Interesting how this structure has a headline like this one, vs the ">10k workers laid off from giant corporation with record profits for the past two years" headlines that seem to be popping up here daily.
- amalgamated_inc 4y ago
  Having a supervisory board w/ 1/2 of members representing (non-management) employees is mandatory by law for any corporation over 50 (?) employees in Germany. The "General Works Council" is just that board, I believe. So this is quite a normal setup for a large German company.
  - arez 4y ago
    It never mandatory to have a Betriebsrat in Germany even with 100k employees you could not have one. You can however start one already with 5 full-time employees. Companies tend to have one around 50+ employees because before that it rarely makes sense
    - amalgamated_inc 4y ago
      So it's not mandatory if somehow all employees decided not to form one, but if any of them wanted to, it's mandatory to let them and presumably support them/listen to them in some way?
      - wirrbel 4y ago
        Basically it’s not mandatory in the sense that you will not be fined as a company if you do not have one. However, employees can make a motion to elect a Betriebsrat (works council) in a given location. Then, if 3 locations have a local Betriebsrat the Gesamtbetriebsrat can be formed which is regularly elected across the whole German staff. Grocery chains like Lidl and Aldi have prevented the formation of a Betriebsrat by employing union busting style measures (intimidating or firing staff, etc). Iirc teslas giga fab does not have an elected Betriebsrat. Since many American companies incorporate in Germany for their German branches, they can also face Betriebsrats elections. Overall I do think a Betriebsrat is a net positive for a company. It’s not always as profit oriented as an executive but it has a long term interest in the company as opposed to executives who just think in quarter years and about keeping shareholders happy.
bluedino 4y ago
Very common in automotive companies during the good times. Heck they can even get bonuses when the union starts a new contract with the automaker.
delecti 4y ago
Seems this story only applies in Germany, but their US tech workers also get a bonus at the same time that is partially based on company performance. My bonus last year was very nice because they've been doing so well (in the ballpark of $50k as a senior dev), and it looks like it'll be similarly nice this year too.
- andsoitis 4y ago
  How does your salary compare to tech companies? I know levels.fyi isn’t very accurate, but it’s all I’ve got and it doesn’t look that stunning. On the other hand, maybe the culture, meaningful work, etc. is better so lower pay is fine: https://www.levels.fyi/companies/mercedes-benz/salaries https://www.levels.fyi/companies/mercedes-benz/salaries
  - Der_Einzige 4y ago
    Levels.fyi is highly accurate actually.
  - delecti 4y ago
    Salary is quite a bit higher than this shows (the "software engineer" salaries listed here are for Germany, not the US), but there are no stock options, so total comp is probably lower than FAANG. I started as a "engineer" (P2, between junior and senior) at 135k 5 years ago, and each level has come with a ~20k raise, plus annual raises in between. The bonus percent gets bigger too: as a P1-2, your bonus target is 10% of salary, at P3 it's 12%, and P4 is 14%. That's further modified by personal performance and company performance (0-1.5x for personal, and 0-2x for company; last year I was at 1.44x and 2x respectively, for a bonus of ~35% of my salary). They're also not stingy with promotions, I've been promoted twice in under 5 years, and my base salary is currently ~180k. I worked at Amazon for 5 years before here, and have been here for another 5. The job is less stressful, the work is more meaningful (to me anyway, in that cars are more interesting than web ads were), the culture is more fun, and things are less cutthroat. I probably don't quite make FAANG money, but I don't put up with FAANG BS either. And yes we're hiring https://jobs.lever.co/MBRDNA https://jobs.lever.co/MBRDNA
- 4y ago
josefresco 4y ago
Bonuses are cheaper than pay increases.
- KMag 4y ago
  They're also better for stability in numbers of employees, as it's easier to reduce expenses in bad years without having to go through layoffs.
  - vlowrian 4y ago
    True. On the other hand, if the increase in revenue is at least partially caused by inflation and it's not to be expected that deflation will revert this effect any time soon, new hires might expect significantly higher wages then what is currently paid within the company. If the current workforce is keeping their pre-inflation wages and new hires are receiving higher wages, this causes an increase in turn-over rate which is exactly what can be seen in Germany throughout the last two years. Admittedly, there might be other, additional causes to this. It should still be considered if higher turn over is a business risk for the company.
    - KMag 4y ago
      I think most companies and industries where bonuses make up a significant portion of total compensation still usually have annual inflation adjustments to base salaries, largely to avoid this problem. In an ideal world, people would be a bit better about managing uncertainty and most people would be able to live comfortably within their means on their base salaries and would have the restraint to invest large percentages of their bonuses.
      - vlowrian 4y ago
        Fair, but then it's not a question of either one or the other. Im not arguing against bonuses. It just shouldn't be the only outcome of what's expected to be a permanent increase in revenue.
kristaps 4y ago
Meanwhile at Tesla ..
- bryanlarsen 4y ago
  Meanwhile at Tesla employees have become millionaires off of stock options. Crappy place to work for other reasons, but pretty much everybody gets RSU's.
  - recursive_ 4y ago
    There's a big difference between stock options and RSUs. Nobody became millionaires off RSUs unless they started at Tesla <2018. I'm not convinced everyone at Tesla is offered options.
    - bryanlarsen 4y ago
      Take this as the heresay as it is, but pretty much everybody at Tesla gets at least $20K in RSU's. If you got that pre-IPO and kept it this long it's worth more than a million. But even if it doesn't appreciate at all, over 4 years that's a similar payout to the MB payout referenced in the article.
