DGAP-Adhoc: Daimler AG: Daimler Trucks North America plans decisive response to changed economic environment

Daimler AG / Strategic Company Decision


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• Focus on a two brand strategy: discontinuation of Sterling Trucks brand 
• Consolidation of manufacturing plant network
• Expected annual earnings improvements of $900 million by 2011
• Estimated program costs of $600 million 

Stuttgart/Portland – Daimler Trucks North America (DTNA) today announced a
comprehensive plan to adjust and strengthen company operations in response
to continuing depressed demand across the industry and structural changes
in the company’s core markets.

'It is a principle of our ‘Global Excellence’ strategy to strive for
benchmark profitability and to address structural market changes in a
timely and consequent way', said Andreas Renschler, Member of the Board of
Management of the Daimler AG, responsible for Daimler Trucks; 'We are
confident that this forward-looking strategy for DTNA is the right measure
to address the challenges in the North American market.'

The measures to be implemented address three key areas of DTNA’s

Focus on a two brand strategy: discontinuation of the Sterling Trucks
product line

The Sterling Trucks brand will be discontinued effective in March 2009. 
Additions to the Freightliner and Western Star product ranges will be made
to address market segments that have been served exclusively by Sterling
offerings in the DTNA stable.

By concentrating the company’s considerable technical and marketing
resources on a more focused model line-up, DTNA expects to drive an even
more attractive program of innovation in safety, environmental impact, and
user productivity that will further strengthen the leadership position of
Daimler Trucks in the North American commercial vehicle market.

Consolidation of manufacturing plant network and alignment of network
capacity with market demand

As a result of the decision to discontinue the Sterling brand, the St.
Thomas, Ontario, plant will cease truck manufacturing operations in March
2009, concurrent with the expiration of the existing agreement with the
Canadian Auto Workers members employed there.  The plant currently
manufactures Sterling medium and heavy-duty trucks.

DTNA will also close the Portland, Oregon, Truck Manufacturing plant, in
June 2010, when current labor contracts expire.  Western Star commercial
production will be assigned to the company’s Santiago, Mexico plant, while
production of Freightliner-branded military vehicles will take place at one
of the company’s facilities in the Carolinas by mid-year 2010.

Start of production at DTNA’s new Saltillo, Mexico manufacturing plant will
occur as planned in February 2009.  The plant will produce Freightliner’s
new flagship Cascadia model.

Expected annual earnings improvements of $900 million by 2011, with
estimated program costs of $600 million

As a result of the measures cited above, DTNA expects to achieve annual
earnings improvements of $900 million by 2011.  The EBIT effects amount to
$600 million in total: approx. $350 million against the fourth quarter of
2008 (including approx. $300 million, which are primarily related to
employee and dealer separation), $150 million in 2009 as well as expenses
of $100 million in 2010 and 2011 in total.

An estimated 2300 workers in the St. Thomas and Portland plants will be
affected by mid-2010, on timelines related to the plant closures noted
above. This figure includes 720 workers at the St. Thomas plant to be laid
off in November 2008 as already announced in July.

The company also plans to reduce its salaried workforce by approximately
1200 positions, with over half directly related to the Sterling brand. A
voluntary separation program will be available as well as other measures to
offer flexibility and choice to affected employees.
Further information from Daimler is available on the internet at:

This document contains forward-looking statements that reflect our current
views about future events. The words 'anticipate,' 'assume,' 'believe,'
'estimate,' 'expect,' 'intend,' 'may,' 'plan,' 'project,' 'should' and
similar expressions are used to identify forward-looking statements. These
statements are subject to many risks and uncertainties, including an
economic downturn or slow economic growth in important economic regions,
especially in Europe or North America; the effects of the credit crisis
which could result in a weaker demand for our products particularly in the
U.S. but as well in the European market; changes in currency exchange rates
and interest rates; the introduction of competing products and the possible
lack of acceptance of our products or services; price increases in fuel,
raw materials, and precious metals; disruption of production due to
shortages of materials, labor strikes or supplier insolvencies; a decline
in resale prices of used vehicles; the business outlook for Daimler Trucks,
which may be affected if the U.S. and Japanese commercial vehicle markets
experience a sustained weakness in demand for a longer period than
expected; the effective implementation of cost reduction and efficiency
optimization programs; the business outlook of Chrysler, in which we hold
an equity interest, including its ability to successfully implement its
restructuring plans; the business outlook of EADS, in which we hold an
equity interest, including the financial effects of delays in and
potentially lower volumes of future aircraft deliveries; changes in laws,
regulations and government policies, particularly those relating to vehicle
emissions, fuel economy and safety, the resolution of pending governmental
investigations and the outcome of pending or threatened future legal
proceedings; and other risks and uncertainties, some of which we describe
under the heading 'Risk Report' in Daimler’s most recent Annual Report and
under the headings 'Risk Factors' and 'Legal Proceedings' in Daimler’s most
recent Annual Report on Form 20-F filed with the Securities and Exchange
Commission. If any of these risks and uncertainties materialize, or if the
assumptions underlying any of our forward-looking statements prove
incorrect, then our actual results may be materially different from those
we express or imply by such statements. We do not intend or assume any
obligation to update these forward-looking statements. Any forward-looking
statement speaks only as of the date on which it is made.

About Daimler
Daimler AG, Stuttgart, with its businesses Mercedes-Benz Cars, Daimler
Trucks, Daimler Financial Services, Mercedes-Benz Vans and Daimler Buses,
is a globally leading producer of premium passenger cars and the largest
manufacturer of commercial vehicles in the world. The Daimler Financial
Services division has a broad offering of financial services, including
vehicle financing, leasing, insurance and fleet management.
Daimler sells its products in nearly all the countries of the world and has
production facilities on five continents. The company’s founders, Gottlieb
Daimler and Carl Benz, continued to make automotive history following their
invention of the automobile in 1886. As an automotive pioneer, Daimler and
its employees willingly accept an obligation to act responsibly towards
society and the environment and to shape the future of safe and sustainable
mobility with groundbreaking technologies and high-quality products. The
current brand portfolio includes the world’s most valuable automobile
brand, Mercedes-Benz, as well as smart, AMG, Maybach, Freightliner,
Sterling, Western Star, Mitsubishi Fuso, Setra, Orion and Thomas BuiltBuses. The company is listed on the stock exchanges in Frankfurt, New York
and Stuttgart (stock exchange abbreviation DAI). In 2007, the Group sold
2.1 million vehicles and employed a workforce of over 270,000 people;
revenue totaled €99.4 billion and EBIT amounted to €8.7 billion. Daimler is
an automotive Group with a commitment to excellence, and aims to achieve
sustainable growth and industry-leading profitability.
DGAP 14.10.2008 
Language:     English
Issuer:       Daimler AG
              Mercedesstraße 137
              70327 Stuttgart
Phone:        +49 (0)711-17 413 61
Fax:          +49 (0)711-17 413 72
E-mail:       ir.dai@daimler.com
Internet:     http://www.daimler.com
ISIN:         DE0007100000
WKN:          710000
Indices:      DAX, EURO STOXX 50
Listed:       Regulierter Markt in Frankfurt (Prime Standard), Stuttgart;
              Freiverkehr in Berlin, Hannover, München, Hamburg,
              Düsseldorf; Foreign Exchange(s) NYSE
End of News                                     DGAP News-Service