Daimler Trucks Execs Share Successes, Peek into Future
October 21, 2013
"This takes a certain type of courage and confidence, but I think we know what we are doing, because we saw the fairly extraordinary results from the get-go when it comes to fuel efficiency," he told reporters last December at the Detroit plant.
In Orlando Monday, he said that with only half a year of production (the transmission officially launched in May), DTNA has already sold 3,600 DT 12 transmissions, and has already delivered about 2,000.
Martin Daum, president and CEO of Daimler Trucks North America, says you don't get market share by just saying you're going to. (Photo by Evan Lockridge)
"When we start production in Detroit, I'm sure every transmission built in Detroit will stay in the U.S.," Daum said. Initially, he admitted, there was some talk about exporting some of the U.S.-made transmissions as a backup to Daimler's Gaggenau, Germany, transmission plant, but now, he says, he wouldn't be surprised if the Detroit plant won't be able to keep up with the U.S. demand and the company might have to bring some in from Gaggenau, where they are currently being produced.
He also highlighted Daimler's success in the medium-duty marketplace; earlier this year DTNA took the number one market share spot in that business away from longtime leader Navistar International.
"It's not just the weakness of others that has led us to thrive in that sector," Daum said. "It's attention to details, it's talking to body builders, working on product features, doing it industry by industry, segment by segment. We took our time to really unravel that market. We are here in that market to stay, not just to thrive on the weakness of others," he said.
Looking ahead, while neither Daum nor Bernhard would provide any details, it was clear that the company is working on solutions to drive wider adoption of natural gas, perhaps in areas such as a larger engine and lighter-weight, lower-cost fuel systems. Daimler recently worked with Saddle Creek Logistics to develop a natural-gas tank system that was lighter weight and more aerodynamic.
Also expect to see more from the Western Star brand in the next year, they said.
"Obviously there are global manufacturers, but no global customers," Bernhard pointed out. "At the point of convection, all business is local. We have to offer the right product for each customer in the marketplace," and that is very different from country to country and from application to application.
As an example, he showed a photo of a truck in India, where Daimler's new BharatBenz brand is making inroads despite a down market and cutthroat pricing environment. "These trucks are very basic, very simple trucks, geared toward highly overloading. We have to provide a 50 to 60% overloading margin. There is no air conditioning – it's 2-30 air, where you manually roll down two windows and drive 30 mph. And it's not upon us to judge; we have to give them what they need and the things they're really willing to pay for."
Those Indian trucks will be the foundation for Daimler's push into new emerging markets in Southeast Asia and Africa, areas where it is aiming to head Chinese truck makers off at the pass.
A Daimler wish list
Bernhard said while DTNA is an integral part of its global set-up, a "strong pillar," and it's showing that with investments such as the new Portland, Ore., headquarters, he had several areas he'd like to see some changes in.
1. Stability from Washington: "We need stable economies and a fair framework of regulations. I think we all can agree it is in our best interest for Washington to find a way to provide a stable long-term budgetary climate."
2. Coordinating with Europe: "Strong growth in Asian markets will lead to a shift in global economic power values," Bernhard said. "NAFTA and Western Europe have to close ranks. Ongoing TTIP trade talks are an opportunity to set future standards for the rest of the world. Establishing a free trade agreement is a big step in this direction."
He would like to see the different players accept each other's emissions and safety standards, which really aren't that different – in some cases simply a matter of different tests. "Getting rid of those small differences can lead us to big savings and increase our competitiveness. Both sides need to park our regulatory egos in the loading dock."
3. Greenhouse gas regs that make sense: "We need a full vehicle standard," Bernhard said. "There is discussion going on whether the engine should be singled out. We don't think that's helpful. The standard needs to recognize savings of the entire system. We have to have an open standard to include anything we might invent that lowers that CO2 in the future. You can't win the football game with just the great quarterback alone, a great engine."
4. Incentives for buyers of new, cleaner trucks: Bernhard pointed out that while trucks meeting the latest EPA 2010 emissions standards put out a fraction of the harmful diesel emissions as those made before the EPA started cracking down on emissions, "the U.S. emissions topic is far from cut and dried."
The problem is that very few trucks on the road today are actually those 2010-standard models: "60% of trucks in U.S. are from before EPA 98; less than 10% are EPA 10. Right now you could reduce NOx by 60% if you replaced all the old trucks with new trucks. You could reduce particulate matter by 99%."
Repealing the federal excise tax is one way to help with that, but Daum pointed out it's not likely to happen at a time when the government is strapped for cash. Daum suggested that if the excise tax could be reduced and the fuel tax increased to make up for the loss in revenue, that also would have the effect of rewarding people for buying newer trucks and penalizing those burning older, fuel-guzzling rigs.
"Fast fleet renewal is the key for improving air quality," Bernhard said.