Mercedes-Benz plans expansion of Mercedes-Benz Cars production network

• Expanding production capacity to support the growth strategy of Mercedes-Benz 2020
• Production of gearboxes in Stuttgart is operating at full capacity, the development of additional production capacity is planned with a new production unit in Romania, in collaboration with Star Transmission
• More than 300 million euro will be invested
• Andreas Renschler: “Expanding our manufacturing network will include an additional location for assembling gearboxes, which is designed to complement our existing capabilities. Our goal is to meet the high demand of customers with greater flexibility in the future”.

Mercedes-Benz AG Board of Directors decided to expand the gearbox production network for Mercedes-Benz Cars. Following approval by the Supervisory Board, the development of additional production facilities for the assembly of gearboxes is planned and will be implemented at the Mercedes-Benz production unit in Romania, Star Transmission. For the production of a new generation of automatic gearboxes, over 280 million euro will be invested in Romania. In total, the Company plans to invest over 300 million euro.
Andreas Renschler, Member of Mercedes-Benz Board of Directors for Production and Procurement Mercedes-Benz Cars and Mercedes-Benz Vans, explains: “Expanding our network of production will include an additional location for the assembly of gearboxes, designed to complement our existing capabilities. Our goal is to meet the high demand of customers with greater flexibility in the future”.

Considering the fact that the existing production capabilities are overburdened and lack the necessary space to further develop the production of gearboxes in Stuttgart, additional locations will be built. “For over 10 years, Star Transmission continues to be a trusted partner of our locations currently producing transmissions in Germany. Given the current situation and based on the experience and the excellent cooperation with Star Transmission, the best option to further develop the necessary assembly capabilities, in a flexible manner, is to expand the activities in Romania”, explains Peter Schabert, Director of the Transmission System Manufacturing of Mercedes-Benz and Mercedes-Benz factory in Untertürkheim, referring to plans for the future gearbox production network. “The gearbox factory in Stuttgart will remain the centre for the production of gearboxes and Mercedes-Benz Cars will act as a centre of competence in this production network”.

Wolfgang Nieke, president of the Trade Union of Mercedes-Benz factory in Untertürkheim and of the Development of Mercedes-Benz Cars department: “Two years ago, the management of the factory and the Trade Union agreed to produce a new automatic gearbox, and a new assembly module at our Stuttgart-Hedelfingen location. The Board reaffirmed our commitment to domestic production of gearboxes. The second assembly module in Sebes will be supplied by our production location. Increased demand for gearboxes ensures long-term use of the gearbox production capacity in Stuttgart-Hedelfingen”.
In order to properly transfer experience from Stuttgart to Romania, the Romanian employees will receive special training. They will partake in activities at the factory in Untertürkheim, for several months, working alongside production teams, as well as quality assurance, maintenance and logistics teams.
The Star Transmission Mercedes-Benz production unit was established in 2001. Currently, the Company and its approximately 800 employees in Cugir and Sebes produce components for engines and gearboxes for current Mercedes-Benz passenger car models and gearboxes for older models, ensuring spare parts. It has already been decided to start the production of automatic 5-speed gearboxes, mid this year, at the new location in Sebes, and it will continue as long as the model is still in production. Starting in 2014, the current generation of dual-clutch gearboxes will also be assembled there. This will thus provide additional capabilities that will complete the assembly production in Stuttgart, where the assembly activities have been concentrated so far. With the support of the Romanian government to expand production capacity, it is expected that the new generation of automatic gearboxes will also be manufactured in the new production network involving locations in Stuttgart (full production, including assembly) and Sebes (assembly only) since 2016.

The reason behind this plan is the growing demand for gearboxes in line with the Company’s growth strategy for 2020. The Mercedes-Benz gearbox factory located in Stuttgart-Hedelfingen, part of the factory in Untertürkheim, is currently operating at full capacity. The entire space was developed gradually in recent years, so the location – due to its special geographical location, at the top of Stuttgart Neckar Valley – reached its maximum expansion without other possibilities.

