With the cost to develop new light vehicle platforms easily surpassing $1 billion, it is no surprise that major automakers are forming cooperative ventures to reduce the costs. The bigger the volume, the more sense this makes and in terms of product volume, there are fewer bigger global segments than pickup trucks. Mercedes-Benz, notable for the firm's lack of an entry in this segment has addressed this gap with a newly expanded five-year strategic deal with the Renault-Nissan Alliance.
Shared architecture with Nissan
The Mercedes-Benz pickup will share some of the architecture with the all-new Nissan NP300 but it will be engineered and designed by Daimler to meet the specific needs of its customers. The vehicle will have Mercedes Benz’ specific characteristics and features.
The pickup will feature a double cab and will be targeted both at personal-use and commercial customers. The primary target markets for the truck are Europe, Australia, South Africa and Latin America.
“Mercedes-Benz is the fastest growing premium brand in the world,” said Dr. Dieter Zetsche, Chairman of the Board of Management of Daimler AG and Head of Mercedes-Benz Cars. “Entering the rapidly growing segment of midsize pickups is an important step in continuing our global growth path. Thanks to our well-established partnership with the Renault-Nissan Alliance, we are able to drastically reduce the time and cost to enter this key segment.”
Nissan is the world’s second-biggest 1-ton pickup truck maker and has been building and selling 1-ton pickups for more than 80 years. Since 1933, more than 14 million Nissan 1-ton pickup trucks have been sold worldwide. The NP300, sold under the name NP300 Navara and NP300 Frontier (depending on the market), was launched in June 2014 and is currently produced in Thailand and Mexico.
Nissan and Renault are already developing a 1-ton pickup truck for Renault which will also share some common architecture with the Nissan NP300. The truck, which will have a distinctive Renault design, is Renault’s first 1-ton pickup truck as well. Production of Renault’s 1-ton truck will begin in 2016 at Nissan’s plant in Cuernavaca, Mexico. The 1-ton pickup will mark Renault’s second entry into the pickup segment after the launch of a half-ton pickup later this year.
Everywhere except North America
The Mercedes-Benz 1-ton pickup truck will be built by Nissan in the Renault plant in Cordoba, Argentina, along with the Nissan NP300 and the Renault 1-ton truck, for Latin America. The three trucks will also be built in the Nissan plant in Barcelona, Spain, for other markets, excluding North America. Production of the trucks at the two plants will start by the end of the decade.
The Barcelona plant will produce about 120,000 vehicles annually for the three partners, while the Cordoba plant will produce nearly 70,000 vehicles a year. A high parts localization rate is expected to expand the supply bases in Spain and Argentina significantly.
“Thanks to our cooperation with Daimler on this project, we will be able to share the cost of investment at the Cordoba plant, while at the same time open up new markets in the Latin American region for the Renault-Nissan Alliance,” said Carlos Ghosn, Renault-Nissan Chairman and CEO. “This project will also allow us to optimize production capacity at the Barcelona plant and enhance our competitiveness in an important segment.”
The joint pickup project is the latest milestone in the strategic partnership between Daimler and the Renault-Nissan Alliance, which celebrates its 5th anniversary this month. The strategic cooperation among the three companies began on April 10, 2010. At the time, the scope of the collaboration was limited to three projects primarily focused on Europe. Since then, the combined portfolio shared between Renault-Nissan and Daimler has more than quadrupled to 13 projects in Europe, Asia and the Americas.
“After five years of cooperation between Daimler and Renault-Nissan, my conclusion is by all means positive,” Zetsche said. “We have identified and launched many joint projects that create benefits for all partners involved.”
“This cooperation is one of the most productive in the auto industry, enabling all partners to increase economies of scale while keeping our brands and products distinct,” Ghosn said.
A US pickup in the works?
Highly significant is the absolute lack of any mention of the North American market. Pickup trucks are major sellers and in the US frequently outsell passenger cars for personal use. Ford for example, has spared no expense in re-engineering the firm's F-150 line using an all aluminum structure, something formally reserved for the most expensive luxury sedans and sports cars. Pickups are not only high-volume, they're high-margin and Mercedes-Benz dealers in the US have informally been asking for an entry into the segment for years.
If Daimler decides to adapt to new vehicle for the US market, it will have to be "civilized", with much of the heavy duty equipment necessary for rough use in global markets softened for the suburban grind. Access to the US market could easily be addressed through the Mexican operations. The real question is, is there a market for a premium luxury pickup truck in the US? GM and Ford through their Cadillac and Lincoln brands have both taken a shot at the segment, and both missed the mark widely. Could a Mercedes branded pickup win where other luxury brands have faltered? Possibly. Unlike Lincoln and Cadillac, Mercedes Benz branded heavy trucks of a global reputation for durability, a factor which could be marketed alongside the firm's luxury car credentials. And in affluent US markets, a luxury vehicle with serious towing capacity, combined with advanced common rail diesel engines could pose a credible threat to the Detroit Three's high-end pickup offerings.
It is possible that the joint venture is strictly about serving a global market for light utility vehicles for commercial use in global markets, but the high-margin cherry that is the US pickup truck market must be in the cross hairs at Daimler's US marketing arm. Do not be surprised if a US announcement follows shortly.