Daimler takes balanced approach

28 November 2012

BERLIN: Daimler, the carmaker owning brands like Mercedes-Benz, is balancing its approach to tap the sizeable revenues available in mature markets and vast possibilities offered by fast-growth economies.

According to Dieter Zetsche, chairman of Daimler and head of Mercedes-Benz cars, some 30% of the firm's sales and profits now originate in emerging nations, compared with less than 10% a decade ago.

"That is certainly progress," he told the Boston Consulting Group. "Are we satisfied? Of course not. Because there are so many more opportunities.

More specifically, Zetsche suggested around 25% of its growth from 2010 to 2015 will be supplied by the "triad markets" of the European Union, the US and Japan, and 75% by developing countries.

"From 2015 to 2020, we expect 95% of the growth to come from emerging markets," he added. "Those numbers speak a clear language.

"Yet, even in 2020, almost half of revenues will still be within the triad markets. So you cannot do either/or. You have to maintain your strength in the traditional markets and even expand it."

One key priority for the company across the globe has been to tackle sustainability issues, and today it holds annual gatherings featuring non-governmental bodies, politicians and similar stakeholders.

"There is a very open dialogue, and we receive a lot of criticism," said Zetsche. "But at the end of the two- or three-day session, we leave with specific tasks. A year later, we have to report what we have done."

Social media is also a central concern for Daimler, which embraces the principles of authenticity and transparency, alongside taking an active presence should any crisis situations emerge.

"Once you accept that, it becomes a tremendous opportunity because you turn around and say, 'Let's not try to paint something pink which is not pink. But let's rather listen, let's use these platforms,'" said Zetsche.

Looking ahead, Daimler is seeking to encourage greater diversity across its leadership team, reflecting broader geographical and social priorities.

"It is more than obvious that we have to become more female – not individually but as a group – and that we have to have more non-German members, ultimately representing the markets that we are doing business in," Zetsche added.

Data sourced from Boston Consulting Group; additional content by Warc staff