Daimler's Commercial Vehicle Business: sales up by 17% to 180K trucks in 1H 2011

Sales expand in Western Europe and North America; building new plants in India and China

2011/11/04

Summary

 Daimler AG makes about 30% of total sales through the commercial vehicle business, which consists of the three divisions of Daimler Trucks, Mercedes-Benz Vans and Daimler Buses.

 Compared to 2009 when sales volume drastically declined due to the financial crunch, the 2010 sales of Daimler Trucks were up by 37% to 355K units. Mercedes-Benz Vans and Daimler Buses had an increase in sales by 35.4% and 20.4%, respectively. In sales of the January - June period of 2011, the truck and the van divisions had growth by 17.1% and 15.0%, but the bus division had dropped by 4.8%.

 Daimler received orders for 240K trucks in the first half of 2011, which was the best record since the peak year of 2006. The German company expects that 2011 full-year sales will exceed those of the previous year. Daimler sees that sales of vans will increase but those of buses will stay flat.

 The medium- and heavy-duty truck markets in Western Europe and North America started on a recovery trend. Daimler plans to hire 2,300 new workers to meet the expansion of production in Germany and the US. To catch up with expanding demand in the emerging markets, Daimler will build new plants in India and China, and expand production capacity in Brazil.

 Launch of new models in 2011 include the Mercedes-Benz Citaro, a city bus, and the Actros, its first Euro6 compliant heavy-duty truck. As for electric vehicles, the medium hybrid truck Atego has been available since September 2010. In addition, the Vito E-CELL, the first electric van of Mercedes-Benz, is in the limited-production phase. It has undergone test drives on roads for demonstration experiments.



Truck sales in January -June period of 2011 are up by 17% to 181K units, targeting 2013 sales at more than 500K units

 Daimler Trucks encompasses worldwide markets by assigning its brands: Mercedes-Benz to Europe and South America, Freightliner and Western Star to North America, and Mitsubishi-Fuso to Asia. It produces and sells light-, medium- and heavy-duty trucks of each brand in each region. Mercedes-Benz Vans' focus is Europe, where it produces and sells GVW 1.9 to 7.5-ton vans. The core products of Daimler Buses are over 8-ton buses. They are sold under the Mercedes-Benz, Setra and Orion brands in European, Latin American and North American markets.

 The 2010 sales of three divisions of trucks, vans and buses drastically increased by 20 to 35% compared to 2009 when sales sharply dropped due to the economic crunch. In the January - June period of 2011, sales of Daimler Trucks and Mercedes-Benz Vans continued to grow, while those of Daimler Buses were down by 4.8%.

 According to the 2011 forecast by Daimler, truck sales will surpass the 2010 level aided by the economic recovery in Europe and the NAFTA region as well as the business growth in emerging markets. Daimler Vans sees that sales will expand as demand will increase in Europe, the US and China. Daimler Buses expects that finished vehicle sales will decline in Europe and the NAFTA region; nevertheless, overall sales will stay unchanged from the previous year level thanks to expanding sales of chassis in South America.

 The business targets of Daimler Trucks unveiled at the end of 2010 include sales of more than 500K units in 2013 (355K units in 2010).

Daimler's commercial vehicle business: sales volume by vehicle type

(units)
2006 2007 2008 2009 2010 Jan.-Jun.
2010
Jan.-Jun.
2011
Trucks 516,087 467,667 472,074 259,358 355,263 154,354 180,718
Vans 256,895 289,073 287,198 165,576 224,224 106,048 122,007
Buses 36,192 39,049 40,591 32,482 39,118 19,226 18,308
Total 809,174 795,789 799,863 457,416 618,605 279,628 321,033

Source: Daimler Annual Report 2010, Q2 2011 Interim Report
(Note) The Mitsubishi Fuso's data, which are included in the figures above, are as follows: 187,638 in 2006, 188,719 in 2007, 197,724 in 2008, 99,500 in 2009, 140,700 in 2010, 61,569 in the first half of 2010, and 47,160 in the first half of 2011.

 



Daimler expects European and North American truck markets to expand by 30-40% in 2011

 Daimler Trucks had increase in 2010 regional sales across all key regions of Europe, US, Latin America and Japan. Brazil, in particular, had drastic increase in demand for trucks thanks to its economic recovery and tax breaks. Sales in Latin America jumped by 56.8% as a consequence. Daimler also expanded its shares of the medium- and heavy-duty truck market in Western Europe from 23% to 24.3%, and of Class 6 - 8 truck market in the US from 30% to 32.6%. Daimler Trucks went to the top in either of the markets.

