17 Jun 2025
A Strategic Move to Strengthen Asia Pacific Presence
Daimler Truck has inaugurated a new manufacturing facility in Cikarang, Indonesia, as part of its broader strategy to capture emerging opportunities in the Asia Pacific. This new plant marks a significant milestone in the company’s regional growth, with strong technical and managerial backing from Daimler India Commercial Vehicles (DICV), the maker of BharatBenz trucks.
Key Highlights of Daimler’s Cikarang Plant Launch
The new plant reflects Daimler’s focused approach to operational efficiency, regional integration, and faster turnaround in vehicle manufacturing.
- Built with investment of approx. INR 265 crore (IDR 500 billion)
- Significantly more efficient than the previous Jakarta plant (0.8 km vs. 16 km assembly line)
- Will manufacture Mercedes-Benz Axor trucks and bus chassis
- Designed to leverage ASEAN and RCEP free trade agreements
- Facilitates smoother exports to Thailand, Malaysia, Vietnam, Philippines, and beyond
- Supported by engineers and CKD kits from India-based DICV
India’s Pivotal Role in Daimler’s Expansion
The Indonesian facility is not just a standalone move—it is deeply integrated with India’s commercial vehicle manufacturing strength. DICV, headquartered in Chennai, has deployed experts to Indonesia to enable a seamless knowledge transfer. Additionally, the new plant will report directly to Indian management and receive CKD (Completely Knocked Down) kits from India, further increasing export volumes for DICV.
Satyakam Arya, Managing Director & CEO of DICV, stated during the plant's inauguration, “We will play a key role in building capabilities in Indonesia—transferring knowledge, developing talent, and strengthening the regional ecosystem. This is about combining German engineering, Indian production expertise, and Indonesian market understanding.”
BharatBenz Expertise in Action
DICV, which manufactures the BharatBenz brand for the Indian and export markets, brings valuable experience to this collaboration. Given the shared platform of Mercedes-Benz Axor across both India and Indonesia, the two operations will function in a complementary manner. Arya also hinted at plans to introduce homologated mining trucks made in India into the Indonesian market, based on evolving demand.
Broader Industry Context
The opening of the new plant comes amid Daimler Truck Holding AG’s wider restructuring, following its split from Daimler AG in 2021. This includes deeper regional integration and partnerships to accelerate the shift toward zero-emission and autonomous vehicles.
In June 2025, Daimler announced a landmark merger of its Japanese unit Mitsubishi Fuso with Hino Motors (Toyota Group). This alliance aims to pool resources for CASE (Connected, Autonomous, Shared, Electric) technologies, including hydrogen-based mobility.
Karin Rådström, CEO of Daimler Truck, remarked, “Together, Mitsubishi Fuso and Hino have great potential to leverage scale—and scale is key to win in the technological transformation of our industry.”
DICV’s Continued Growth Despite Domestic Challenges
While the Indian commercial vehicle market saw a 10% decline in 2024, DICV stood out by reporting:
- Highest-ever annual bus sales (~2,200 units)
- 65.9% growth in bus exports (~1,000 units)
- Rs 1,381 crore in customer service revenue (27.8% YoY growth)
- 18% growth in the aftermarket segment
These numbers reaffirm DICV’s strength and resilience as a core pillar in Daimler’s Asia strategy. Arya emphasized, “India remains a cornerstone of our global export strategy. Leveraging Indonesia is about expansion, not replacement. Growth in Indonesia directly benefits our Indian operations.”
Why Indonesia?
Indonesia offers strategic trade advantages and a strong economic growth rate of 5–5.5% per year. The country’s young population, infrastructure push, and rich natural resources make it a highly attractive market.
The old plant outside Jakarta suffered from inefficiencies, with parts moving 16 km along the line. In contrast, the new plant at Cikarang Industrial Estate completes production in just 0.8 km—reflecting modern, lean manufacturing.
Construction began in February 2024 and was completed in just 12 months—a feat that even surprised the Indonesian government. Agus Gumiwang Kartasasmita, Minister of Industries, quipped, “I thought only the Chinese could do that so fast.”
Forward Outlook: Focused and Future-Ready
While Daimler Truck sees potential across multiple commercial vehicle categories, it has no plans to enter the light commercial vehicle (LCV) space. Arya clarified that the LCV segment is extremely cost-sensitive, which doesn’t align with Daimler’s brand DNA.
Instead, the company is focused on preparing for electric and hydrogen trucks. Trials are already underway, including a fuel-cell intercity coach in collaboration with the Indian government.
To support its global vision, Daimler Truck is also strengthening its Global Capability Centers in India, expanding their roles in cross-functional activities to support both the Indian and Southeast Asian markets.
Future-Focused CV Ecosystem
With this strategic plant launch in Indonesia, powered by the proven capabilities of India’s BharatBenz and DICV, Daimler Truck is creating a resilient, efficient, and globally connected manufacturing ecosystem. The collaboration between Germany, India, and Indonesia exemplifies a modern, multi-hub growth strategy designed for scalability, sustainability, and regional dominance in the commercial vehicle segment.
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