The economy rebounded in all of the key markets worldwide in the first half of 2010, leading to a growing demand for consumer goods and therefore to an increase in transport volume. In line with these developments, the demand for vans also recovered substantially in many of the core markets.
Mercedes-Benz Vans has greatly benefited from this development, raising sales to over 106,000 vehicles in the first six months of the year, an increase of more than 50% over the same period of 2009. This increase was mainly due to the rapidly growing economies in Latin America (sales up by 51% to approximately 6,000 vans) and the most important sales market of Mercedes-Benz Vans, Western Europe (sales up by 39% to 76,200 vehicles). Higher sales in France, the UK, Italy, Spain, and the Netherlands contributed especially to this growth. Sales in Germany were up slightly to 28,700 units (+12%). The Vans unit also recorded strong sales growth in Eastern Europe, where the results improved by 26% to 6,700 units. In the NAFTA region, the new sales organization of Mercedes-Benz Vans in the U.S. and Canada got off to a resounding start, boosting sales to 5,200 units (January-June 2009: 300 units).
Revenues rose by 33% in the first half of 2010, to €3,674 million. EBIT grew substantially from minus €101 million in the first half of 2009 to €191 million between January and June of this year. This improvement in earnings was primarily the result of higher sales compared to the previous year, particularly in Western Europe. Thanks to a return on sales of 5.2% in the first half of the year, Mercedes-Benz Vans is among the leaders in profitability in the vans sector.
Volker Mornhinweg, Head of Mercedes-Benz Vans, talked today in Stuttgart about the business development of Mercedes-Benz Vans in the first half of 2010 and the strategy of the division. Commenting on the results, Mornhinweg said: “We really took off in the first six months of 2010 and are now clearly back on track. Our results for the key financial figures of sales, earnings and return on sales speak for themselves, particularly after the difficult situation we faced in 2009. Our current market share of 17.4% makes us the clear market leader in the segment for mid-size and full-size vans in the European Union. And we’re continuing the offensive by launching the right products on the market at the right time and moving forward with our global growth strategy.”
Numerous measures implemented for safeguarding the long-term future of Mercedes-Benz Vans
The success of Mercedes-Benz Vans is due to a long-term strategy which encompasses the three core objectives “Growth in Existing Markets,” “Growth in New Markets,” and “Technological Leadership.”
In order to generate additional growth in existing markets, Mercedes-Benz Vans is increasing its investment in the successor generations of the current product range and in sales and service activities. Furthermore measures for ensuring compliance with global environmental legislation are top priority. Even in economically challenging times, Mercedes-Benz Vans continued to invest heavily in safeguarding its long-term future. In the past three years the unit has spent €250 million on developing the new generations of the high-quality Mercedes-Benz Viano and Vito, as well as on expanding the production facility in Vitoria, Spain, which manufactures both models. The Vito for commercial use features a higher payload and is very robust, while the Viano sets the standards for safety, comfort, and driving pleasure in full-size vehicles. The models are also equipped with economical, fuel-efficient, and environmentally friendly engines with BlueEFFICIENCY technology. Both of the vehicles will make their public debut at the IAA Commercial Vehicles show in September.
The strategic alliance with Renault-Nissan will also help the unit achieve further growth in Europe. In the light commercial vehicle segment, the collaboration concluded between Daimler and Renault-Nissan in April 2010 envisions adding a completely new city delivery van for commercial customers to the Mercedes-Benz Vans product range in 2012.
In North America, Mercedes-Benz Vans is starting a sales campaign with a new sales organization in the U.S. and Canada and a focus on a two-brand strategy. In addition to being sold with the Freightliner nameplate as in the past, the Sprinter has also been sold as a Mercedes-Benz vehicle in the U.S. since the beginning of the year in order to provide customers with the best service possible. The number of dealers will increase from 120 in January 2010 to around 200 in 2011.
Latin America is another established market for Mercedes-Benz Vans. Mercedes-Benz has been successfully producing vans for the South American market in Argentina for more than 50 years. With a market share of 40%, Mercedes-Benz is by far the best-selling premium automaker in Argentina. It occupies a strong position in Brazil as well, with a market share of more than 16%.
Clear strategy for activities in growth markets
Along with the growth it achieves in its established markets, Mercedes-Benz Vans is also looking to profit from the growth potential in emerging markets. Volker Mornhinweg believes there will be promising growth opportunities in Asia over the short and medium terms. “In line with the slogan ‘Go East,’ we are the first automaker to manufacture vans in China, the most dynamic growth market of all,” he says. “Our vans have been rolling off the assembly line there since April — but that’s not all. We’ve also been building vans for the Asian market in Vietnam for the past 15 years.”
In April 2007 Mercedes-Benz Vans joined up with Fujian Motors Group to establish the first joint venture for building vans in China. The 50:50 joint venture, called Fujian Daimler Automotive (FDJA), has already sold more than 3,000 Vito and Viano vans produced locally in China since the start of production in April 2010. Also the Sprinter as a mini-bus version will be produced locally within this important growth market, starting from 2011.
Russia also offers promising growth opportunities for the vans business. Here, the market volume for mid-size and full-size vans in 2009 was 87,000 units. According to current forecasts, that figure could rise to 300,000 vans as early as 2020. Mercedes-Benz Vans is examining a range of options for efficiently penetrating the Russian market in the near future.
Mercedes-Benz is clearly the market leader in “green technologies”
The strategic approach of Mercedes-Benz Vans clearly includes the penetration of new growth areas such as the development of environmentally friendly technologies and safety-oriented technologies. In the area of the so-called “green technologies,” Mercedes-Benz Vans is the leader in the segment of mid-size and full-size vans.
This July, the unit presented the first electricmotive-powered van, the Mercedes-Benz Vito E-CELL, which is extremely quiet and generates absolutely no emissions during operation. A small-batch series of 100 units of the new Vito E-CELL is currently in production, and testing by customers has commenced. Starting in 2011, 2,000 additional Vito E-CELL vehicles will follow.
Outlook
Against the background of increasing demand and the recovery of the market in the van business, Mercedes-Benz Vans expects to sell considerably more vehicles this year than in 2009. When asked about the unit’s medium-term business target, Volker Mornhinweg had this to say: “Our goal is to be as successful worldwide in the medium term as we are now in Europe. For this reason we will continue to consistently implement our strategy and continuously invest in the future of the unit, starting with our products and continuing with our production locations and, of course, our most important capital — our employees.”