      - kgwgk 4y ago
        > If you got that pre-IPO Do you realize that Tesla has gone from 1k to 100k employees in the meantime?
  - deleted 4y ago
    [deleted]
  - PuppyTailWags 4y ago
    The people working in the tesla factories, the line workers, are millionares? Get RSUs?
- rcMgD2BwE72F 4y ago
  employees are working on cars that are competitive, whose price are becoming more affordable and that fit people's expectation (cheap to maintain, highly efficient, compatible with a sustainable future)? I'd prefer to work at a company that will hire en masse in the coming years, than at one that's rich on paper but prefer to pay dividends and one-time bonus while having no reasonable roadmap for the future of mobility. I hear the Qataris and Saudis are paying well, too.
andsoitis 4y ago
Doesn’t Mercedes-Benz pay very very poor salaries?
- aiqq 4y ago
  Considering how small these “record” bonuses are they probably do pay a very very poor salary.
  - wirrbel 4y ago
    The base salary is solid and high. It’s a salary and not a lottery.
vlowrian 4y ago
I work for a small-mid sized German software engineering company (~200 employees). Last year the company raised all wages by 7,500.- EUR (additionally to the usual raises). This was not a one-time payment, but a permanent increase in pay and it was the same absolute amount for all employees (including office management and other non-engineering departments). The reasoning behind this decision was that the inflation was hitting employees with lower income harder than employees with higher income positions. Whenever I'm seeing posts like this, I wonder if "up to x Euros" isn't the other way around and smaller incomes are on the lower end of the bonus range. Link (content written by our PR department, in German): https://www.presseportal.de/pm/164280/5271230 https://www.presseportal.de/pm/164280/5271230
- judge2020 4y ago
  > The reasoning behind this decision was that the inflation was hitting employees with lower income harder than employees with higher income positions. Isn't part of inflation that this doesn't work at scale? As in, if everyone gets higher wages, bigger bonuses, and more money is being poured into 401ks, inflation gets even worse? Or do wages become a rounding error when you add in stuff like real-estate and loans?
  - vlowrian 4y ago
    Sure. But this is more of an argument against raising all wages relative to inflation. Inflation (at least in Germany) raised mostly prices for everyday goods - like food, fuel and rent. Raising the wages by an absolute amount meant helping those whose expenses are mostly basic goods, not trying to match inflation with pay raise.
  - Closi 4y ago
    > Isn't part of inflation that this doesn't work at scale? As in, if everyone gets higher wages, bigger bonuses, and more money is being poured into 401ks, inflation gets even worse? Or do wages become a rounding error when you add in stuff like real-estate and loans? Kind of, but wages are only part of the cost of goods. Assuming wages represent 30% of the cost of goods (i.e. 30% labour, 20% property/fixed costs, 50% materials) and wages go up 10%, then they only impact the cost of goods by 3% (thus 3% inflation might be expected at a simplistic macro level). Then there is a sort of loop where the 3% inflation could encourage another 3% wage inflation, but that only affects the cost of goods by 0.9% and so on. When you follow this theory, that 10% wage inflation only turns into an additional c4.5% increase in inflation (or 15% if you include the initial 10%). This is overly simplistic and there are other levers at play, which is why lots of economics calculations often have continous simulations which can show the impact of these feedback loops (Inflation causes wage increases causes inflation causes wage increases).
froggertoaster 4y ago
Very nice. Still not buying their cars until they get their long-term reliability and depreciation issues worked out.
- aiqq 4y ago
  Dont worry bmw and audi are in the same boat i dont understand why people think these are good cars.
  - michaelcampbell 4y ago
    Because historically they have been, comparatively to other brands. They're getting to be far too complex to be reliable, and too much attention is paid to short term profits (IMO), so we get what we have now.
    - aiqq 4y ago
      Historically they have been but most innovation at least from bmw comes from slapping extra turbos to chase ever increasing bhp. Interiors are mainly the same but with updated instrument clusters and redesigned exteriors. Not groundbreaking i think what is happening is too much attention to short term profits and forcing customers to refresh their cars every few years. Literally after they out of warranty bmws fall apart not to mention mercedeses that fall apparent even within warranty (the m and s class do).
    - jandrese 4y ago
      BMW has never had great longevity. They're mostly fine for 100k miles, but people expect cars to last much longer than that now. Old BMWs have solid reputation as a money pit.
- orangepurple 4y ago
  Those are precisely the sources of revenue that allow bonuses to be paid out to workers.
  - 4y ago
PragmaticPulp 4y ago
The optics on this one have been fascinating to watch on social media. I've seen a lot of people in my own network who work at U.S. tech companies share this as an example of what companies should be doing. A lot of contrasting takes about how U.S. companies are laying people off while MB is handing out higher than expected bonuses. Meanwhile, I know for a fact that a lot of the people sharing this are getting paid significantly more than these employees and also have bonus plans that pay out several multiples higher than the highest MB payout (7300EUR) even in a bad year. Maybe this is an example of managing expectations. Mercedes-Benz paying four-figure bonuses to employees is noteworthy largely because they're paying more than expected. Meanwhile, I see people who earn significantly more being unhappy because their compensation was less than some number they expected. Interesting lesson in how expectations are relative, not absolute.
- dahfizz 4y ago
