Daimler India Commercial Vehicles targeting double-digit growth in 2018, says MD

Nesselhauf joined Daimler Trucks’ Indian wing in 2008 and built the local procurement and supply chain strategies from ground up. Under his leadership, the company accelerated its ramp-up in the domestic CV industry as it advanced to a production of almost 100,000 vehicles since 2012. This year, DICV is targeting to reach a double-digit growth. Excerpts from an interview: 

The foundation of DICV business unit has been solid. We have established processes and systems, international linkages and DICV is integrated into our global network. We will grow and accelerate faster. The first phase was difficult, but the current one will be easy as there is no need to build a fresh foundation. In three years, we are confident of reaching full capacity utilisation (72,000 units). This is achievable, provided there is no fluctuation in exchange rates or oil prices do not play havoc.

Developments in the Middle East do exert a big influence on businesses. In that case, the figure will be give or take 10,000 to 12,000 units. By December this year, we are targeting the break-even milestone. Incidentally, India is among the top five as far as sales of Daimler trucks are concerned. The split between domestic sales and export is 70:30.

Our domestic sales ranged over 75,000 BharatBenz units in India, while vehicle exports under the BharatBenz, FUSO, Mercedes-Benz and Freightliner brands spread to over 40 markets globally. More than 50 mn quality parts from India were supplied to other Daimler entities in Europe, Japan, North and South America. It may not be prudent to look at market share alone. To have one lakh trucks on the road is no mean feat. Our focus is on profitability and to be in the high-end segment. 

With infrastructure gaining momentum, our thrust will be on construction trucks – specifically the ‘modern segment,’ ie the booming e-commerce business apart from heavy tractor business. For us, the 25 tonner is not a key segment as our intent is to target vehicles that are in the Rs 2 lakh to 2.5 lakh km usage bracket, where fuel efficiency matters. We will see significant growth in 2018 followed by a good year in 2019. Ultimately, it is the total cost of ownership that matters to customers. Currently, DICV has over 150 dealers and 370 vendors.

Nearly 15-20 pc of suppliers have been on-boarded and some of them have even set up bases overseas. We were part of selecting and training a new set of suppliers to achieve the required localisation level of over 90 pc. India is on par with global standards. We are ready for BS-IV well ahead of time.

Daimler named research chief Ola Kaellenius as its next CEO on Wednesday in a succession plan that promotes a raft of tech-savvy managers at its Mercedes-Benz car brand and also seeks to install long-serving CEO Dieter Zetsche as chairman. The German automaker said the plan would provide certainty on future leadership at a time of upheaval in the car industry, though some commentators questioned an arrangement they said could leave Zetsche as a back-seat driver. 

Daimler said the 49-year-old Kaellenius would become chief executive in 2019 and the 65-year-old Zetsche would, if shareholders approve, become chairman of the supervisory board in 2021, following a standard two-year cooling off period. The elevation of Kaellenius, a Swede who often wears jeans and sneakers and attends tech conferences, marks the first time the 132-year-old Stuttgart-based inventor of the modern automobile will be headed by a non-German CEO without an educational background rooted in mechanical engineering.