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Old 5th February 2021, 14:54   #1
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Daimler to be renamed Mercedes-Benz; split truck & car units

Daimler AG will be renamed as Mercedes-Benz by the end of 2021. The company will also split its luxury car business and its truck unit into separate entities. The move is said to be the biggest shake-up since the sale of Chrysler almost 14 years ago.

Daimler to be renamed Mercedes-Benz; split truck & car units-teasermbretrofits.jpg

According to a media report, Daimler's truck unit could be worth about US$ 35 billion, but Deutsche Bank analysts estimate an even higher valuation.

The company plans to distribute a majority of Daimler Trucks to shareholders and the market seems to have responded positively to this news. Daimler shares rose by 8.9% to 64.56 euros on February 4, 2021.

The move is also said to have been perfectly timed as the transport and construction sectors have fully recovered in most markets.

Source: Bloomberg

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Old 5th February 2021, 16:32   #2
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Re: Daimler to be renamed Mercedes-Benz; split truck & car units

Are we seeing a pattern here?

Tata and Mahindra were also planning to split their PV business from CV. I guess that there are certain uncertainties and risks in at least the future of PV segment due to various branches and trends of mobility, technology and services. So, companies want to decentralize the risk which could potentially affect the whole business if they are single entity.
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Old 5th February 2021, 22:22   #3
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Re: Daimler to be renamed Mercedes-Benz; split truck & car units

Quote:
Originally Posted by saikarthik View Post
Are we seeing a pattern here?

Tata and Mahindra were also planning to split their PV business from CV. I guess that there are certain uncertainties and risks in at least the future of PV segment due to various branches and trends of mobility, technology and services. So, companies want to decentralize the risk which could potentially affect the whole business if they are single entity.
I think you're right. My immediate thought after reading this was the recent discussion about Tata spinning off it's passenger vehicle and commercial vehicle divisions away from each other into separate entities.

Forgive me for a rudimentary understanding of how the financials work in businesses like this but from what I understand the strength of the CV division often helps lessen the blow of losses or expenditure in the PV department (take Tata for example). By splitting it won't they run similar risk as well? Of course in this case Mercedes have healthy sales in most markets so I doubt it'll have much risk attached to this move.

Wonder if the trucks will continue to have the three-pointed star on the front post split?
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Old 5th February 2021, 22:30   #4
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Re: Daimler to be renamed Mercedes-Benz; split truck & car units

I am also not an expert on finance and can only guess. I think they will split the assets and cash reserves by historical data and projections with worst case scenarios in mind. So they will split in such a way that either can withstand a blow for at least a couple of years.

Regarding brand and logo, in my guess they will allow use of the Tristar on trucks and buses as well as cars. Take the case of Volvo cars and Volvo trucks, both use same logo even after selling cars business to a different group. In Daimler's case it will still be in the same group.

Last edited by saikarthik : 5th February 2021 at 22:31.
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Old 6th February 2021, 10:16   #5
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Re: Daimler to be renamed Mercedes-Benz; split truck & car units

So after the merge would the newer lorries be called as Mercedes-Benz & in case of the Indian lorries, would they continue to be called as Bharat Benz?
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