  > Interesting lesson in how expectations are relative, not absolute. Yup. I have a hard time taking any of the whining on HN seriously. People being paid $300K+ but all they can do is complain that they attend too many meetings. People that job hop once a year but the idea of layoffs is high treason.
  - erulabs 4y ago
    I’ve been chastised before for suggesting “there is no humanitarian crisis” when engineers (like myself) are laid off. A strange “I deserve to be employed like this” vein, which is natural, but wrong.
  - lm28469 4y ago
    > whining on HN seriously > People being paid $300K+ It's probably very far from the average HNer
    - donkeyd 4y ago
      Agreed. I'm not even nearing 1/3 of that. It is, however, a fact that a relatively high amount of HNers earn way over 100k due to the prevalence of people form SV on here. Tech salaries in the rest of the world are nowhere near those in SV.
squokko 4y ago
Car companies are in for a rough 2023 so if Mercedes loses money will they deduct from their salary?
- sschueller 4y ago
  Do car companies claw back dividend payments?
- pjc50 4y ago
  No? Why would they do that? This is a 2022 bonus. Lack of profit might mean a smaller or no bonus at the end of 2023, though.
stuaxo 4y ago
Lets see if the thing where big companies applies here, (it won't).
timdaub 4y ago
Coming from Stuttgart, Germany, it is well-known that if you get any position within the local automotive industry, it counts as making it. Doesn‘t matter what level, even if you work on the assembly line. So I interpret this post as follows: HN discovers that building German cars is a very good business.
- akullpp 4y ago
  True, my uncle stayed his entire life and now got an insane amount for early retirement. Myself on the other side worked 2 years as a software engineer and that's as much as I could taake: * politics * too many artificial restrictions * worst management I've ever experienced * Work doesn't get valued at all, cancelling so many projects and ideas amounting to nothing * lower reputation than "real" engineers, they still don't understand the value of software, like so many German companies, and treat us as necessary evil, which is also resulting in not competive salary If you shut up and just come to work every day, you certainly "made it", but for me that's impossible.
- ChuckNorris89 4y ago
  >HN discovers that building German cars is a very good business. I'd rather we all cycle everywhere like the Dutch and need less cars.
  - ivan_gammel 4y ago
    Even with bikes there's still a lot of use cases for cars. With EVs, autonomous driving and current trends in urban mobility chances are high that automotive companies will become fleet management companies in 20-30 years (Uber has no chance to survive in the long term).
lvl102 4y ago
Record profits everywhere while inflation raged on. Only one explanation then for inflation: PRICE GOUGING. Corporate greed during global pandemic. Capitalism at its finest. Now we all have to pay the price just like on 2009. Privatize profits. Socialize losses.
umeshunni 4y ago
Something missing from this conversation is that Mercedes is one of the few 'legacy' carmakers that are managing the transition to EVs and automated driving well. They have flagship EVs - EQE, EQB, EQS that are well reviewed. They are the first car company to get approved for L3 self-driving in the US: https://insideevs.com/news/630075/mercedes-first-to-offer-level-3-self-driving-in-the-us/ https://insideevs.com/news/630075/mercedes-first-to-offer-le... and they are building out their own network of charging stations: https://insideevs.com/news/629594/mercedes-ev-charging-network/ https://insideevs.com/news/629594/mercedes-ev-charging-netwo...
- ericd 4y ago
  They have some, but are they producing them in significant volume? Most car makers have some models, but seem to be having trouble scaling them up.
  - r00fus 4y ago
    Given their pricing (high end) they are definitely available in my area. It's not like Hyundai a few years ago where you couldn't find their EVs anywhere outside of southern CA. Just looked even Hyundai/Kia are available near me as well.
- rcMgD2BwE72F 4y ago
  Do they manufacture and sell these cars? I see ads and read editorials but I can't find these cars on the road. I'm afraid they use this EVQ-T-B-D-R to impress, then get people to contact their dealers who dissuade them to go EV just yet, and finally sell the biggest ICE or hybrid possible. That's what happened with my dad who went to Lexus (for a heavy plugin hybrid, sigh).
  - spery 4y ago
    I see them quite a lot in Berlin.
jedberg 4y ago
This is what happens when your country has laws requiring workers to sit on the board. Aka strong unions by law.
tracker1 4y ago
It's funny in that the structure is inherently what Economic Fascism is, separating the economics from the nationalism/racism typically associated (from Nazi Germany). The economic bits seem to hold over though. Nothing is really stopping similar organization from happening in the formation of Corporation in the US and elsewhere. But it has to be part of the foundation of said company, especially if it's publicly traded, as it's very hard to do after the fact. I'm not convinced it should be restructured via force from the Government, and not even as a bailout, as I'm not a fan of those govt actions either.
xyst 4y ago
Just a sliver of the profits given to the plebs to appease the masses, media
kerpotgh 4y ago
Is this supposed to be a lot? I used to get 50% bonuses on my base (which was already high) when I worked on Wall St.
dang 4y ago
Is there a good third-party URL for some independent reporting about this? A corporate press release is not usually a good source for this kind of thing. This is a bit of an exception to HN's "original source" guideline. https://hn.algolia.com/?dateRange=all&page=0&prefix=false&query=press%20release%20by%3Adang&sort=byDate&type=comment https://hn.algolia.com/?dateRange=all&page=0&prefix=false&qu... https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
lakomen 4y ago
Destroying the world with vehicles makes a lot of money. This company fuels the whole region ( suppliers etc ) where I live. Workers there are paid more than average, however compared to US salaries that's not much. So it's always perspective.
readonthegoapp 4y ago
what was this incredible strategy that was implemented? sounds fishy.

