Interview with Martin Daum and Joe Kaeser: Daimler truck bosses: Will still be “happy about every truck that fills up with hydrogen”
At the same time, the two managers appeal to the new traffic light coalition in Berlin. You demand a holistic concept on the way to CO2 neutrality. “An Agenda 2030+, which describes a socio-ecological market economy of the modern age, is inevitable,” states Kaeser. If, on the other hand, it takes eight to nine years to lay a power line from the north to the south of the country, the coal phase-out will not be possible by the end of the decade.
“The framework conditions have to be changed immediately – and they have to last,” says Kaeser. Because the innovation cycles of the economy would last longer than four years, i.e. longer than until the next election campaign. When switching from diesel engines to electric drives, politics and industry would have to push investments in hydrogen-based fuel cells as well as batteries, assists Martin Daum.
“Once 80 percent of all cars are electric and half of all long-haul trucks, we will be happy about every truck that fills up with hydrogen,” believes the commercial vehicle expert. The reason: If you were to rely solely on battery drives, it would have to be ensured that 100 trucks could charge in parallel at every major service area. This requires 70 megawatts of electrical power. “Alternatively, 35 wind turbines or a two-hectare solar field would work, but neither would be of much use at night,” Kaeser points out.
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The battery and the fuel cell are therefore not competing technologies. “It’s not an either-or, but a both-and-also,” says Daum. The conclusion of the truck bosses is: Without green hydrogen, which is produced in sunny countries and exported from there to Europe, the energy transition cannot succeed.
Read the whole interview here.
Mr. Kaeser, Mr. Daum, until now Daimler trucks had to drive Mercedes-Benz cars in a convoy. Have you broken away from the parent company or did the mother break away from the truck subsidiary?
Daum: Neither. It wasn’t a divorce. The two companies are like siblings who have now recognized their different interests. We couldn’t live it out under one roof. Therefore there are now two groups.
Her sister Mercedes-Benz suddenly appears completely liberated. Without the diesel trucks, the car manufacturer can transform itself more quickly into a pure supplier of electric cars.
Daum: We have never been a burden for the entire group. But: The focus on sustainable luxury cars does not fit in with the truck business, where the cost-effectiveness of a truck is important to customers and not just any image. Luxury is not a value in the trucking sector. The division is therefore good for both companies.
Will Daimler Truck now be the last bastion for the diesel faction?
Daum: That will certainly not be the case. In 2030, however, there will be regions in the world and areas of application in which we will not be able to do without the combustion engine. In many countries, for example in Africa or South America, there will be no infrastructure for electric trucks or hydrogen filling stations. In the long term, these regions will change, but it will take time.
Mr. Kaeser, you have not been noticed as a trucker so far. What attracted you to take on the role of chairman of the supervisory board?
Kaeser: I just feel good here. It is my fourth cell division that I am participating in. At Siemens, I listed Osram as well as health and energy technology.
“When electromobility is ramping up, we need hydrogen and batteries”
So you simply enjoy breaking down companies into their individual parts.
Kaeser: It’s not an end in itself, but the creation of new perspectives. It is usually also an exemption for the respective units. Here at Daimler Truck, I am also enthusiastic about the energies and optimism such a step unleashes. I know from my time on the Supervisory Board of Daimler AG what the ranking was like. The trucks always came further behind in terms of resource allocation.
Daum: We are more focused and can react more quickly to the changes.
What unites the two of you is your irrepressible belief that a huge hydrogen economy will emerge around the globe in the future. How do you come to this assumption?
Daum: When I look out the window, here in the Stuttgart area at this time of the year we often have absolute calm and hardly any sun. The real question is: How can we store and transport green energy? If all of this worked via pipes, we wouldn’t need hydrogen. Unfortunately, electricity from photovoltaic systems cannot be produced in Europe or in North America for less than a cent per kilowatt hour, but only in regions like Australia or the Middle East, where the sun shines constantly. And to bring this energy from there to Germany, we need hydrogen.
But why should the hydrogen be used in trucks of all places? Battery drives are far more efficient.
Daum: The battery and the hydrogen-based fuel cell are not competing technologies – this is not an either-or, but a both-and-also. We need both when ramping up electromobility. Because once 80 percent of all cars are electric and half of all long-haul trucks, we will be happy about every truck that fills up with hydrogen.
Daum: Because otherwise 100 trucks with 700 kilowatts each would have to charge in parallel at every major service area. This would require 70 megawatts of electrical power. And bringing this amount of energy to the rest stops is anything but trivial, isn’t it Joe?
