Daimler Truck defence unit targets €1bn in revenues by 2028

Commercial vehicle maker Daimler Truck is stepping up its defence activities by consolidating its global operations under the new umbrella brand Daimler Truck Defence and is aiming for €1 billion ($1.16 billion) in global revenues by 2028, the company near Stuttgart said on Monday.

Daimler Truck, in a press release, said its investment plans in the sector are in the range of "mid-three-digit million-euro amount."

Last year, revenue in the defence sector amounted to a mid-triple-digit million figure, Daimler Truck Defence chief Dennis Kinzelmann told dpa. Military vehicles currently account for a low single-digit percentage of unit sales. The vast majority of vehicles sold are therefore classic lorries and buses.

Team at Wörth site set to grow

As part of the strategic expansion, Daimler Truck will also extend its development, production, sales and service capacities over the coming years, the statement said. Around 1,000 people currently work in this area. The growth strategy is being shaped largely at the Wörth am Rhein site in the German state of Rhineland-Palatinate, near Karlsruhe, and will lead to more than 100 new jobs for qualified specialists, the company said.

In future, the portfolio is to include not only vehicles from Mercedes-Benz Trucks. The Dax-listed group has brands besides Mercedes-Benz, including Western Star in North America and BharatBenz in India.

Daimler Truck Defence draws on technology from the group's modular system of civilian model series and also cooperates with partner companies.

"Given the increased demand, we have had and still have a very good starting position," Kinzelmann said. "We are drawing on products that have already proven themselves." Model series such as Unimog and Arocs have been used for many years for non-military applications.

Commercial vehicle maker under pressure

The commercial vehicle maker's profit slumped 34% year-on-year last year to €2 billion. US tariffs and weak demand in North America weighed heavily on the business. Revenue and unit sales also declined. In the first quarter of this year, profit even collapsed by 80%. To become more competitive, Daimler Truck launched the Cost Down Europe savings programme last year.