 In the January-June period of 2011, Daimler's truck sales in Western Europe grew by 28.6% with a sales increase in key markets, and those in the US market were up by 39.1% owing to strong competitiveness of the models in compliance with the 2010 emission gas regulations. Daimler's sales in the Latin American markets stayed nearly flat. Those in the Asian markets had marginal growth because the Great East Japan Earthquake stopped production.

 As for the worldwide truck markets in 2011, Daimler estimates that demand is likely to expand by 35 to 40% in Europe and by 30 to 35% in the NAFTA region, and contract by 10% in Japan as a consequence of the earthquake in March 2011. Demand for trucks in emerging markets will develop disparately. Sales in Brazil should grow by 15 to 20% thanks to the renewed tax break policy and tightened emission gas regulations. The Russian market is expected to have a growth rate in the double-digits. On the other hand, Daimler expects that growth in India will be more moderate. China, the world largest market, will experience a downturn in demand following the end of the state incentive program (according to the forecasts as of July 2011).

Daimler's commercial vehicle business: sales volume by vehicle type and region

Daimler Trucks division
(1,000 units)
Western Europe NAFTA (US) Latin America Asia Others Total
2009 44.0 62.0 52.0 37.0 87.0 29.0 259.0
2010 55.0 77.0 63.0 58.0 120.0 45.0 355.0
Jan.-Jun. 2010 21.2 n.a. 30.6 27.2 51.4 23.9 154.4
Jan.-Jun. 2011 27.2 n.a. 42.6 27.3 53.3 30.3 180.7
Mercedes-Benz Vans division
Western Europe Eastern Europe US Latin America China Others Total
2009 128.1 11.0 1.6 9.4 1.3 14.1 165.6
2010 156.8 16.4 10.5 12.5 12.2 15.9 224.2
Jan.-Jun. 2010 76.2 6.7 5.2 5.9 3.6 8.4 106.0
Jan.-Jun. 2011 83.3 10.4 7.8 5.8 6.0 8.7 122.0
Daimler Buses division
Western Europe NAFTA Latin America Asia Others Total
2009 7.2 3.9 16.3 2.0 3.1 32.5
2010 7.2 3.9 23.2 1.5 3.4 39.1
Jan.-Jun. 2010 2.8 1.6 12.6 0.5 1.7 19.2
Jan.-Jun. 2011 2.0 1.7 12.5 0.6 1.6 18.3

Source: Daimler Annual Report 2010, Q2 2011 Interim Report
(Note) NAFTA includes the US, Canada and Mexico.

 



Commercial vehicle business: revenue up by 5% and EBIT jumps by 74.9% in January to June period of 2011

 Daimler's revenue of commercial vehicle business was up by 26.3% to 36.39 billion Euros in 2010. Its EBIT (Earnings before Interests and Taxes) returned to a positive 1.989 billion Euros in the same year from a negative 792 million Euros last year thanks to volume increase and cost reduction. In the January to June period of 2011, sales volume also increased in Europe and the US. Revenue was up by 15% and EBIT jumped by 74.9% to 1.3 billion Euros as a consequence.

 According to the business targets unveiled at the end of 2010, Daimler aims to raise the EBIT margin to sales to 8% (5.5% in 2010).

Daimler's commercial vehicle business: business results

(in millions of Euro)
2009 2010 Jan.-Jun.
2010
Jan.-Jun.
2011
Production (1,000 units) 425 628 289 338
Revenues Daimler Trucks 18,360 24,024 10,726 12,890
Mercedes-Benz Vans 6,215 7,812 3,674 4,220
Daimler Buses 4,238 4,558 2,216 1,997
Total 28,813 36,394 16,616 19,107
EBIT Daimler Trucks (1,001) 1,323 430 889
Mercedes-Benz Vans 26 451 191 379
Daimler Buses 183 215 120 28
Total (792) 1,989 741 1,296
Capital investment 788 1,189
R & D costs 1,521 1,772
Number of employees 103,113 103,397 102,404 107,450

Source: Daimler Annual Report 2010, Q2 2011 Interim Report

 



European, US and Japanese markets: Daimler to create total 2,300 jobs in Germany and US

 Based on the orders received in the first half of 2011, the truck markets in Western Europe and North America are expected to drastically expand. Thus, Daimler Trucks will employ a total of 2,300 new workers in Germany and the US to expand production. In Japan, Mitsubishi Fuso unveiled the medium-term business plan. It says that the Japanese company will increase overseas truck sales to more than 200K units in 2015, twice as many as in 2010.