397 points by ofcrpls 4y ago

Not that Mercedes is a good example, but is there a name for company philosophy of being employee/team-centric versus investor centric? E.g. all profits shared among employees instead of shareholders for example. I'd like to work for a company like that.

justin66 4y ago
In the US, ESOPs, worker cooperatives, and consumer cooperatives (like REI) are options.
RcouF1uZ4gsC 4y ago
I think that is called a cooperative.
- deleted 4y ago
  [deleted]
- parski 4y ago
  Yeah, check out Mondragon. https://en.wikipedia.org/wiki/Mondragon_Corporation https://en.wikipedia.org/wiki/Mondragon_Corporation
rhamzeh 4y ago
That's generally what a coop is right? (And I guess family owned businesses where all the workers are members of the same family?)
CharlesW 4y ago
It seems like being employee-owned might be a prerequisite for that, but I'd love to see examples that persuade me otherwise. There are tech co-ops, which are worker-owned: https://tech-coops.xyz/ https://tech-coops.xyz/
yabones 4y ago
"co-op" or "co-operative" is what I see them being called in Canada. A few small "craft" industry in my town is structured like that, where every employee is an owner with a stake based on their position, tenure, etc, and all profits are distributed back out each quarter/year. They're also common in agriculture, where a feed mill will be owned by all the farmers that use its services and/or store their grain there. https://en.wikipedia.org/wiki/Cooperative https://en.wikipedia.org/wiki/Cooperative
NickC25 4y ago
Crazy thing is that moves like this also benefit shareholders, albeit indirectly. A company that employees want to work for because they know they'll benefit first means that more and more of the top job seekers will try to work there, which means (indirectly) that the company will have the best of the best employees. As an investor, I would think that in the long term, that's the best use of the company's money and the best path to long-term growth. I don't want a quarterly, biannual, or annual dividend if that means that that excess capital will be re-invested into better employees (or keeping current top employees) who produce better products which can better position the company in the long run. For a long time I naively thought that was the whole point of investment: long term sustainability and allocation of capital that allowed companies to best compete.
- rcme 4y ago
  What you say is true: investing in employees attracts top talent. However, that's only one side of the equation. The other side of the equation is that such policies cost money. So in order to say that this policy is a "benefit to shareholders", you'd need to demonstrate that the benefits outweigh the cost, which is of course impossible to quantify. Over the last 5 years, stock in Mercedes Benz Group is down almost 25%, so I wouldn't say that, generally, Mercedes has been good to shareholders.
  - linster 4y ago
    Down 25%? Mercedes Benz Group AG https://g.co/kgs/Qm7LK4 https://g.co/kgs/Qm7LK4
    - rcme 4y ago
      Oh sorry I was looking at the U.S. listed ADR, which is affected by currency fluctuation.
  - edmundsauto 4y ago
    Is that the best way to evaluate it? It looks like they also offered about $3-4 dividend each year. The stock is down $5 over the last 5 years, but has also produced almost $15 worth of dividends[0]. For comparison, Ford might be up by about 25% (+$2-3) last 5 years, but it has only yielded a dividend of around $3. [0] https://group.mercedes-benz.com/investors/share/dividend/ https://group.mercedes-benz.com/investors/share/dividend/
hcal 4y ago
They exist in several forms. In the US I think the best kind are called employee-ownership-trusts or worker-owned cooperatives.
culi 4y ago
Employee-owned? A co-op? B-corp assessment also includes worker satisfaction and ownership as part of its assessment: https://www.bcorporation.net/en-us/best-for-the-world-2022-workers https://www.bcorporation.net/en-us/best-for-the-world-2022-w...
londons_explore 4y ago
There are corporate structures where all shareholders are employees and vice versa. "cooperatives". They tend not to be a great structure for fostering a massive growth, massive risk, massive profits type company.
dan1234 4y ago
In the UK, there's John Lewis[0], a company that is owned by a trust on behalf of its workers (who are known as partners, not employees). [0]https://en.wikipedia.org/wiki/John_Lewis_Partnership https://en.wikipedia.org/wiki/John_Lewis_Partnership
- aryehof 4y ago
  Learning this makes me more inclined to shop there!
lm28469 4y ago
Are you some kind of communist ? /s
nickbauman 4y ago
The most radical are Co-Ops. The workers own the company. They're called Worker-Owners. Where management is a skill, not a rank. The problem with this model is three-fold: • Outside investment can undermine the Co-Op's autonomy (many don't allow it) • Raising capital is hard; usually you're bootstrapping (worker-owners must divert some of their income) • Sometimes worker-owners get caught up in the democratic process of collective decision-making and get frustrated On the other hand: • A real Co-Op is real community. They exist to support the humans through work. You're all in this together. You can be "kicked out" by vote, but when you do, you give up your share and all that share money accumulating is yours. • You are "The Man" in the worst and best way you can imagine If something is wrong with the company, you can change it. • No more perverse mgmt incentives. The biggest Co-Op is the Mondragon. They are very successful, too. https://en.wikipedia.org/wiki/Mondragon_Corporation https://en.wikipedia.org/wiki/Mondragon_Corporation
mempko 4y ago
Welcome to socialism. This is what actual socialists want. Everyone to have ownership in the company and participate in it's success. Where the decisions are made democratically by workers. In the modern world, you will see this in co-ops today.

