Daimler studying opportunities in defence and off highway biz

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Chennai: Daimler India Commercial Vehicle, the 100 per cent subsidiary of Stuttgart-based Daimler, is studying opportunities on entering defence and making engines in the offroad highway segment, a top official has said.

The company currently has presence in commercial vehicle and buses segment under Daimler India Commercial Vehicle and Daimler Buses India, respectively.

DICV CEO Satyakam Arya said the company was also ‘talking to some players’ on entering the freight aggregator segment.

On company’s future plans, he said there were two approaches one currently studying to enter segments like defence and the other was making off highway engines.

“The second is more progressive for future-oriented approach. There, we will use our culture of innovation, find new business ideas and revenue streams,” he told reporters.

Elaborating, he said, for example the company is eyeing the “freight aggregation” space to check whether it makes sense to enter.

“We believe that it is a fast growing segment and big enabler for us to penetrate into the market”, he added.

On the company’s performance in 2019, DICV’s wholsale business went down by 36 per cent while retail fell by 29 per cent.

In 2019, the company expanded its footprint in the country by adding 54 touchpoints in 2019, he said. “For 2020, we plan to add another 25 per cent of retail expansion…”

On exports, Arya said the company recorded 14 per cent growth shipping 8,000 trucks to 53 markets.

Later responding to a query on how the company was planning to enter off highway engines space, he said, “we are looking at the opportunities. We have two series of engines which locally produce in India.”

“Six cylinder and four cylinder engines. Both of these are fitting very well to off highway sector. So we have started studying…,” he said.

The company has commenced interactions with customers in the process of feasibility, he said.

On plans to enter defence business, he said the company also started studying the requirements from defence side when it comes to vehicles.

“We need a four by four truck mostly. We have started now a study on developing that four by four,” he added.

However, the company was aware that it has to cross one step on whether government of India was changing the regulation as current norm in defence is that companies headquartered outside India cannot supply to defence segment.

“They (Government of India) have also indicated that they are going to change this. And have indicated that by April they will give a relaxation on the norms,” he said.

“We are closely looking at that and when that happens we will start developing…,” he said.

To a query, Arya said Daimler as a group was present in many parts of the world in terms of supplying off highway engines and also in defence.

“We have the technology here…,” he said.

He acknowledged the foray into new business was to address the cyclicality in the commercial vehicle business.

“The commercial vehicle is anyway a cyclical business.

We definitely are looking for ways to mitigate this and also to look for new revenue streams…,” he said.

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