Daimler's activities in European, US and Japanese markets

Germany In August 2011, Daimler announced the hiring of, at most, 1,000 regular employees for the Mercedes-Benz Worth Plant to produce the new heavy-duty truck Actros from the end of September in addition to the increasing number of orders. Saturday shifts were already in place at the plant for the latter half of the year. It planned to start employing new workers starting in September and finish the employment activities by spring 2012.
US Daimler Trucks North America (DTNA) will employ new 1,300 workers in the US and Mexico in the first half of 2011.
DTNA was allowed to participate in the "21st Century Truck Technology Partnership" by the US Department of Energy in 2010. DTNA will be subsidized with total 40 million dollars over the next five years for development of clean and sustainable commercial vehicles and engines.
Japan Daimler subscribed the allocation of new shares to a third party worth 30 billion yen (about 271 million Euros) by Mitsubishi Fuso and increased the ownership from 85% to 89.29%. According to Mitsubishi Fuso, it will respond to international commercial vehicle markets which are expected to recover from now, and expand its business.
Mitsubishi Fuso in October 2011 unveiled the business plan "FUSO2015" by 2015. The plan includes increasing overseas sales from 116K units in 2010 to more than 200K units in 2015 by newly penetrating into emerging countries and expanding sales in North America where growth in the light truck segment is expected.

Source: Daimler Annual Report 2010, Q1/Q2 2011 Interim Report, Press Release on August 12, 2011, Press Release by Mitsubishi Fuso on January 11, 2011 and Nikkan Jidosha Newspaper on October 15, 2011.

 



Emerging markets: Daimler to build new plants in India and China, while expanding production capacity in Brazil

 Daimler started joint production of light trucks with Kamaz, a Russian local manufacturer, and it signed a memorandum of understanding with GAZ with respect to production of vans. In Brazil, it raised the annual production capacity by 15% to 75K units to respond to the rapidly expanding market. In India, Daimler will produce and sell light-, medium- and heavy-duty trucks under the India-exclusive brand BharatBenz. In China, it will jointly produce trucks with Beiqi Foton. In Algeria, it will have joint production of heavy-duty trucks and buses in cooperation with Aabar, a shareholder of Daimler, and the Algerian government.

Business development in emerging markets

Russia Daimler and Russian major truck manufacturer Kamaz established a joint venture Fuso Kamaz Trucks Russia at the end of 2009. The joint venture has produced and sold the light truck Fuso Canter at the Chelny Plant in Russia since April 2010. It produced about 1,000 trucks in the past one year. At the end of 2010, Daimler and Kamaz signed a memorandum of understanding with respect to cooperation for production of axels in Russia. Daimler took a 10% stake in Kamaz in December 2008, and raised the stake to 15% in the second quarter of 2010 to strengthen the strategic partnership with the Russian company.
In the fourth quarter of 2010, Daimler and GAZ, a Russian commercial vehicle manufacturer, signed a memorandum of understanding with respect to the production of Mercedes-Benz Sprinter vans in Russia. It also plans to locally produce engines, transmissions and axles for the Sprinter and other GAZ products.
Brazil Mercedes-Benz do Brasil is spending 650 million Euros to enhance two plants which produce trucks and its R&D center from 2010 to 2013. It announced the employment of a total of 1,250 new workers in June 2011 (including those for the Argentina Plant). It started the third shift at the Sao Bernardo do Compo Plant; thereby the annual production capacity was raised by 15% to 75K units. Mercedes-Benz do Brasil will add facilities to the Juiz de Fora Plant, planning to produce the heavy-duty truck Actros from 2012.
The 2010 sales of six-ton or heavier trucks were 162K units in the Brazilian Market. Expecting the sales to increase to 200K units or greater in 2020, Daimler is speeding up preparations to seize expanding demand.
India Spending 44 billion Rupees, Daimler India Commercial Vehicles (DICV) is building a commercial vehicle plant in Oragadam of Tamil Nadu State. DICV will produce under the new brand BharatBenz (Bharat means India) exclusively for the Indian market at the new plant from 2012, planning to offer all commercial model vehicles of a GVW of 6 tons to 49 tons. It will develop new brand trucks, of which light trucks will be based on the Mitsubishi Fuso Canter, and medium- and heavy-duty trucks on the M-Benz vehicles.
According to Daimler, India's economy is expected to grow by 7 to 8% over the next decade. The Indian medium-/heavy-duty truck market already becomes the second world largest to China. The Indian market scale is expected to double in 2020 from the current scale.
China Daimler and Beiqi Foton motor were approved by the Chinese Government (Ministry of Commerce) in September 2011 to establish Beijing Foton Daimler Automotive, a fifty-fifty commercial vehicle joint venture. The new company will develop and produce medium- and heavy-duty trucks and engines for them. It will have an annual production capacity of 160K trucks. Daimler plans to sell them under the Foton Auman brand in and outside China.
Algeria Daimler, the Algerian Government and Aabar Investment PSJ (a UAE corporation which has a 9% stake in Daimler) signed a memorandum of understanding in March 2011, with respect to joint production of heavy-duty trucks and buses in Rouiba City of Algeria. Daimler will supply parts and provide technical assistance to the venture company. The venture established by Aabar and the government will take responsibility to assemble products. Daimler attempts to strengthen the presence in North Africa and respond to the expanding Algerian market through the joint production.
Daimler, the Algerian Government and Aabar also signed a memorandum of understanding in July 2009. The memorandum stipulates that Daimler shall provide modules for the Sprinter (van), the Unimog (a multi-purpose truck) and the G-Class (SUV).