bradhe 4y ago

[flagged]

jmknoll 4y ago
In case you’re new to HN, here are the guidelines we follow around posting & commenting. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html Please try to avoid snarky or dismissive comments, and ensure that what you’re writing makes a point and contributes to the conversation.
- pc86 4y ago
  It's pretty easy to see when a profile was created. Theirs was created 5-6 years before yours. Sometimes comments like this get the point across in ways some self-aggrandizing $WALLOFTEXT can't. €7,300 is chump change.
  - eddsh1994 4y ago
    In Europe that's a good bonus in a place the average income is around 35k...
  - gambiting 4y ago
    I work in tech and the biggest bonuses I ever received were about £5-6k(pre tax too). That's pretty good money to be given as a bonus.
  - alistairSH 4y ago
    €7,300 is chump change Spoken like a true tech bro. In most suburban areas of the US, that's ~3-4 months rent. Or more than a year of car payments. Or a year and a half of groceries for an average American family. "Chump change" LOL.
  - whatatita 4y ago
    Nah, 7'300 is a good bonus. I've never heard of a five-figure bonus outside of FAANG or long-standing senior positions in old companies such as law firm or banking.

digdugdirk 4y ago

"The company's management and General Works Council have jointly agreed to pay all eligible employees a special lump sum bonus of up to 7,300 euros, a figure that is even higher than the current maximum payment cap of 6,465 euros." This General Works Council seems to be something like a separate "union within the company", in addition to whatever union represents various workers within the organization. On top of that, Mercedes Benz has a corporate Supervisory Board with 1/2 of the members representing the employees. Interesting how this structure has a headline like this one, vs the ">10k workers laid off from giant corporation with record profits for the past two years" headlines that seem to be popping up here daily.

amalgamated_inc 4y ago
Having a supervisory board w/ 1/2 of members representing (non-management) employees is mandatory by law for any corporation over 50 (?) employees in Germany. The "General Works Council" is just that board, I believe. So this is quite a normal setup for a large German company.
- arez 4y ago
  It never mandatory to have a Betriebsrat in Germany even with 100k employees you could not have one. You can however start one already with 5 full-time employees. Companies tend to have one around 50+ employees because before that it rarely makes sense
  - amalgamated_inc 4y ago
    So it's not mandatory if somehow all employees decided not to form one, but if any of them wanted to, it's mandatory to let them and presumably support them/listen to them in some way?
    - wirrbel 4y ago
      Basically it’s not mandatory in the sense that you will not be fined as a company if you do not have one. However, employees can make a motion to elect a Betriebsrat (works council) in a given location. Then, if 3 locations have a local Betriebsrat the Gesamtbetriebsrat can be formed which is regularly elected across the whole German staff. Grocery chains like Lidl and Aldi have prevented the formation of a Betriebsrat by employing union busting style measures (intimidating or firing staff, etc). Iirc teslas giga fab does not have an elected Betriebsrat. Since many American companies incorporate in Germany for their German branches, they can also face Betriebsrats elections. Overall I do think a Betriebsrat is a net positive for a company. It’s not always as profit oriented as an executive but it has a long term interest in the company as opposed to executives who just think in quarter years and about keeping shareholders happy.