Kaeser: To generate 70 megawatts of energy, you would need a plot of land with a power plant and two turbines next to the service area. Alternatively, 35 wind turbines or a two-hectare solar field were also possible, but neither would be of much use at night. The big slogans that we will have to switch everything to green energy as early as 2030 or even earlier sound wonderful. But we have to remain credible and see what can really be implemented operationally.
“Now the framework conditions have to be changed immediately”
What can be implemented here with the new traffic light coalition?
Kaeser: We have now basically got a synthetic socio-ecological market economy. The SPD stands for the social part, the Greens for the ecological part and the FDP for the market economy. This coalition started with considerable energy. Now demands and reality have to be brought closer together. If it takes another eight to nine years to get a power line from north to south, then it will be difficult with the coal phase-out in 2030.
What are you asking for?
Kaeser: The framework conditions have to be changed immediately – and they have to last. Because the innovation cycles of the economy last longer than four years. We need a holistic concept on the way to CO2 neutrality. An Agenda 2030+, which describes a socio-ecological market economy of the modern age, is inevitable.
Robert Habeck, the new Minister for Economic Affairs and Climate, has announced that he will enter into a dialogue with companies and want to use the “creativity of the markets”. Are you convinced?
Kaeser: It would be good if he got together with the leading companies in the individual sectors. In any case, it is of little use just to talk to the umbrella organizations, because they have so much watering down that there are hardly any topics that can be promoted. What we need, however, are tangible examples that everyone can see. Only when we can show how exactly green steel can be produced, for example, and how exactly we – preferably green – bring electricity to the charging stations for electric cars, will we also create acceptance of change among the population.
For many investors in recent years, Daimler Truck has been the epitome of the attribution: “overpromise and underdeliver”. Why should that change now with your independence?
Daum: Of course we analyzed what went wrong in the past. For example, we have always focused on gaining market share in order to be able to raise the prices for our products later. Now let’s focus instead on the fields that we can actually influence. We have radically reduced costs and enormously improved the quality of our trucks. We are also more transparent than any of our competitors. We report the results of each region. That means: nobody can hide anymore.
“Many major customers want to renew their fleet”
“Every segment has to deliver,” is your credo. But what happens to those areas that can’t do it?
Daum: That is not an option. We will sharpen up if something does not develop in the right direction. That’s what the management is there for. And believe me: nobody on the board wants to be the one who doesn’t deliver. That’s why I am very confident that we will achieve our goals.
Doesn’t the long-running pandemic with new mutants like Omikron endanger your prognosis?
Daum: No, we don’t think so, because the transport volume remains high. But one thing is clear: If we didn’t have any shortages in chips, we would now have the largest sales in our history. The demand is incredibly high. Unfortunately, we won’t be able to build a large number of vehicles this year.
Will this unexploited sales move into the next few years and thus extend the upswing in your industry, or will the next downturn come as quickly as ever?
Daum: We think that the very positive cycle we are currently in will extend. Many of our major customers are planning extensive fleet renewals. That should certainly continue until 2023 or 2024.
You sound very optimistic. China and the US are increasingly decoupling from one another, and the Ukraine may be threatened by an invasion of Russian troops. Are you prepared if any of these conflicts escalate?
Daum: I view these conflicts with great concern. Trade barriers and national egoisms throw us all back years. Daimler Truck is, however, set up on a rock solid basis. We have a strong balance sheet and a good liquidity reserve. I am therefore not afraid of any crisis. We are also firmly anchored in the local economies and try to be as self-sufficient as possible there. This makes our business relatively weatherproof.
Are you that relaxed too, Mr. Kaeser?
Kaeser: It is always difficult to predict how international conflicts will develop. Structurally, however, the Daimler Truck business has a wonderful future.
Why do you think that?
Kaeser: One trend that is often overlooked is internet trading. Ever smaller batch sizes are brought to the customer faster and faster. When transporting large containers, it is sufficient if the truck drives every few weeks. With online trading, on the other hand, the need for goods mobility is increasing massively. And that plays into the cards for Daimler Truck. Thousands of ships are already standing in front of the ports that cannot be unloaded because there are not enough trucks to carry the containers away.
But there is also an enormous shortage of truck drivers: and without a driver you will hardly be able to sell trucks.
Kaeser: We have to make these jobs more attractive and change the rhetoric. We mustn’t convince people that soon all trucks will be driving autonomously. We are still a long way from that. We still need a lot of reliable truck drivers. This business offers very good future prospects.
More: Daimler Truck, Traton and Volvo are investing 500 million euros in charging network joint venture.