Daimler AG on Feb. 3 announced plans to spin off its truck and bus division as a separate publicly traded company by the end of 2021: Daimler would rename itself Mercedes-Benz, continue as a car and van maker, and own a sizable share of the stock of the newly independent Daimler Truck. The two companies would not be competitors but would remain in some sort of joint venture. The plan is supported by the German union IG Metall.
The restructuring isn’t expected to impact operations, and could protect the company from a hostile takeover by Chinese investor Li Shufu, who together with his company Geely holds about 10% of Daimler AG stock. The move is also in line with the trend by companies toward a “pure play” strategy, in which each publicly-traded company focuses on just one line of business, so that its stock performance correlates closely with the performance of its particular sector. The Daimler move follows a similar decision by Volkswagen to spin off its truck business, Traton, in 2019.
The split is also a recognition that car and truck production will diverge as both move to electric. Cars and vans will shift to battery drives, while trucks and buses will use fuel cells.
Further details will be presented to shareholders at a special meeting this summer.
Daimler Truck is the world’s largest truck and bus producer, with more than 100,000 employees at over 35 locations around the globe, including its union-represented truck plant in Portland. It makes trucks and buses under seven brands: BharatBenz, Freightliner, Fuso, Mercedes-Benz, Setra, Thomas Built and Western Star.