bluedino 4y ago

Very common in automotive companies during the good times. Heck they can even get bonuses when the union starts a new contract with the automaker.

delecti 4y ago

Seems this story only applies in Germany, but their US tech workers also get a bonus at the same time that is partially based on company performance. My bonus last year was very nice because they've been doing so well (in the ballpark of $50k as a senior dev), and it looks like it'll be similarly nice this year too.

andsoitis 4y ago
How does your salary compare to tech companies? I know levels.fyi isn’t very accurate, but it’s all I’ve got and it doesn’t look that stunning. On the other hand, maybe the culture, meaningful work, etc. is better so lower pay is fine: https://www.levels.fyi/companies/mercedes-benz/salaries https://www.levels.fyi/companies/mercedes-benz/salaries
- Der_Einzige 4y ago
  Levels.fyi is highly accurate actually.
- delecti 4y ago
  Salary is quite a bit higher than this shows (the "software engineer" salaries listed here are for Germany, not the US), but there are no stock options, so total comp is probably lower than FAANG. I started as a "engineer" (P2, between junior and senior) at 135k 5 years ago, and each level has come with a ~20k raise, plus annual raises in between. The bonus percent gets bigger too: as a P1-2, your bonus target is 10% of salary, at P3 it's 12%, and P4 is 14%. That's further modified by personal performance and company performance (0-1.5x for personal, and 0-2x for company; last year I was at 1.44x and 2x respectively, for a bonus of ~35% of my salary). They're also not stingy with promotions, I've been promoted twice in under 5 years, and my base salary is currently ~180k. I worked at Amazon for 5 years before here, and have been here for another 5. The job is less stressful, the work is more meaningful (to me anyway, in that cars are more interesting than web ads were), the culture is more fun, and things are less cutthroat. I probably don't quite make FAANG money, but I don't put up with FAANG BS either. And yes we're hiring https://jobs.lever.co/MBRDNA https://jobs.lever.co/MBRDNA
4y ago

josefresco 4y ago

Bonuses are cheaper than pay increases.

KMag 4y ago
They're also better for stability in numbers of employees, as it's easier to reduce expenses in bad years without having to go through layoffs.
- vlowrian 4y ago
  True. On the other hand, if the increase in revenue is at least partially caused by inflation and it's not to be expected that deflation will revert this effect any time soon, new hires might expect significantly higher wages then what is currently paid within the company. If the current workforce is keeping their pre-inflation wages and new hires are receiving higher wages, this causes an increase in turn-over rate which is exactly what can be seen in Germany throughout the last two years. Admittedly, there might be other, additional causes to this. It should still be considered if higher turn over is a business risk for the company.
  - KMag 4y ago
    I think most companies and industries where bonuses make up a significant portion of total compensation still usually have annual inflation adjustments to base salaries, largely to avoid this problem. In an ideal world, people would be a bit better about managing uncertainty and most people would be able to live comfortably within their means on their base salaries and would have the restraint to invest large percentages of their bonuses.
    - vlowrian 4y ago
      Fair, but then it's not a question of either one or the other. Im not arguing against bonuses. It just shouldn't be the only outcome of what's expected to be a permanent increase in revenue.

kristaps 4y ago

Meanwhile at Tesla ..

bryanlarsen 4y ago
Meanwhile at Tesla employees have become millionaires off of stock options. Crappy place to work for other reasons, but pretty much everybody gets RSU's.
- recursive_ 4y ago
  There's a big difference between stock options and RSUs. Nobody became millionaires off RSUs unless they started at Tesla <2018. I'm not convinced everyone at Tesla is offered options.
  - bryanlarsen 4y ago
    Take this as the heresay as it is, but pretty much everybody at Tesla gets at least $20K in RSU's. If you got that pre-IPO and kept it this long it's worth more than a million. But even if it doesn't appreciate at all, over 4 years that's a similar payout to the MB payout referenced in the article.
    - kgwgk 4y ago
      > If you got that pre-IPO Do you realize that Tesla has gone from 1k to 100k employees in the meantime?
- deleted 4y ago
  [deleted]
- PuppyTailWags 4y ago
  The people working in the tesla factories, the line workers, are millionares? Get RSUs?
rcMgD2BwE72F 4y ago
employees are working on cars that are competitive, whose price are becoming more affordable and that fit people's expectation (cheap to maintain, highly efficient, compatible with a sustainable future)? I'd prefer to work at a company that will hire en masse in the coming years, than at one that's rich on paper but prefer to pay dividends and one-time bonus while having no reasonable roadmap for the future of mobility. I hear the Qataris and Saudis are paying well, too.

andsoitis 4y ago

Doesn’t Mercedes-Benz pay very very poor salaries?

aiqq 4y ago
Considering how small these “record” bonuses are they probably do pay a very very poor salary.
- wirrbel 4y ago
  The base salary is solid and high. It’s a salary and not a lottery.

