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Daimler Exec: Production Ramp-up Won't Meet Demand

March 31, 2011

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LOUISVILLE, KY - Noting that "Everyone wants me to be the fortune teller here at the show," Daimler Trucks North America President and CEO Martin Daum predicted U.S. Class 8 sales of 153,000 for 2011, lower than we're hearing from other OEs. The reason? Truck production capacity won't be able to ramp up as fast as demand.


Speaking to reporters at the Mid-America Trucking Show, Daum said, "The market really rebounded, really changed in the last couple of months, which is a very good sign." In fact, the company has raised its NAFTA market forecast from 20-25 percent growth to 30-35 percent growth this year. Daimler is predicting total Class 6-8 sales in the NAFTA region to be 286,000, and Class 6&7 U.S. sales to be 85,000.

However, while he stopped short of agreeing with the statement, "If we could build them, we could sell them," Daum said the production capacity simply won't be there to meet the more optimistic forecasts.

Daum said he should know, because DTNA is ramping up production faster than anyone. They have gone from 4,200 production employees at the beginning of 2010 to 6,200 in March and are currently adding another 800 by the end of the second quarter.

"We are the first to ramp up, we are the most aggressive to ramp up, so I know the responses from our suppliers," he said. "I would like to increase production further and faster, but I can't, due to alack of commodities in the market, starting with tires … we run from one shortage into another shortage, so you just don't have the production to sustain [higher numbers]. I would love to, but unfortunately I can't. Even if I ramp up production in March, you won't see effect in the market until April or May, because it's just the normal pipeline thing, it has to go to the dealer, it has to go the customer, it has to be registered before it's counted."

When asked about who's buying the trucks, Daum noted that large fleets were backbone of sales in 2010, but by the end of 2011, he said it will be small fleets; "They are back in the market."

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