Daimler AG looks set to separate its truck and luxury car divisions. Back in October, the company approved a measure to split Daimler Trucks from Mercedes-Benz. The move appears to be a strategic one aimed at boosting the valuation of both brands.
On a watershed occasion, 99.9% of Daimler AG shareholders voted in favor of the deal, making the split all but a certainty. Daimler says it's doing this to improve efficiency for the truck division and Mercedes-Benz. The separation will allow each to focus on timely industry trends like autonomous driving, electrification, and solid-state battery technology.
Investors have also reportedly sought the deal to improve the truck division's transparency and profitability. Daimler Trucks is the world's largest truck maker, but it has struggled to raise profit margins in recent years. It has previously tried other measures, including cost-cutting programs, which have only improved the luxury car division.
In the end, investors care most about the bottom line, and this is something Daimler Trucks will have to improve on moving forward. The improvement might have to happen sooner than later, as the split could make the company vulnerable to takeover attempts by other companies.
Investors seemed bullish when Daimler AG announced the successful vote in October. Company shares rose by 1.3% to 77.7€ after the fact, putting the German company at an 83.1-billion euro valuation. At the time of writing, Daimler's price is currently hovering at around €85 EUR.
Daimler's truck models are available in the Philippines, but they're not as widespread as some of the popular commercial vehicles in the country. The trucks command a premium price and could be out of reach for many local business owners. With Daimler Trucks on the verge of a new beginning, the time could be ripe for the bran's reintroduction to the Southeast Asian market.