Upsurge in sales for Daimler AG

Daimler AG, the automotive behemoth based in Germany, has seen released figures for the quarter that show an upsurge in demand for Mercedes trucks, with the current relative weakness of the Euro driving higher exports. The operating profit for the second quarter was reported to be €2.1 billion, which represents a remarkable turn around from the same time last year, which showed a $1 billion loss. The difference in sales revenues between this quarter, and the same quarter last year was €5.5 billion, with the revenues being €25.1 billion and €19.6 billion respectively. The majority of the profits were form the Mercedes cars division, with Benz trucks also performing strongly.

The auto division recorded sales of €14 billion, with many sales occurring in China and the United States. Auto analyst Juergen Pieper also highlighted, an advantageous product mix as well as better price penetration and positive exchange effects as the euro declined in value against other major currencies. Pieper, who works Metzler Bank, also said, A lot of positive things are coming together. It is almost a boom in premium cars this year, double-digit growth for these products. We had very positive comments from BMW this week and we have the same now from Daimler, he noted, with makers of high-end cars almost back at levels of profitability seen before the global economic crisis.

Daimler also implemented a variety of cost cutting measures in its truck division, which is the largest producer of heavy vehicles in the world. The full second quarter results are to be published on the 27th of July, and BHF Bankk analyst Aleksej Wunrau said, We can expect a very nice upward rrevision, before adding that his own predictions had been surpassed by 10 to 15 percent.

It has also been announced that Daimler are to embark upon a joint venture with Foton Motor in China. The growth of the market in China, now the world's largest, is huge. The trends also look good for Daimler, with Pieper noting, Especially in Asia, we are coming back to a trend towards bigger cars and bigger engines.

Sisu and Daimler AG enter joint venture

2011 will see a joint venture between Daimler AG and Sisu, with components for Mercedes benz trucks being shipped to Karjaa in Finland, where Oy Sisu Auto Ab. is based. Sisu will provide axles, frames and drive-shafts, whilst the cabs, transmissions and engines will be supplied by Daimler, form the Mercedes-Benz Actros range, and the volume is projected to be between 200 and 400 vehicles a year, contingent upon the results of a 'feasibility study'. At present the Sisu range of commercial vehicles is based upon the Premium cab by Renault, but at the moment it is speculation as to whether this range will continue, or be phased out. Similarly, the engines in Sisu vehicles are currently manufactured by Caterpillar, but whether that will be continued in tandem with the new Actros-based range is, at this juncture, mysterious. A press release stated that the trucks will marketed and sold by the Sisu brand, and that the feasibility study will be complete by the end of 2010.

Hubertus Troska, head of Mercedes-Benz trucks, has said:

We are delighted that Sisu has selected us as a supplier of high-quality components. Sisu is a traditional brand known for first class trucks. Once the feasibility study has been successfully concluded, we will be able to open up a new area of business and generate additional sales potential for our vehicle components.

The press release went further, stating:

The vehicles will be sold via the Veho Commercial Vehicles sales network in Finland. The Veho Group Oy Ab. has been importing Mercedes-Benz passenger cars and commercial vehicles since 1939 and also sells the Fuso Canter and Setra buses in Finland. The market for medium-and heavy-duty trucks in Finland encompassed about 2,600 units in the crisis year of 2009 (approx. 3,500 trucks are sold in a normal year). There were around 390 new Mercedes Benz trucks delivered, giving thee brand a market share of 15%. Following the conclusion of the feasibility study, the future delivery of all key components to the independent truck manufacturer Sisu will particularly benefit the VEHO Group Oy's workshop network, as VEHO Group Oy also maintains and repairs SISU vehicles in its role as general representative for Mercedes Benz commercial vehicles. In addition, it is expected that Mercedes-Benz's share of this Scandinavian truck market would increase.