Daimler's Breaking Up the Band: German Giant Plans Massive Corporate Overhaul

Daimler AG unveiled a new corporate structure on Thursday that splits its core businesses into a three legally independent entities, with one of the arms focusing entirely on mobility and financial services.

It’s a sign of the times as automakers press ever deeper into an uncertain tomorrow, all thanks to mobility and data services. “The new structure positions Daimler to tackle the rapid pace of change in the mobility sector and the corresponding strategic challenges,” explained Supervisory Board chairman Manfred Bischoff. “Legally independent divisions will sharpen our focus on the future success of the business.”

This is no small feat, as altering the structure involves reassigning more than 700 Daimler subsidiaries in over 60 countries. After which, Mercedes-Benz AG, Daimler Truck AG and Daimler Mobility AG will operate as one under the Daimler AG umbrella.

According to the automaker, the new structure will better prepare for the future with “greater entrepreneurial freedom” for divisions, stronger market and customer focus, and the availability of faster and more flexible partnerships. It also adds some protection for the other divisions, as the mobility unit ventures out into untamed territory and new business opportunities.

Already legally independent, Daimler Financial Services will be baked into Daimler Mobility AG.

Once the structure is fully implemented, Daimler says Mercedes-Benz AG should have around 175,000 employees worldwide. Meanwhile, the Trucks & Buses division, under the leadership of Daimler Truck AG, will have around 100,000 employees and Financial Services plays host to roughly 13,000 employees of its own.

Entitled “Project Future,” Daimler believes the new strategies will better position itself for the challenges and opportunities of what it calls “the new automotive era.”

“Project Future is the consistent continuation of our strategy,” said Mercedes-Benz head Dieter Zetsche. “We are reshaping our organization to put Daimler in the best position for the future: technologically, culturally — as well as structurally. At the heart of all these changes are the needs of our customers around the world: With the new structure we will be able to offer them mobility solutions even better tailored to their needs.”

The Board of Management and Supervisory Board for Daimler AG have already approved the divisional structure of the auto group. The matter will now be submitted for approval by shareholders at Daimler’s annual meeting in May of 2019. Full implementation of the corporate strategy is expected by 2020.

[Images: Daimler]