Daimler Truck will continue to bet on diesel engines for now, with hydrogen and electric as next priorities.
12 Oct 2022 | 15177 Views | By Ketan Thakkar
Even as the shift towards electrification gains momentum world over, Martin Daum, the Chairman of the Board of Management of Daimler Truck Holding AG – the world’s largest truck maker says, “diesel has another 10 years, if not 15, years of life (ahead).”
The maker of Bharat Benz Trucks ...
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Even as the shift towards electrification gains momentum world over, Martin Daum, the Chairman of the Board of Management of Daimler Truck Holding AG – the world’s largest truck maker says, “diesel has another 10 years, if not 15, years of life (ahead).”
The maker of Bharat Benz Trucks therefore will be investing in another round of diesel engines to meet the transportation needs of its market.
Daum, who is in India to celebrate the 10-year anniversary of selling Bharat Benz trucks, agrees that if one wants to save the globe from climate change, the need is to move to zero emission. But that requires a real revolution in electricity generation, transmission and distribution not only in India but even in the US and Europe which are in short supply at present, he said.
“You may have the best electric battery and truck but using coal as a source of energy will heat up the planet more than the diesel truck,” he said.
According to Daum, there is a need to double or triple the power generation capacity around the world. “You are meeting only 20-30 percent of the requirements at present. And once you build the capacity to generate power, it is difficult to transport and store it,” he said.
Daum says even solar and wind power are unreliable sources in Germany. So the hydrogen fuel cell appears to be a more practical solution for the future.
On its part, Daimler Truck is adopting three strategies at present.
“We still feel diesel has another 10-15 years of life ahead, therefore we are investing in another round of diesel engines; we know we have the best diesel engines for the heavy-duty segment. Second, we will make electric trucks step by step, but it is significantly more expensive. Number three, we believe, hydrogen is the only way to transport and store clean energy,” explained Daum.
The head of German Truck major says the group is not investing in natural gas for the future at a global level as it emits almost as much co2 as diesel, maybe a little less, but it is not a reliable solution for the future in the path towards zero emission.
These comments from Daum come at a time, when the Indian market has started witnessing a significant shift towards CNG in the light and medium duty truck range over the last few years.
Daimler India’s rivals Tata Motors and Ashok Leyland have significantly captialised on this shift, wherein almost one-fourth to one third of their light and medium duty sales came from the CNG powertrain, but the German truck maker has remained absent from the segment due to the global decision.
“A highly efficient diesel truck is better than natural gas trucks. CNG trucks are not nice to drive, and they emit similar co2. For the future it does not make sense to invest on five different powertrains. Our priorities are diesel, fuel-cell and electric,” he added.
To be sure, Daimler India was exploring CNG options when the segment was witnessing traction in the marketplace, however it does not appear to be making significant progress at present.
Satyakam Arya, MD of Daimler India Commercial Vehicles says the penetration of CNG in India is not on account of zero emission but to reduce crude oil imports. The country imports about 40 percent of the gas requirement.
Given the recent spike in gas prices, Arya says he does not believe that the company has reached a stage, wherein it can predict a stable adoption of gas in its business.
“When there was a price parity, we saw CNG sales picking up, but as the gas prices moved up, customers started switching to diesel. Technology bets cannot be taken in an uncertain pricing environment, if there is stability in price, we may explore a tactical introduction, but we are still not sure,” added Arya.
The powertrain strategy for future in India is aligned to global direction of electric and H2 are technologies that are being worked on for India
On Daimler’s presence of over a decade in India, Daum says the country exceeded expectations on talent development and taking larger exports responsibility. However, it has not met the expectation on total industry volumes and the share of modernised sophisticated trucks.
“We thought the market would develop much faster. That has not proved to be the case. It is far behind initial estimates and we have seen very slow growth of the sophisticated truck space, where we lead,” Daum said.
The company, however, maintained having weathered many cycles. Daimler has set up a very strong fundamental base to be ready to capture the current upcycle that the market is witnessing.
Arya says Daimler is currently operating at its optimum capacity and is ready to capitalise on the growth in the marketplace.
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