Source: Daimler Annual Report 2010, and Press Releases on February 17, 2011, March 22, 2011, June 30, 2011 and September 26, 2011

 



New models: Daimler launches heavy-duty truck Actros in conformance to Euro 6 emission gas standards

 Daimler launched the new city bus Citaro in May 2011, and the new heavy-duty truck Actros in July. The new Actros is in conformance to the upcoming emission control standards of Euro 6. Mitsubishi Fuso launched the new light truck Canter in Japan in November 2010. The Canter will be launched in more than 40 worldwide markets as one of the Daimler Group's global strategic models by the end of 2012.

Launch of new models (autumn in 2010 to summer 2011)

Mercedes-Benz
Citaro
Daimler Buses unveiled a new model of the Mercedes-Benz Citaro in May 2011. More than 31,000 units sold in 13 years make the Citaro the best selling city bus. The new model bus is equipped with the Blue Tec engine; thereby, the bus satisfies Euro 5 emission gas control and EEV (Enhanced Environmentally Friendly Vehicles) standards. Besides, the new Citaro is the first city bus model equipped with the ESP to increase safe performance.
Mercedes-Benz
Actros
Daimler Trucks launched the new heavy-duty truck Actros in Europe in July 2011. 700K units of the Actros were sold over 15 years. The new Actros is the first model that meets Euro 6, the upcoming emission gas control standards of Europe (applicable to new model vehicles from 2013, and existing models from 2014). Daimler Trucks will also launch the new model in compliance with the current Euro 5. The fuel economy of the new Euro 6 conformable model improved by 4.5% from the previous model, and that of the Euro 5 compliant model by 7.6%.
Fuso Canter Mitsubishi Fuso launched the fully remodeled light truck Canter in Japan in November 2011. It is equipped with a fuel efficient 3L "4P10 type" diesel engine, which was jointly developed with Fiat Powertrain Technologies, the Blue Tec system for the first time as a Japanese light truck (DPF regeneration control system + urea SCR) and the dual clutch transmission for the first time as a truck in the world. The fully-remodeled Canter surpasses the 2015 heavy-duty truck fuel consumption standards by 2 to 7% and reduces NOx and PM by 30% from the post new long term emission gas control standards.
The new Canter was developed according to the "Commercial Vehicle Development System" implemented worldwide by Daimler Trucks. It was introduced as the global strategic model in North America in March 2011, Australia in May, New Zealand in July and Hong Kong in September, following the launch in Japan. It plans to produce the model in Portugal from October 2011, and introduce it in European markets. By the end of 2012, Daimler plans to launch the model in more than 40 overseas markets.

