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DTNA Cuts Number of Layoffs on Strong First Quarter

March 20, 2013

By Deborah Lockridge

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Daimler Trucks North America announced it is laying off only half of the staff previously announced, on the heels of a strong first quarter and improving economic signals.

In late January, DTNA announced it was in the process of notifying about 1,200 workers of potential layoffs at plants in North Carolina, South Carolina, Oregon and Mexico. During a media event at the Mid-America Trucking Show Wednesday, Daimler officials announced that the layoffs would only affect about 600 workers.

"Luckily, with a very strong first quarter this year and a positive outlook, we were able to reduce that number," said Martin Daum, president and CEO, DTNA. The company staffed up last year for an expected upswing, but as orders fell off in the second half of the year, they had to take steps to match production capacity to demand.

Despite, that, DTNA had a very strong year in 2012. Head of Daimler Trucks Andreas Renschler, in his last media appearance before moving to take over Daimler's passenger car segment in two weeks, summarized Daimler Trucks North America's 2012 performance in two words: "DTNA rocked!"

The company saw clear growth in sales, up 18% over 2011 in the NAFTA region, up 17% in the U.S. and up 28% in Mexico.

Looking at Daimler as a whole, sales and revenues were up 9%, but "in the end, we did not reach all of our targets," Renschler said. "After the third quarter, we had to revise our expectations for profitability and EbIT downward, as forecasts for the world economy and our business worsened unexpectedly."

Daimler Trucks North America's booth at the Mid-America Trucking Show.
Daimler Trucks North America's booth at the Mid-America Trucking Show.

"But as we have always said: This business is cyclical. And we all know, despite short-term volatility, in the medium and long-term this business remains a growth business. By the end of this decade alone, the global truck market is expected to grow by another 2.2 million units."

Company officials have been pleasantly surprised by U.S. market share numbers so far this year. In U.S. Class 8, year to day through February was at 45.7%, and it was as 45.1% in U.S. Class 6-7.

"We had a tremendous head start in the market in January and February combined," Daum said. "Nearly every second truck in the market the first two months came from us. Will we sustain that pace? I think not. Will we be better and stronger than 2012? Definitely."

Later, Daum told journalists, "I think that was the first time you saw me speechless," adding, "I was not surprised by the direction but by the size of it." When asked for projections for where the company would end up in the market share battle at the end of the year, Daum declined to make any predictions. "We know to keep that position is a fight. The number at the end of the year will be higher than in 2012, that's our clear aspiration, our clear target."

For 2013, DTNA estimates total U.S. Class 8 retail sales will be between 175,200 and 214,200, compared to 194,700 in 2012. 

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