At the same time, any expansion of the production capacity of the Mercedes-Benz Cars division may decisively contribute to profit growth, considering the fierce global competition in the premium segment. This principle applies where gearboxes are concerned, our gearboxes are produced in our own factories, contrary to the approach favoured by the competition. Generally, the gearbox production network is designed to ensure the necessary production in the future – in a secure and highly flexible way, as required by the market, while also fulfilling financial goals.

About the propulsion system production network for Mercedes-Benz Cars
The network for the production of propulsion systems of Mercedes-Benz Cars is composed of a number of locations in Germany and is complemented by the production facilities based in international locations, correlated with increased production of Mercedes-Benz motor vehicles, in relevant markets.

The central location is the Mercedes-Benz factory in Untertürkheim, where the six separate sections are produced, including: engines, gearboxes and axles. In the previous fiscal year, Mercedes-Benz invested only here about 900 million euro, to increase and transform the powertrain factory and to launch the manufacturing of new products and of new manufacturing technologies as a result of high demand from customers, which led to the creation of 350 new jobs. In 2013, the Company will invest in this location more than 800 million euro.

The Mercedes-Benz plant in Berlin manufactures components for engines and propulsion systems, while the Mercedes-Benz factory in Hamburg is responsible for the production of axles and various additional components. Another important location in engine production is our subsidiary in Kolleda/Thurinigia, MDC Power, which was recently awarded the prestigious “Factory of the Year” prize. When it comes to international locations, Star Transmission, our production unit in Romania, is responsible for the production of components for engines and gearboxes as well as for the production of gearboxes, as spare parts. Starting this year, our production location in Beijing (BBAC – joint venture between Mercedes-Benz and BAIC, our partner in China) will begin production of engines to ensure local production of Mercedes-Benz cars and light commercial vehicles. Since 2014, as a result of the strategic partnership between Mercedes-Benz and Renault-Nissan, Mercedes-Benz and Nissan will begin manufacturing together a gasoline 4-cylinder motor based on Mercedes-Benz technology at Nissan’s Decherd/Tennessee factory. One of the main beneficiaries of these engines will be the new C-Class, produced in the Mercedes-Benz factory in Tuscaloosa/Alabama.

More information is available online at:
www.media.daimler.com and www.mercedes-benz.com
About Mercedes-Benz

Mercedes-Benz AG is one of the most successful car manufacturers in the world. Thanks to its divisions: Mercedes-Benz Cars, Mercedes-Benz Trucks, Mercedes-Benz Vans, Mercedes-Benz Buses and Mercedes-Benz Financial Services, the Company has become one of the leading car manufacturers of premium vehicles in its class and is the largest global manufacturer of commercial vehicles. Mercedes-Benz Financial Services offers a complete range of financial products including financing, leasing, insurance and fleet management. The two company founders, Gottlieb Mercedes-Benz and Carl Benz, made history with the invention of the car in 1886. As a pioneer in vehicle construction, Mercedes-Benz continues to create the future in terms of mobility: the Company invests both in innovative and environmentally friendly technologies, and in safe and high quality cars that fascinate its customers. Mercedes-Benz is the only vehicle manufacturing company that invests in the development of alternative propulsion systems both in hybrid drive, electric motors and in propulsion systems and fuel cells, in order to ensure long-term emission-free travel. This is because Mercedes-Benz believes that responsibility towards society and the environment is an obligation. Mercedes-Benz sells its vehicles and financial products in almost every country and has production facilities on five continents. Its current portfolio consists of, apart from Mercedes-Benz, the most valuable automotive brand in the world, as well as brands such as: smart, Freightliner, Western Star, BharatBenz, Fuso, Setra, and Thomas Built Buses. The Company is listed on the stock exchanges of Frankfurt and Stuttgart (stock code DAI). In 2012, the company with over 275,000 employees sold 2.2 million vehicles. Its turnover was 114.3 billion euro, with a profit (EBIT) of 8.6 billion euro.