Mercedes 2012 Annual Report Download - page 81

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Ambitious return targets. In addition to our growth targets,
we have we set ourselves a return target of 9% on average for
the automotive business, which we intend to achieve on a sus-
tained basis. This overall target is based on return targets for
the individual divisions of 10% for Mercedes-Benz Cars, 8% for
Daimler Trucks, 9% for Mercedes-Benz Vans and 6% for Daimler
Buses. Our target for the Daimler Financial Services division is
a return on equity of 17%.
Portfolio changes and strategic cooperations. By means
of targeted investment and future-oriented partnerships, we
strengthened our core business, pushed forward with new
technologies and utilized additional growth potential in 2012.
At the same time, we focused on the continuous further
development of our existing business portfolio.
In February 2012, Daimler and Chinese partner Beiqi Foton
Motor Co., Ltd. received the business license for the Beijing
Foton Daimler Automotive Co., Ltd. (BFDA) joint venture.
Through BFDA, Daimler’s truck division will participate in the
Chinese market for medium and heavy trucks. Foton is con-
tributing its existing business with medium and heavy trucks of
the Auman brand, production facilities and the sales and ser-
vice network. The joint venture will also benefit from Foton’s
knowledge of markets in China and the whole of Asia. This will
enable BFDA to push forward faster with the development of
business in the entire region. The first jointly produced truck
under the Auman brand already rolled off the assembly line in
the third quarter of 2012. Furthermore, BFDA plans to set up
an engine plant.
In April 2012, the antitrust authorities approved the acquisition
by AKKA Technologies S.A. of a stake in MBtech Group.
As already agreed in December 2011, AKKA Technologies was
then able to buy a 65% interest in MBtech Group, which was
previously wholly owned by Daimler. An agreement on this trans-
action was signed by Daimler and AKKA Technologies on
December 7, 2011. With an interest of 35%, Daimler remains
a long-term and strategic shareholder as well as an important
client of MBtech. AKKA Technologies’ entry at MBtech has
created one of the biggest European engineering consultancies
for the automotive, aerospace, transport and energy indus-
tries.
In September 2012, Daimler and Renault-Nissan confirmed
that the German-French-Japanese partnership now includes
two additional shared projects in the field of fuel-efficient drive
systems. In one of the projects, the two companies are jointly
developing a new family of four-cylinder gasoline engines.
These turbo engines with direct fuel injection will offer the latest
technology in a compact form. The goal is to significantly
reduce fuel consumption combined with even lower emissions.
The new engines are to be produced jointly and will be used in
Daimler and Renault-Nissan vehicles as of the year 2016. In the
other project, Daimler will grant Nissan a license to produce
automatic transmissions incorporating the latest technology
for Nissan and Infiniti vehicles as of 2016. The Nissan subsid-
iary Jatco plans to produce these new transmissions in Mexico.
Already in January 2012, it was announced that Daimler and
Nissan intend to jointly produce Mercedes-Benz four-cylinder
gasoline engines at Nissan’s powertrain plant in Decherd,
Tennessee. Production will start in 2014. The engines will be
used in both Mercedes-Benz and Infiniti models.
In December 2012, Daimler AG reduced its equity interest
in the European Aeronautic Defence and Space Company
(EADS) in economic terms from 14.9% to 7.5%. The sale of
61.1 million EADS shares resulted in proceeds of €1.7 billion,
which had a corresponding positive impact on our free cash
flow. Those proceeds will be used for the global growth of our
divisions, for our products, and to strengthen our technolo-
gically leading position. The reduction of our equity interest in
EADS took place in the context of optimizing the company’s
shareholder structure: State influence is now limited to 30%.
In this context, the other private-sector shareholders in the
Dedalus investor consortium also sold their EADS shares, while
the public-sector Dedalus investors continue to hold their
shares. The voting rights of the Dedalus consortium are to be
exercised by Daimler until the extraordinary shareholders’
meeting of EADS on March 27, 2013. As part of the focus
on our core business of producing motor vehicles and provid-
ing mobility services, we generally intend to further reduce
our interest in EADS. No decision has yet been made on when
or how that will occur.
Also in December 2012, Daimler established a new, integrated
car distribution company in China, thus taking an important
step in the implementation of our growth strategy. Beijing
Mercedes-Benz Sales Service Co., Ltd. is a 50:50 joint venture
with our strategic partner Beijing Automotive Group (BAIC).
The new company combines the functions of sales and market-
ing, aftersales, dealer network development, used-car and
fleet-car sales, and dealer and workshop training for Mercedes-
Benz cars in China in an integrated organization. Previously,
there were two separate sales channels: one for imported and
one for locally produced vehicles. Already in mid-2012, Daimler
had also increased its interest in the import company, Mercedes-
Benz (China) Ltd., from 51% to 75% – an important step on
the way to an integrated distribution company.
New Board of Management position for “Greater China”
On December 12, 2012, the Supervisory Board of Daimler AG
decided to create a new Board of Management position for
“Greater China”. It includes the function of CEO and Chairman
of Daimler Northeast Asia as well as responsibility for all
of Daimler’s strategic and operating activities in China.
This decision underscores the strategic importance of China
for Daimler. We see considerable further potential there
for sustainable growth and the continuous expansion of our
business activities.