vlowrian 4y ago

I work for a small-mid sized German software engineering company (~200 employees). Last year the company raised all wages by 7,500.- EUR (additionally to the usual raises). This was not a one-time payment, but a permanent increase in pay and it was the same absolute amount for all employees (including office management and other non-engineering departments). The reasoning behind this decision was that the inflation was hitting employees with lower income harder than employees with higher income positions. Whenever I'm seeing posts like this, I wonder if "up to x Euros" isn't the other way around and smaller incomes are on the lower end of the bonus range. Link (content written by our PR department, in German): https://www.presseportal.de/pm/164280/5271230 https://www.presseportal.de/pm/164280/5271230

judge2020 4y ago
> The reasoning behind this decision was that the inflation was hitting employees with lower income harder than employees with higher income positions. Isn't part of inflation that this doesn't work at scale? As in, if everyone gets higher wages, bigger bonuses, and more money is being poured into 401ks, inflation gets even worse? Or do wages become a rounding error when you add in stuff like real-estate and loans?
- vlowrian 4y ago
  Sure. But this is more of an argument against raising all wages relative to inflation. Inflation (at least in Germany) raised mostly prices for everyday goods - like food, fuel and rent. Raising the wages by an absolute amount meant helping those whose expenses are mostly basic goods, not trying to match inflation with pay raise.
- Closi 4y ago
  > Isn't part of inflation that this doesn't work at scale? As in, if everyone gets higher wages, bigger bonuses, and more money is being poured into 401ks, inflation gets even worse? Or do wages become a rounding error when you add in stuff like real-estate and loans? Kind of, but wages are only part of the cost of goods. Assuming wages represent 30% of the cost of goods (i.e. 30% labour, 20% property/fixed costs, 50% materials) and wages go up 10%, then they only impact the cost of goods by 3% (thus 3% inflation might be expected at a simplistic macro level). Then there is a sort of loop where the 3% inflation could encourage another 3% wage inflation, but that only affects the cost of goods by 0.9% and so on. When you follow this theory, that 10% wage inflation only turns into an additional c4.5% increase in inflation (or 15% if you include the initial 10%). This is overly simplistic and there are other levers at play, which is why lots of economics calculations often have continous simulations which can show the impact of these feedback loops (Inflation causes wage increases causes inflation causes wage increases).

froggertoaster 4y ago

Very nice. Still not buying their cars until they get their long-term reliability and depreciation issues worked out.

aiqq 4y ago
Dont worry bmw and audi are in the same boat i dont understand why people think these are good cars.
- michaelcampbell 4y ago
  Because historically they have been, comparatively to other brands. They're getting to be far too complex to be reliable, and too much attention is paid to short term profits (IMO), so we get what we have now.
  - aiqq 4y ago
    Historically they have been but most innovation at least from bmw comes from slapping extra turbos to chase ever increasing bhp. Interiors are mainly the same but with updated instrument clusters and redesigned exteriors. Not groundbreaking i think what is happening is too much attention to short term profits and forcing customers to refresh their cars every few years. Literally after they out of warranty bmws fall apart not to mention mercedeses that fall apparent even within warranty (the m and s class do).
  - jandrese 4y ago
    BMW has never had great longevity. They're mostly fine for 100k miles, but people expect cars to last much longer than that now. Old BMWs have solid reputation as a money pit.
orangepurple 4y ago
Those are precisely the sources of revenue that allow bonuses to be paid out to workers.
- 4y ago

PragmaticPulp 4y ago

The optics on this one have been fascinating to watch on social media. I've seen a lot of people in my own network who work at U.S. tech companies share this as an example of what companies should be doing. A lot of contrasting takes about how U.S. companies are laying people off while MB is handing out higher than expected bonuses. Meanwhile, I know for a fact that a lot of the people sharing this are getting paid significantly more than these employees and also have bonus plans that pay out several multiples higher than the highest MB payout (7300EUR) even in a bad year. Maybe this is an example of managing expectations. Mercedes-Benz paying four-figure bonuses to employees is noteworthy largely because they're paying more than expected. Meanwhile, I see people who earn significantly more being unhappy because their compensation was less than some number they expected. Interesting lesson in how expectations are relative, not absolute.

dahfizz 4y ago
> Interesting lesson in how expectations are relative, not absolute. Yup. I have a hard time taking any of the whining on HN seriously. People being paid $300K+ but all they can do is complain that they attend too many meetings. People that job hop once a year but the idea of layoffs is high treason.
- erulabs 4y ago
  I’ve been chastised before for suggesting “there is no humanitarian crisis” when engineers (like myself) are laid off. A strange “I deserve to be employed like this” vein, which is natural, but wrong.
- lm28469 4y ago
  > whining on HN seriously > People being paid $300K+ It's probably very far from the average HNer
  - donkeyd 4y ago
    Agreed. I'm not even nearing 1/3 of that. It is, however, a fact that a relatively high amount of HNers earn way over 100k due to the prevalence of people form SV on here. Tech salaries in the rest of the world are nowhere near those in SV.

