Daimler Truck and Foton Launch Joint Truck Production in China

The joint venture between Daimler Truck and Foton, Beijing Foton Daimler Automotive Co. Ltd. (BFDA), will produce and distribute Mercedes-Benz trucks in China. The plant is a platform strategy of Daimler Trucks as a basis for new heavy trucks – produced in China for China. The planned production start at the new truck plant in Huairou is in two years.

(Stuttgart/Beijing) Daimler Truck AG and its Chinese partner Beiqi Foton Motor Co., Ltd. have jointly announced that they will produce Mercedes-Benz tractor units for the upper segment of the Chinese market. Based on Daimler Trucks’ global platform strategy, the joint venture Beijing Foton Daimler Automotive Co. Ltd. (BFDA) will produce new heavy tractor units in China for China and tailor them to the needs of Chinese customers. The vehicles will feature leading Daimler Trucks technology. The plan is to start building Mercedes-Benz trucks in a new BFDA truck plant in Huairou (Beijing) in two years. The joint venture is investing over 485 million euros (more than 3.8 billion RMB) in the purchase of the plant as well as the preparation of new infrastructure and production lines.

Continued Imports

To meet customer demands for premium vehicles for specific applications – e.g., concrete pumps for the rapidly growing construction sector – Daimler Trucks will continue to import vehicles from the Mercedes-Benz portfolio into China and distribute these trucks both through the existing dealer network and in direct wholesale business. The new heavy Mercedes-Benz tractor units for China benefit from Daimler Trucks’ global platform strategy. Among other things, they will be powered by an engine from Daimler Trucks’ global aggregate portfolio. The new Mercedes-Benz tractor units will be fully adapted to the specific requirements of different Chinese customers.

Start of Local Production in Two Years

Daimler Trucks and Foton plan to start local production in two years and will also build a local supply landscape in the coming years. Details about the products and their market launch will be announced at a later date. “For us at Daimler Trucks, it is a strategic goal to be globally leading and to create added value for our customers worldwide. As the largest truck market in the world, China is of central importance to us and has become one of the most important markets for future growth. To fully exploit this potential, we have decided to produce heavy Mercedes-Benz tractor units in China for China,” says Martin Daum, Chairman of the Board of Daimler Truck AG. “We are convinced that we are announcing the right strategic step for the right market at exactly the right time today.”

Growing with China in China

Hubertus Troska, Member of the Board of Daimler AG, responsible for all China activities: “Our goal is to grow in China and with China. This applies to our passenger car business as well as our commercial vehicle business. The Chinese truck market is undergoing change, especially in the field of long-distance transport. The growing e-commerce and logistics market offers many opportunities for us. We believe in the further growth potential of the truck market in China and are determined to contribute to its long-term development. Today is not only an important milestone for Daimler’s localization strategy but also an excellent example of Chinese-German cooperation.”

Tractor Units for the Upper Market Segment

Sven Ennerst, Member of the Board of Daimler Truck AG, responsible for development, purchasing, and the China region: “By locally producing Mercedes-Benz tractor units for the growing upper market segment, we are bringing our product platform for heavy trucks to the Chinese market and perfectly adapting it to the needs of our Chinese customers. We equip the vehicles with our leading Daimler Trucks technology. This clearly underscores our long-term commitment to the Chinese market. Together with Foton, we will consistently and purposefully expand our presence in China.”

Further Development of Cooperation

Gong Yueqiong, Chairman of Beiqi Foton Motor: “With the establishment of Beijing Foton Daimler Automotive Co. Ltd. (BFDA), Foton and Daimler took a historic step on February 18, 2012. The recent project to localize a heavy Mercedes-Benz truck is a further development of the cooperation between Foton and Daimler and the right strategic step in an evolving Chinese market. Tailored to Chinese needs, the localized Mercedes-Benz truck is based on the latest global platform of Mercedes-Benz trucks and benefits from the leading technology of Daimler Trucks. The project will help to further develop BFDA’s truck portfolio and offer Chinese customers a wider range of products and solutions.” The Chinese market for heavy trucks had a volume of 1.1 million units in 2019. For 2020, it can be assumed that more than half of the trucks sold worldwide will be registered in China. China is an important part of Daimler Trucks’ global platform strategy. By locally producing Mercedes-Benz and Auman trucks in China, the company will better leverage the potential of the world’s largest truck market in the future and expects that sales in China will increasingly contribute to the global sales development of Daimler Trucks.

The Mercedes-Benz and Auman Brands in the Chinese Market

Daimler Trucks pursues two strategic pillars in the Chinese market. On the one hand, Daimler Trucks sells imported Mercedes-Benz trucks in China and is one of the market leaders in the import business for heavy trucks – the vast majority of sold trucks are intended for specific applications, such as concrete pumps. On the other hand, BFDA targets the price-sensitive market segment with locally produced Auman trucks in China. With the production of heavy Mercedes-Benz tractor units, BFDA will substantially complement the local portfolio and target another customer segment in the Chinese market that is currently developing very rapidly: the upper segment for technologically advanced trucks. The locally produced vehicles will be equipped with leading Daimler Truck technology tailored to customer needs in the upper segment – for example, fuel efficiency, reliability, state-of-the-art safety systems, as well as total cost of ownership (TCO) and durability.

About Beijing Foton Daimler Automotive Co., Ltd.

BFDA is a joint venture of Daimler Truck AG and the Chinese manufacturer Foton Motor, with both companies holding a 50 percent stake. In Q1-Q3 2020, BFDA sold 99,550 units – an increase of around 60 percent compared to the previous year. Photo: © Daimler Truck / Image caption: The new truck plant of Beijing Foton Daimler Automotive (BFDA) in Huairou, Beijing. This plant will produce Mercedes-Benz trucks in China for China in the future. www.daimler-truck.com     www.foton-global.com