Private Sector

Daimler India hoping to foray into defence space

Daimler India Commercial Vehicle (DICV) is looking to manufacture defence vehicles, off-highway engines and LCVs in a enter uncharted territory to promote innovation, fresh business ideas and bolster revenue growth.

“We have started studying what the requirements are from the defence side,” said Satyakam Arya, managing director and CEO, DICV. “They need a 4×4 truck mostly and we have started a study on developing that. We, however, have one step to cross and we have to see whether the government of India changes that regulation.”

The regulation he was referring to was with regard to the policy that does not permit foreign companies to supply for defence purposes. He added that the government has indicated that it will look at changing this clause as a truck is a commodity and that more clarity should emerge about this in April.

The German auto major’s Indian arm has plans of foraying into new avenues was part of a larger vision the company has to find ways to “go beyond trucks” and to encourage innovation. In this regard, he also mentioned that another segment that the company was actively studying was that of freight aggregators.

DICV’s domestic business recorded a drop of 36% with sales of 14,474 trucks in 2019, in line with the 35% drop in industry sales volumes. Exports grew by 14 per cent to over 8,000 units in 2019. When it came to the outlook on the industry, Arya said he expects a 10 per cent decline at the least which could extend to 20-25 per cent if there is no uptick.

Arya said he was optimistic that the shift to BS-VI will bode well for the company since they have already started rolling out trucks in NCR where BS-VI fuel is available. He added that he hoped there would be no further extension in the date for BS-VI compliance.

“Our access to Daimler’s worldwide network to technological expertise allowed us to efficiently localise our globally-proven Euro06 solution for India’s BSVI emission norms. This helped us to control development cost,” said Arya.

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ET News
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