Source: Daimler Press Release on June 29, 2011; and Mitsubishi Fuso Press Releases on November 11, 2010 and October 17, 2011

 

 As for electric vehicles, Daimler launched the medium HV truck Atego BlueTec Hybrid in September 2010. At the end of 2010, it produced the Vito E-CELL, the first electric van of Mercedes-Benz, which underwent test drives on road. Utilizing the HV system of the light duty hybrid truck, Mitsubishi Fuso is developing a heavy-duty hybrid truck.

Launch of electric vehicles (since autumn 2010)

Mercedes-Benz
Atego BlueTec
Hybrid
Daimler Trucks unveiled the production model of the Mercedes-Benz Atego Blue Tec Hybrid (a medium-duty hybrid truck) in June 2010. After that, Daimler Trucks delivered 50 of them to short-distance transportation companies for test drives on roads as part of the "Electric Vehicle Promotion Program" by the German Government. Daimler Trucks launched the model to public from September 2010. For Daimler, it was the first launch of a commercial model hybrid truck in Europe.
The Atego BlueTec Hybrid is equipped with a parallel HV system. It has a 4.8-liter four-cylinder engine of a maximum power of 160 kW and a maximum torque of 810 Nm. It employs a permanent-magnet motor of 44 kW and 420 Nm at maximum, and a lithium-ion battery of 2 kWh. The engine has a better fuel consumption by 10 to 15% and produces much less noise than current diesel engines.
Mercedes-Benz
Vito E-CELL
The Mercedes-Benz Vito E-CELL is the first electric van of Mercedes-Benz. The lithium-ion battery of 36 kWh is mounted below the floor to ensure a wide trunk space. The motor produces a power of 60 kW and a torque of 280 Nm at maximum. The electric van travels 130 km per charge and has a maximum load of 900 kg. The maximum speed is limited to 80 km/h in consideration of its purpose and cruise distance. Mercedes-Benz produced a hundred units by the end of 2010, which are undergoing test drives on roads in Berlin and Stuttgart. In the next phase, it will produce 2,000 units to introduce them all over Europe.
Mitsubishi Fuso
heavy-duty HV truck
Mitsubishi Fuso and Daimler jointly developed the Super Great Eco Hybrid, a heavy-duty hybrid truck of a GVW 25 tons. It is undergoing test drives (according to the news report in October 2011). Mitsubishi Fuso developed the inverter for a heavy-duty model by exploiting the parallel HV system mounted on the Canter Eco Hybrid, a commercialized light hybrid truck. The fuel consumption was improved by 10% or greater than current diesel engines and achieved 4.4 to 4.8 km/liter. The Super Great Eco Hybrid is capable of reducing the emissions of CO2 by 11 tons over a journey of 150,000 km on the freeway.

Source: Daimler Press Release on September 27, 2011; Presentation "The New Atego" on June 29, 2010, and Nikkan Kogyo Newspaper on October 17, 2011

 



(Reference) Daimler's production of medium- and heavy-duty trucks and buses by country

Daimler's production of medium- and heavy-duty trucks and buses by country

(units)
Brand Heavy Trucks Buses
2008 2009 2010 2008 2009 2010
Germany Mercedes 118,576 49,180 78,301
Evobus 5,919 5,347 4,710
Unimog 1,236
France Evobus 630 667 551
Portugal Fuso 4,770 944
Evobus 177 82 95
Mercedes 347 2,376
Spain Evobus 1,293 699 962
Turkey Mercedes 16,807 3,691 12,050 3,510 2,773 2,462
Argentina Mercedes 1,531 443 106
Brazil Mercedes 43,254 34,156 47,064 22,595 18,756 26,675
Canada Sterling 11,568 1,267
Mexico Mercedes 5,473 2,665 2,886
Freightliner 24,158 18,055
USA Freightliner 49,122 18,925 65,167 7,010 6,873 6,206
Mercedes 185
Western Star 3,432 1,988 3,560
TBB 4,347 3,738 4,146
Orion 819 1,069 743
Japan Fuso 122,200 54,600 98,200 15,274 8,194 11,409
Total 395,123 183,153 306,903 68,578 51,306 60,951
Source: OICA (International Organization of Motor Vehicle Manufacturers)
(Note) 1. The data include trucks and buses with GVW of 6t or greater.
2. Fuso of Japan is Mitsubishi Fuso Truck and Bus. TBB of the USA stands for Thomas Built Buses.

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