Daimler's Dieter Zetsche said that the company would be growing its services businesses.
Daimler AG has signed an agreement to acquire its Athlon Car Lease International unit for $1.2 billion as it moves to push deeper in the service sector that the German automaker’s top management believes is the next frontier for car companies across the globe.
During the past couple of years, Dieter Zetsche, Daimler’s chief executive officer, has highlighted services as a growth opportunity for German automaker and now that’s moving from rhetoric to reality.
Both companies said the deal was subject to the necessary regulatory approvals and was expected closed in the fourth calendar quarter of 2016. The acquisition will significantly increase the scope of Daimler’s fleet-management business, according to Bodo Uebber, the company’s chief financial officer.
“Fleet management is a growth market and this acquisition of a strongly positioned and innovative fleet management company is a key step for us in becoming a leading fleet management services provider. It also allows us to enhance fleets with Daimler’s products and mobility offers,” Uebber said in a statement.
The move mirrors the efforts by automakers around the globe to expand their revenue generators by targeting “mobility.” General Motors and Ford Motor Co. have been broadening their business base by acquiring portions of ridesharing companies, like Lyft, as well as carsharing companies hoping to take advantage of growing segments.
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Daimler’s move represents another approach to capturing a chunk of the growing “mobility” market, where one of its rivals, BMW, has been making inroads. BMW’s multi-brand fleet management and leasing businesses, which manages more than 600,000 vehicles. It closed a deal last year to double its fleet management business.
“Today, fleet customers do expect a flexible management of their mobility needs across brands around their fleets. Rental, leasing, corporate carsharing and comprehensive reporting are key elements of our fleet management value proposition”, stated Klaus Entenmann, chairman of Daimler Financial Services AG.
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The company targeted by Daimler, Netherlands-based De Lage Landen, is a subsidiary of Rabobank. Athlon manages a fleet of a total of 250,000 cars.
Daimler Fleet Management GmbH provides fleet management for passenger cars and vans and manages about 85,000 vehicles and currently operates in 13 countries across Europe, including Austria, Belgium, Czech Republic, France, Germany, Great Britain, Holland, Italy, Luxembourg, Poland, Spain, Sweden and Switzerland.
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The German premium carmaker wants Athlon to continue operating under its brand name. Athlon Chief Executive Frans Janssen said “the merging of Athlon and Daimler, two strong innovative brands, will positively contribute to our customers’ ability to access an extended product and service range across Europe.”