To support and optimize its existing strategy, DaimlerChrysler has developed the “Global Excellence” program for its Commercial Vehicles division. The program focuses on short, medium and long-term goals primarily aimed at increasing efficiency and exploiting economies of scale. The Global Excellence program consists of four initiatives: The optimization of the business model, the creation of synergy effects and economies of scale, further growth in the global commercial vehicle markets and the development of future product generations. The first initiative - “Optimization of the Business Model” - is designed to lessen the impact of the cyclical developments typically experienced by the sector, thus ensuring the division’s long-term profitability.

In 2004, the Commercial Vehicles division posted record global sales of more than 712,000 trucks, vans and buses (+42 % on the figure for 2003). Even if the Mitsubishi Fuso business unit (which was consolidated in March 2004) is not included in the results, sales increased to over 594,000 vehicles (+19 %). The generally favorable economic situation and a strong boost from global markets helped make this sales result possible. In fact, more heavy-duty trucks were produced around the world in 2004 than ever before.

And the positive development continued into the first quarter of 2005, when sales relative to the first quarter of 2004 grew by 43 % to 179,500 vehicles, while revenues increased by 32 % to € 8.7 billion (Q1 2004: € 6.6 billion).

The commercial vehicle sector is subject to particularly strong cycles due to the specific use of the vehicles for business purposes, the life-cycles of vehicle fleets, exchange rate effects, the development of the global economy and emissions legislation. “Our aim is to keep the di-vision profitable in the future regardless of market developments. To do so, we will continue to pursue our ‘profit margins instead of sales volume’ policy,” says Andreas Renschler, the DaimlerChrysler Board of Management member responsible for the Commercial Vehicles Division. “That is why one of our main short and medium-term tasks focuses on an initiative aimed at optimizing the business model.”

The second initiative - “Operational Excellence” - concentrates on the rigorous reduction of material expenses and fixed costs, as well as on the optimization of global processes and the increased flexibility of production plants. As the world’s largest commercial vehicle manufacturer with approximately 115,000 employees at 60 locations, DaimlerChrysler is intensifying its efforts to generate further synergy effects and economies of scale. In particular, it plans to increasingly network its business units and further embed its products in an intelligent component-sharing strategy. For example, future truck generations will not only be equipped with a common heavy-duty engine platform, but also with a common electrical and electronic architecture and standardized axle components.

As part of the third initiative - theglobal growth strategy - the Commercial Vehicles Division will also integrate the Japanese business unit Mitsubishi Fuso Truck and Bus Corporation (MFTBC) more strongly into the division as a major component of its Asian strategy. Following the acquisition of a majority holding in MFTBC, DaimlerChrysler discovered that the Japanese manufacturer suffered from a number of quality issues extending back to the 1970s. The resulting sales decreases in Japan were offset in 2004 by strong growth in Southeast Asia, Europe and the Middle East. DaimlerChrysler has identified all past quality issues at MFTBC and implemented the requisite technical solutions.

At the end of June, Harald Bölstler will succeed Wilfried Porth as head of Mitsubishi Fuso. “This step will mark the beginning of a new era in which Mitsubishi Fuso will be more strongly integrated into DaimlerChrysler’s Commercial Vehicles Division and can thus fully concentrate on future challenges,” says Renschler. “The quality offensive got off to a very successful start under Wilfried Porth. The second phase, in which we will actively shape the business unit's future, will now be launched by Harald Bölstler. In other words, Mitsubishi Fuso is, and will remain, the most important pillar of our Asia strategy.”

The strategic goal of the fourth “Global Excellence” initiative is to promote innovation and create future product generations with a heightened appeal. In this way, DaimlerChrysler Commercial Vehicles will be underscoring its leadership in the fields of safety concepts and new technologies. In its efforts to realize its vision of “accident-free driving,” the Commercial Vehicles Division has been developing new assistance systems for more than 25 years. These systems are primarily designed to increase drivers' control over their trucks in traffic and thus improve safety. DaimlerChrysler enjoys a long history as a leader in the area of active safety systems. One example of its development achievements is the Telligent emergency braking system, which will help to considerably reduce the number and severity of rear-end collisions once it is introduced in spring 2006. The Group’s other commercial vehicle brands benefit from such technical innovations as well.

Another technological focus at DaimlerChrysler is the development of alternative drive systems such as natural-gas and fuel-cell technologies. In addition, the company is playing a pioneering role in the development of hybrid drives for buses, trucks and vans. Current examples of such developments are the low-floor Orion VII HybriDrive bus and the Mitsubishi Canter Hybrid. In 2003 and 2004, the New York public transport authority ordered more than 325 Orion VII HybriDrive buses.

Mercedes-Benz has been successfully launching trucks equipped with the new BlueTec diesel technology on the market since February 2005. These vehicles already comply with the Euro 4 and Euro 5 emissions standards, even though these limits won’t go into effect until 2006 and the fall of 2009, respectively. More than 4,800 BlueTec vehicles have been sold to date, representing a 70 % penetration rate for the respective markets and products. In concrete terms, this means that particulate emissions from vehicles equipped with BlueTec diesel technology are at least 80 % lower than the levels defined by current limits and nitrogen oxides up to 60 % lower. In terms of particulate matter in the exhaust, the filter efficiency of the new BlueTec drive systems is 80 % better than the level defined by the Euro 3 standard. By combining SCR catalytic converters with state-of-the-art engine technology it is even possible to filter out some of the finest particulates. DaimlerChrysler is currently working intensely to develop appropriate solutions that will enable particulate filters to be retrofitted in existing vehicles.