Daimler Trucks Infuses Rs 2,277 Crore in India, to Quickly Bounce Back in Demand in 2021
Satyakam Arya, MD of Daimler India Commercial Vehicle told ET there are some green shoots emerging, and thanks to good preparation for BS-VI, there is growing traction for Bharat Benz trucks compelling the company to start the second shift shortly.
Daimler Trucks, the world's largest commercial vehicle maker has committed an additional Rs. 2,277 crore in the Indian market with a hope of a quick bounce back in demand in 2021.
The maker of Bharat Benz expects the light to the heavy truck market to grow by 30-50% in 2021.
But this bounce back in growth will be on a very low base of 2020, where Bharat Benz expects the market to slip by 50-60% this year.
To be sure, from January to June, the market has already nosedived 74% and this after 25-30% decline in 2019. Know more about 4 Reasons Why Fleet Maintenance is Important for Heavy Duty Trucks?
Listen to what Satyakam Arya, (MD of Daimler) has to Say:
"There is a solid order pipeline for our trucks and hence we are adding the second shift. There is decent traction from the mining segment, construction space, e-commerce, and rural segment. The government has started executing fresh contracts, which is triggering demand for new trucks. We are witnessing industrial activity picking up. Having said that this recovery is on a low base," added Arya.
Arya said the company has worked overtime to reduce the break-even levels and it is trying to generate new ways of adding to the top line by securing new exports market for parts, aggregates, or fully built products. The company has also started a new services division called Daimler India Shared Services, which can essentially help any of their global subsidiary in setting up of a greenfield facility, engineering, manufacturing, led by a strong software and services base from India. On Friday, the company started the used truck division - called Bharat Benz Exchange. Read more about the Benefits of Autonomous Trucking in Fleet Management
Initiatives for Expanding Revenue Stream for Daimler:
The investment from Daimler India will go towards the expansion of the product portfolio, which is being developed keeping in mind global markets too. The new range of products is being created to account for stringent future emission norms, safety, comfort catering to varied market needs globally.
While there is a fresh infusion from the company in the Indian subsidiary, the spending is being carefully prioritized given the cash flow challenges the business faces today. The top management did take a voluntary pay cut in 2020 but ensured the rest of the workforce remunerations were untouched despite a steep decline. All these new initiatives are aimed at adding a new revenue stream for the company and its channel partners. Don't forget to read the Check List for Fleet Maintenance & Effective Truck Maintenance Over Time
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