squokko 4y ago

Car companies are in for a rough 2023 so if Mercedes loses money will they deduct from their salary?

sschueller 4y ago
Do car companies claw back dividend payments?
pjc50 4y ago
No? Why would they do that? This is a 2022 bonus. Lack of profit might mean a smaller or no bonus at the end of 2023, though.

stuaxo 4y ago

Lets see if the thing where big companies applies here, (it won't).

timdaub 4y ago

Coming from Stuttgart, Germany, it is well-known that if you get any position within the local automotive industry, it counts as making it. Doesn‘t matter what level, even if you work on the assembly line. So I interpret this post as follows: HN discovers that building German cars is a very good business.

akullpp 4y ago
True, my uncle stayed his entire life and now got an insane amount for early retirement. Myself on the other side worked 2 years as a software engineer and that's as much as I could taake: * politics * too many artificial restrictions * worst management I've ever experienced * Work doesn't get valued at all, cancelling so many projects and ideas amounting to nothing * lower reputation than "real" engineers, they still don't understand the value of software, like so many German companies, and treat us as necessary evil, which is also resulting in not competive salary If you shut up and just come to work every day, you certainly "made it", but for me that's impossible.
ChuckNorris89 4y ago
>HN discovers that building German cars is a very good business. I'd rather we all cycle everywhere like the Dutch and need less cars.
- ivan_gammel 4y ago
  Even with bikes there's still a lot of use cases for cars. With EVs, autonomous driving and current trends in urban mobility chances are high that automotive companies will become fleet management companies in 20-30 years (Uber has no chance to survive in the long term).

lvl102 4y ago

Record profits everywhere while inflation raged on. Only one explanation then for inflation: PRICE GOUGING. Corporate greed during global pandemic. Capitalism at its finest. Now we all have to pay the price just like on 2009. Privatize profits. Socialize losses.

umeshunni 4y ago

Something missing from this conversation is that Mercedes is one of the few 'legacy' carmakers that are managing the transition to EVs and automated driving well. They have flagship EVs - EQE, EQB, EQS that are well reviewed. They are the first car company to get approved for L3 self-driving in the US: https://insideevs.com/news/630075/mercedes-first-to-offer-level-3-self-driving-in-the-us/ https://insideevs.com/news/630075/mercedes-first-to-offer-le... and they are building out their own network of charging stations: https://insideevs.com/news/629594/mercedes-ev-charging-network/ https://insideevs.com/news/629594/mercedes-ev-charging-netwo...

ericd 4y ago
They have some, but are they producing them in significant volume? Most car makers have some models, but seem to be having trouble scaling them up.
- r00fus 4y ago
  Given their pricing (high end) they are definitely available in my area. It's not like Hyundai a few years ago where you couldn't find their EVs anywhere outside of southern CA. Just looked even Hyundai/Kia are available near me as well.
rcMgD2BwE72F 4y ago
Do they manufacture and sell these cars? I see ads and read editorials but I can't find these cars on the road. I'm afraid they use this EVQ-T-B-D-R to impress, then get people to contact their dealers who dissuade them to go EV just yet, and finally sell the biggest ICE or hybrid possible. That's what happened with my dad who went to Lexus (for a heavy plugin hybrid, sigh).
- spery 4y ago
  I see them quite a lot in Berlin.

jedberg 4y ago

This is what happens when your country has laws requiring workers to sit on the board. Aka strong unions by law.

tracker1 4y ago

It's funny in that the structure is inherently what Economic Fascism is, separating the economics from the nationalism/racism typically associated (from Nazi Germany). The economic bits seem to hold over though. Nothing is really stopping similar organization from happening in the formation of Corporation in the US and elsewhere. But it has to be part of the foundation of said company, especially if it's publicly traded, as it's very hard to do after the fact. I'm not convinced it should be restructured via force from the Government, and not even as a bailout, as I'm not a fan of those govt actions either.

xyst 4y ago

Just a sliver of the profits given to the plebs to appease the masses, media

kerpotgh 4y ago

Is this supposed to be a lot? I used to get 50% bonuses on my base (which was already high) when I worked on Wall St.

dang 4y ago

Is there a good third-party URL for some independent reporting about this? A corporate press release is not usually a good source for this kind of thing. This is a bit of an exception to HN's "original source" guideline. https://hn.algolia.com/?dateRange=all&page=0&prefix=false&query=press%20release%20by%3Adang&sort=byDate&type=comment https://hn.algolia.com/?dateRange=all&page=0&prefix=false&qu... https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html

lakomen 4y ago

Destroying the world with vehicles makes a lot of money. This company fuels the whole region ( suppliers etc ) where I live. Workers there are paid more than average, however compared to US salaries that's not much. So it's always perspective.

readonthegoapp 4y ago

what was this incredible strategy that was implemented? sounds fishy.