The 2015 Mercedes-Benz S63 AMG 4Matic Coupe loses 140 pounds but gains 4x horsepower. It's vehicles like this that has Daimler Chairman Dieter Zetsche expecting a big year.
Daimler AG predicts a big increase in earnings this year despite intense competition from its rivals, Audi and BMW.
“We are beginning 2014 at the same pace with which we finished 2013,” Dieter Zetsche, chairman of Daimler board of management and head of Mercedes-Benz Cars told shareholders at the company’s annual meeting.
“We also review our plans critically,” he said. “But they seem to have been successful. We will keep our foot on the accelerator.”
Daimler's truck unit is expected to have a strong 2014 leading to big increase in earnings.
Daimler’s strong showing in 2013 has expectations high for significant growth not only by the Mercedes-Benz Cars but also by Daimler Trucks. “The company’s situation is good, but the future outlook is even better,” Zetsche said.
Zetsche added while the markets were uneven in the first three months of 2014, Daimler sold more cars, trucks, vans and buses in the first quarter of 2014 than in the prior-year period, he said.
Mercedes-Benz new records for unit sales in March as well as in the first three months of 2014 and was thus the world’s fastest-growing premium brand in the first quarter, Zetsche said.
The company will significantly increase its unit sales in full-year 2014 and will reach a new record figure, Zetsche predicted. Sales impetus will be provided by the high demand for the new S-Class, the new S-Class coupe, the new V-Class, the new C-Class family, the GLA compact SUV, and the new generation of the CLS and the CLS Shooting Brake, Zetsche said.
The smart brand will present the successor model of the smart for two and the new four-seater smart for four in July 2014, Zetsche told shareholders.
Strengthening the core business is not limited to the existing model series.
“We are also seeking to gain new customers by entering new segments for Mercedes-Benz,” explained Zetsche with regard to the first growth area. By 2020, it plans to introduce 12 completely new models that do not have any predecessors.
Another key to Daimler’s future growth is the development of new markets, particularly in China where Daimler has lagged behind the competition.
The expansion of Daimler’s activities in China, such as the development of the DENZA electric car with BYD, the doubling of production capacities by 2015 to approximately 200,000 cars and the expansion of the dealer network in China with 100 new dealerships set to open this year alone.
In the truck segment, there is a focus on India. The strategy there involves developing customized products based on proven Daimler technology and manufacturing them with a high level of local content.
Daimler also plans to emphasize technological leadership, which involves alternative drive systems as well as safety technologies as well as innovative business initiatives.
Zetsche said the key to more safety road traffic in intelligent vehicles and the safest form of driving is gradually becoming reality at Daimler: the autonomous automobile. With both cars and commercial vehicles, the focus is on active safety and thus accident prevention by means of various safety and assistance systems, he said.
(GM investing $449 million in electric vehicle facilities. For more, Click Here.)
“The products and technologies we benefit from today have their origins in strategic decisions made in the past,” Zetsche added. “After all, even though the pace of our business has accelerated, achieving success in the automotive industry requires a great deal of patience.”
Implementation of the new efficiency program at Mercedes-Benz Cars and “Daimler Trucks Number One” is also succeeding in reducing operating expenses.
(Click Here for details on Honda being named the Best Overall Brand.)
The car division aims to improve its cost position by approximately 2 billion euros by the end of 2014, of which 30% was to be achieved in the past financial year. With an improvement of 800 million euros, that target was surpassed. The goal for the trucks division is to implement measures that will result in improvements of 1.6 billion euros by the end of this year. As planned, 30% of that total was already achieved in 2013.
“The good times have only just begun. Our company can accomplish a great deal more,” Zetsche said.
(To see more about Toyota’s recall of 6.4 million vehicles worldwide, Click Here.)
Even Daimler’s often restless and critical shareholders also seemed impressed.
“Daimler woke up,” said the representative of one of the shareholders group, noting that Daimler’s share have increased by 70% in the past year while those of rival BMW have jumped 40% while the value of Volkswagen AG’s shares gained 30% in value.