Daimler is set to make deeper cost cuts.

The Mercedes Benz maker says more action is needed ahead of an expected second-quarter operating loss.

In the first half sales of its flagship brand dropped by almost a fifth.

Though a recent surge in orders in China did offer some consolation.

Even so the company expects 2020 sales, revenue and profits all to be down on last year.

And it warns a recovery will be slow in coming.

The German giant says previous cost-cutting measures weren't drawn up with this kind of global recession in mind.

It's now in talks with unions over savings.

At a virtual shareholders' meeting Wednesday (July 8) Chairman Manfred Bischoff flagged one other big worry:

"The conflict between the United States and China, whether it be technological, trade related, socio-political or cultural about valid values can have a massive impact on our business."

Daimler operates plants in both countries, which are also its two biggest markets.

That could leave it vulnerable to any escalation in trade tensions.

As part of cost cuts Daimler has already put one plant in France up for sale.

That may now be bought by UK chemicals giant Ineos, which is getting into car making.

It recently unveiled a rugged SUV design, dubbed the Grenadier, which it plans to put on sale next year.