Portfolio changes and strategic partnerships
By means of targeted investments and future-oriented partnerships, we strengthened our core business and utilized additional growth potential in 2016. At the same time, we focused on the continuous further development of our business portfolio, as well as on improving our competitiveness in our core business areas.
Daimler Financial Services acquires Athlon
Daimler Financial Services made strategic investments in its fleet management business in the year under review. In June 2016, agreements were signed governing the acquisition of Athlon Car Lease International B.V., a subsidiary of the Rabobank Group in the Netherlands. Athlon is a leading provider of mobility solutions in Europe, with a particular focus on commercial fleet leasing and management. It is planned to operate Daimler’s entire fleet-management business under the Athlon brand. This new brand will mark the emergence of one of the leading companies in the European fleet management sector, with a portfolio consisting of approximately 360,000 cars and vans. The transaction was completed in December 2016 following approval by antitrust and other supervisory authorities.
Strengthening mobility services
Daimler has continually invested in the establishment and expansion of mobility platforms and services in recent years. In order to ensure that we occupy a position as a leading provider of innovative mobility solutions, we strengthened and expanded our activities in this area during the year under review.
In April 2016, the moovel Group, which is a wholly owned Daimler subsidiary, reorganized its activities in North America: GlobeSherpa was merged into RideScout and renamed as moovel North America. The consolidation of our mobility services under the management of moovel North America will strengthen our business activities in this sector on the US market. moovel Group offers customers moovel transit in the United States and in Germany the moovel mobility app. Hamburg has now become the first German city with more than one million residents to receive one-stop urban mobility services via moovel and its app, which now allows for the direct booking and payment of services provided by car2go and mytaxi, as well as train journeys and trips within the Hamburger Verkehrsverbund (HVV) regional transport network.
The Daimler subsidiaries mytaxi and Hailo, two innovative and leading app-based taxi ordering services, joined forces in the reporting year. The merger has created Europe’s biggest company in this sector, with 100,000 registered taxi drivers and 6 million customers in more than 50 cities in nine European countries. Daimler has a 69 % interest in the merged company. The two providers complement each other perfectly with their combined geographical coverage: Hailo operates in the United Kingdom, Ireland and Spain, while mytaxi offers services in Germany, Italy, Austria, Poland, Portugal, Spain and Sweden.
Daimler has also increased its stake in the professional chauffeur service portal Blacklane to 31 %. Blacklane has received an eight-digit investment that it will use to further expand its global business. Blacklane has around 200 employees and is represented in over 250 cities and 500 airports in more than 50 countries worldwide. Daimler has invested in Blacklane since 2013. The global market for professional ride services is currently estimated to have a volume of about US$30 billion per year, and it continues to evolve and grow. Daimler also holds an interest in Flixbus, a long-distance bus operator.
Extensive investment in electric mobility
Construction of a second battery factory for our wholly owned subsidiary Deutsche Accumotive began in Kamenz in October 2016. Daimler thus continues to move ahead systematically with its strategy for electric mobility. With an investment of approximately €500 million, the site in Kamenz will be one of the biggest and most modern battery factories in Europe. Daimler plans to invest a total of around €1 billion in the expansion of its global battery production network. The Group already offers a large number of electric vehicles and will continue to expand that product range. Mercedes-Benz presented its new electric mobility brand, EQ, at the 2016 Paris Motor Show. EQ offers a comprehensive electric-mobility ecosystem of products, services, technologies and innovations. The new brand is heralded by the near-production Concept EQ, which had its world premiere in Paris. The first series-produced EQ model will be launched in the SUV segment before the end of this decade. It will be followed by a model offensive that will gradually expand the portfolio of Mercedes-Benz Cars to include even more electric models. Deutsche Accumotive will supply the batteries for the first EQ production cars. (See The centerpiece of e-mobility)
Development of a charging infrastructure for electric vehicles
The development of an effective charging infrastructure is a precondition for the success of electric mobility. Daimler is cooperating with various partners in this area. In November 2016, it was announced that Daimler AG, the BMW Group, Ford Motor Company and the Volkswagen Group with Audi and Porsche are planning a joint venture to establish Europe’s biggest charging network for electric vehicles. The partners have signed a memorandum of understanding to this effect. Together, they will quickly set up a substantial number of charging stations, thus considerably enhancing the long-distance practicality of electric mobility. Also together with other partners in German industry, Daimler holds a stake in the e-roaming platform Hubject, a joint venture that is promoting the digital connectivity of charging stations for electric vehicles throughout the industry.
Expansion of our business with stationary energy storage
Daimler AG systematically expanded its network of expertise for lithium-ion battery applications in 2016. Mercedes-Benz Energy GmbH, which was established in June, is now responsible for the development and global sales of stationary energy-storage units of the Mercedes-Benz brand. This move enables Daimler to operate in a more targeted manner in the growing market for stationary batteries. The production of the systems remains the core area of expertise at our subsidiary Deutsche Accumotive GmbH & Co. KG. By expanding this line of business to include stationary batteries for private and industrial applications, Deutsche Accumotive GmbH & Co. KG was able to open up new growth opportunities in 2015. Deliveries of domestic storage solutions for the German market began in April 2016, and work has already started on setting up the first large-scale industrial projects in the field of primary control power. With the establishment of Mercedes-Benz Energy GmbH in Kamenz, Germany, the company is now taking another step toward expanding its business with stationary energy storage. Here, Daimler is focusing in particular on international expansion and collaboration with new partners. For example, Mercedes-Benz Energy Americas, LLC was established in October 2016 as a distributor of stationary storage systems for private households and commercial and industrial applications in the North American market.
Support for startups
Daimler pursues a variety of approaches designed to help the company benefit from the creativity, speed and agility of startups that are not part of the Group’s holdings. For example, Daimler is working in the Start-up Autobahn project with the US venture capital company Plug and Play, the University of Stuttgart and various startup companies that develop innovative mobility ideas. Daimler and its partners support the project by making their expertise and infrastructure available. The specially selected startups in the project are given three months to develop their ideas further and to present them to investors, who then decide whether or not they should receive funding.
Daimler also makes relatively small strategic investments in venture capital funds in the United States, China and Israel via Daimler Vermögens- und Beteiligungsgesellschaft mbH and Daimler North America Corp. Strategic cooperation with these funds enables us to gain access to innovative startup companies and to benefit from new trends early on. In other words, the venture capital funds help us identify investment opportunities and new technologies and to develop business models that support the objectives of various Daimler strategies.
Pension plan assets strengthened
The Board of Management of Daimler AG approved a measure that went into effect on June 30, 2016 to add approximately €1.8 billion to domestic plan assets in Germany in order to strengthen the pension plan assets over the long term. This was effected by transferring the 3.1 % shareholdings in each of Renault S. A. and Nissan Motor Co. Ltd. into the Daimler AG pension fund. This improved the funded status of our pension obligations and also led to a non-recurring positive EBIT item of approximately €0.6 billion in 2016. Regardless of the share transfer, we will continue our successful strategic partnership with the Renault-Nissan Alliance.
EU antitrust proceedings
In a settlement reached on July 19, 2016, the European Commission concluded the antitrust proceedings against Daimler and other truck manufacturers that commenced in 2011. The Commission imposed a fine on Daimler amounting to €1.0 billion. Daimler cooperated closely with the authorities throughout the proceedings, and the European Commission took this into account in reducing the fine imposed. Daimler had recognized a provision for the proceedings and paid the fine in September 2016.