Daimler AG announced February 3 it would spin off its truck-building business from its Mercedes-Benz luxury-car company to form two independent enterprises. The final decision on the split will be made in Daimler’s third-quarter 2021 shareholder meeting.
Ola Källenius, chairman of the board for Daimler and Mercedez-Benz, noted in a statement that Daimler Trucks and Mercedes-Benz have different technology paths and capital needs. Daimler Trucks, the world’s largest truck and bus manufacturer, “supplies industry leading transportation solutions and services to customers,” said Källenius, while Mercedes-Benz is best known for its luxury consumer vehicles.
That distinction could send the two post-breakup companies down different paths when it comes to moves made to electrify Daimler’s products. Automakers building consumer and luxury electric vehicles are focused more on battery development, while truck manufacturers see hydrogen fuel cells as lighter and better suited for long-haul drives.
“Given this context, we believe they will be able to operate most effectively as independent entities, equipped with strong net liquidity and free from the constraints of a conglomerate structure,” said Källenius.
Manfred Bischoff, chairman of Daimler’s Supervisory Board, said the spin-off would not only allow each company to operate more independently in terms of capital goods needs and consumer bases, but would make the companies more attractive for investors. During a call with the media February 3, Källenius said he thought a standalone Mercedes-Benz might be seen as directly competitive with Tesla.
The company says splitting up will also allow each business to “keep pace” with a rapidly evolving business landscape. “The transformation of our industry is moving ahead quickly,” said Michael Brecht, chairman of Daimler’s General Works Council. Brecht also announced that Daimler AG would be starting an innovation fund of 1.5 billion euros, or $1.8 billion U.S. dollars, for Daimler Truck.