Michael Dietz: steering Daimler Trucks & Buses through 2020’s challenging waters

Michael Dietz: steering Daimler Trucks & Buses through 2020’s challenging waters

This has been a  challenging year for the transport industry – both here in South Africa and all over the world. However, as CHARLEEN CLARKE discovers in this exclusive interview with Michael Dietz, CEO of Daimler Trucks & Buses Southern Africa (DTBSA), it’s ending surprisingly well for the manufacturer and distributor of Mercedes-Benz and Fuso commercial vehicles …

What a year it’s been for Dietz! Quite frankly, he could not have arrived in South Africa at a worse time. “My timing could have been better,” Dietz says with a wry smile. “It wasn’t great to start a new assignment in a new(ish) country as that country was going into lockdown.”

However, he says things weren’t that bad. “When I arrived in South Africa at the beginning of 2020, I set myself a personal goal: I wanted to meet all our dealer partners and our top customers face-to-face by the end of June. Clearly, that wasn’t possible – which was disappointing. But luckily I arrived here with lots of experience of the South African market (having interacted with the South African team and visited the country many times before). Also, I received a very warm welcome from the dealer partners and the team, which proved to be so eager and diligent,” he reveals.

While the country reeled from the pandemic and the economic effects of the lockdown, Dietz decided to make the best of what was a somewhat bad situation – and the boldest move that he made was the launch of the new Actros. “Some people thought that, due to Covid, we may delay the launch. I decided not to. Back in May 2018 when I was here in South Africa, we made a clear promise to the customers: we are offering the latest technology just in time. I wanted to deliver on that promise.”

Dietz and his team are trying to persuade customers to go the Euro 5 route.

Hence, in June this year, DTBSA launched the 2020 International Truck of the Year, namely the New Actros, which Dietz describes as “the perfect truck for long-haul applications”. At the same time, the company launched the new Arocs for the distribution and construction segments.

An actual launch was obviously not possible; Dietz adapted to the situation by conducting a fabulous online event that was attended by hundreds of transport operators, commercial vehicle writers and captains of the industry from all over the world. “We announced that this incredible vehicle was coming to South Africa with immediate effect and would be manufactured at our plant in East London, based on Euro 3 and Euro 5 standards.”

While Euro 3 is indeed available, the DTBSA team is trying to persuade customers to go the Euro 5 route. “This is the biggest contradiction in the trucking business. Customers are going for leading-edge technology – MirrorCam, Predictive Power Control for instance, that means technical requirements are similar to triad markets – but 90% of the market is still on a Euro 3 emission level. From a global point of view, all first world countries are already in – or moving to – Euro 6 or similar standards,” he notes.

Very positive customer response

So, what did customers think of the truck? Did they concur with Dietz’s sentiments? It seems that the answer is yes, resoundingly so. “The first feedback from the market looks very cheering. During the last global crisis, we experienced a high number of cancellations. The same hasn’t happened this time around – certainly not in the extra-heavy segment. In fact, when the lockdown levels were lifted, the business bounced back nicely. The heavy-duty and long-haul sectors have come back well for us. Of course, the new product has helped,” he reveals.

Even the construction segment, which was previously under pressure, is now picking up. “Unfortunately, volumes in the construction segment – which is one of our main segments – have been quite low for years. However, the reality is that these trucks work under extremely harsh conditions. The result of this is that, at a certain point in time, the truck is completely worn and has to be replaced.” Dietz notes.

Tough times in LDT and MDT segment

While Actros and Arocs sales are soaring, 2020 has been tough for the Fuso brand. “The Fuso business has been more challenging because we’re playing so far mainly in the light- to medium-duty market (LDT and MDT), which has been really hard hit this year. But next year will be much better,” he says. “Fuso is picking up nicely in the HDT segment and we are looking to introduce additional heavy-duty variants from the brand in the New Year.”

Speaking of Fuso, Dietz implemented a big change in the way in which the brand is handled this year. “For the first time, the key account management is now handling both brands (Mercedes-Benz and Fuso) and this is already paying dividends in the marketplace. All the dealers are working across both of the brands too, including service for Freightliner/Western Star and this is proving successful. We have done this in the export markets too and the last market – namely Mozambique – has also shifted to this strategy,” he reports.

“We have a complete truck product and services portfolio for all segments. Through our Mercedes-Benz Truck and Fuso product and services portfolio, I’m proud to say we are perfectly set up to cover all segments in our markets.”

Success in the bus market too

While the truck business has done well, DTBSA also made major gains in the bus market and nearly doubled its market share as per NAAMSA. “The market has been badly affected by Covid, in all segments – commuter, city and coach. But we honestly cannot complain. We restructured the team at head office and brought in specialists, which you really need in the bus business. The new team did an excellent job with this, for example in forging closer relationships with the leading bodybuilders, and we are now reaping the benefits.

“We also have a new business model for buses, which will be effective January 1, 2021. The sales of Mercedes-Benz Buses used to be direct but now we are involving the dealers as well. The direct route was not perfect for small and medium-sized customers around South Africa. Key accounts will remain the domain of head office, but there are well-known and experienced commercial dealers all over the country who are taking care of all customers as well.”

More big news is that DTBSA is preparing for the market launch of a completely new bus chassis. “We want to be prepared for when the bus market recovers. Once the vaccine is available I am convinced that the tourists will return. This will result in additional coach business. Hopefully, we can launch at the beginning of quarter two, Covid permitting.”

Superb dealer support

One of the reasons why DTBSA is in a strong position is the dealer network. “Our dealer partners have done a superb job this year; while constantly focusing on keeping people safe, we were always fighting to keep all doors open. Some of our workshops were only closed for three weeks during the entire lockdown,” Dietz reveals.

Another reason for the company’s success, he believes, is its determination to conduct business as usual. “The Actros launch is a typical example. The launch went very well and got the feedback that we were not just launching a new range, but sending a signal of hope and optimism in challenging times. This sentiment has been shared by transport operators. I’m absolutely impressed and delighted at the optimism of customers, who are moving forward and investing,” he notes.

DTBSA’s optimistic approach extended to its East London plant. “In July we started to increase production capacity, because we were getting lots of positive signals from customers. So, we brought in additional volumes (versus 2019) and also increased our daily production. We also didn’t retrench any staff members. To the contrary, our plant is operating full speed ahead until Christmas.”

This was a challenging time for Dietz and his team. “We were worried that the market could just be catching up after lockdown – and that its buoyancy would not be long-lived. At times, we were not 100% convinced that we were doing the right thing with the decision to increase production volumes. Thankfully, we got it right,” he says with a smile.

“This strategy has been extremely positive for us. It is one of the reasons why our market share of the heavy-duty segment is increasing. Hopefully, the new Actros and all our products will perform extremely well in all fleets, and more business will follow.”

Fleetboard to be standard

If this is not enough, Dietz reveals that Fleetboard will also be standard on all Actros variants and all Arocs in distribution applications (so just the freight carriers) from January 1, 2021. “Most of the customers are already running telematics applications focusing on vehicle data, on driver data and on safety and security.  With the New Actros and Arocs, all the hardware is there, so this is the right time to take the next consequential step.”

With all these tricks up DTBSA’s sleeve, it sounds like 2021 will be yet another extremely successful year for the company …

Published by

Charleen Clarke

CHARLEEN CLARKE is editorial director of FOCUS. While she is based in Johannesburg, she spends a considerable amount of time overseas, attending international transport events – largely in her capacity as associate member of the International Truck of the Year Jury.
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