Daimler to split into Mercedes-Benz and Daimler Truck as independent companies

Until now, Daimler AG has operated under a single umbrella with three divisions: Mercedes-Benz (focused on cars and light commercial vehicles), Daimler Truck, and Daimler Mobility.

That is set to change in what amounts to a major rebuild of the German manufacturer. The group will be separated into two standalone companies: Mercedes-Benz, covering passenger cars and commercial vehicles, and Daimler Truck, responsible for lorries and buses.

As for Daimler Mobility-currently handling finance-related activities (such as funding arrangements and leasing) as well as mobility services-its resources and teams will be split between the two new businesses.

Why change?

In the statement announcing this far-reaching shift, Daimler said it is planning “a fundamental change in its structure, designed to unleash the full potential of its businesses”.

Commenting on the split, Ola Källenius, Chairman of the Board of Management of Daimler and Mercedes-Benz, said: “This is a historic moment for Daimler. It marks the beginning of a profound reshaping of the company”.

He added: “Mercedes-Benz Cars & Vans and Daimler Trucks & Buses are different businesses with specific customer groups, technology paths and capital needs. Both (…) operate in sectors that are going through major technological and structural change. In that context, we believe they will be able to operate more effectively as independent entities (…) free from the constraints of a conglomerate structure”.

Daimler Truck will be listed on the stock market

As you may have gathered, the separation has the biggest impact on Daimler Truck, which-once the process is complete-will need to operate on its own.

To that end, it will have fully independent management (including a Chairman of the Supervisory Board) and is expected to be publicly listed, with an IPO on the Frankfurt Stock Exchange planned for before the end of 2021.

For the new heavy goods and passenger-vehicle company, the aim is to speed up “the execution of its strategic plans, increase profitability and drive forward the development of emission-free technologies for lorries and buses”.

More news will only come in a few months

Finally, still on the subject of the split, Ola Källenius stated: “We are confident in the financial and operational strength of our two vehicle divisions. We are convinced that independent management and governance will enable them to operate even faster, invest more ambitiously, pursue growth and cooperation and thus be significantly more agile and competitive”.

According to Daimler, further details on the separation will be shared in the third quarter of the year at an extraordinary shareholders’ meeting. Until then, one point has already been confirmed: in due course (the precise timing is not yet known), Daimler will change its name to Mercedes-Benz.