Rs 2,270-cr investment aimed at expanding product portfolio, upgrading technology, safety: Daimler India

Late last week, DICV said it would foray into the used trucks market thanks to a newly launched programme, Bharat Benz Exchange. The truck owners can opt for the exchange programme for new Bharat Benz trucks in exchange of their used ones. It also provides Daimler India with the opportunity to tap into the used trucks market. The timing, Daimler India says, couldn’t be better.

“Demand for MHCVs (medium and heavy commercial vehicles) continues to stay stressed due to COVID-19, and we believe that it is the right time to launch the Bharat Benz Exchange programme,” said Arya, “We are seeing traction in customers who want to buy used vehicles. The BS-VI launches have also increased the price-gap between new trucks and old commercial vehicles.”

Admitting that affordability of new trucks was at a low thanks to the prevailing COVID-driven slowdown, Arya said adding that the used trucks market in India was three times the size of the market for new trucks. “We hope to find good traction for Bharat Benz trucks even when it comes to used trucks,” he added. “We are targeting 10 percent of our present new trucks sales as volumes that we expect from the used trucks business.” At present, there are over a lakh Bharat Benz trucks, that are candidates for Daimler India’s new business vertical.

Arya said that DICV would also begin running two shifts this week onwards. In May, DICV reopened from the COVID-19 lockdown with just 30 percent of its workforce running a single-shift, in keeping with the Tamil Nadu government’s social-distancing stipulations in the wake of the pandemic and subsequent nationwide lockdown.

“Our plant has been operating with 100 percent workforce since July 2020 in a single shift. We are now adding an extra shift, with 100 percent workforce,” said Arya. The addition of the shift is significant since it could well mean green shoots in what has been a torrid year for the CV market.

“There are green shoots apparent in the CV business, but only in limited segments,” Arya said, adding, “We are seeing green shoots in construction thanks to the government’s infrastructure projects and we expect an uptick in truck sales to the mining segment from 2021 onwards.”

The company said it was seeing promise in the e-commerce segment too, which Arya believes is accounting for a significant chunk of discretionary spending amid continued work from home regulations, universally. However, the Daimler India boss held fast to his prediction that the MHCV market will see a 50 to 60 de-growth by the end of 2020.

“The MHCV market has already seen an 89 percent drop in sales,” said Arya. “I believe that the industry will end 2020 with sales 50 to 60 percent lower when compared to the previous year.”