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DaimlerChrysler Plans to Optimize Business Model for Commercial Vehicles

June 21, 2005

FRANKFURT, GERMANY — DaimlerChrysler AG will optimize its business model and strategy for its commercial vehicles unit. The program, “Global Excellence,” will focus on improving “short-, medium-, and long-term goals primarily aimed at increasing efficiency and exploiting economies of scale,” according to a company statement. The company said it hoped to lower material expenses and fixed costs and, at the same time, increase flexibility of its production plants in Germany and abroad. “Our aim is to keep the division profitable in the future regardless of market developments,” said Andreas Renschler, the board member overseeing commercial vehicles for the company. “To do so, we will continue to pursue our profit margins instead of sales volume policy.” DaimlerChrysler 2004 global sales of approximately 712,000 trucks, vans, and buses, were 42 percent higher than the year before. The company’s commercial vehicles division — which includes Portland, Oregon-based Freightliner — posted an operating profit of $926 million during the first quarter, a 166 percent increase over last year’s profit. Part of the increase result from DaimlerChrysler’s settlement with Mitsubishi over defects at Fuso: Mitsubishi agreed to pay DaimlerChrysler for costs associated with vehicle recalls, and to transfer over its 20 percent stake in Mitsubishi Fuso Truck & Bus Corp., giving DaimlerChrysler an 85 percent stake.
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