Daimler to invest over EUR 300 mil to build transmissions plant in Romania

Article by Anita Panait, on April 26, 2013

Daimler AG will make an investment of over EUR300 million ($390.6 million) to build a new plant in Sebes, Romania, that will assemble transmissions for its Mercedes-Benz brand. The carmaker needs a new transmissions plant after its main powertrain plant near Stuttgart, Germany has already reached full capacity.

Daimler will commence producing five-speed automatic transmissions in mid-2013 at the Sebes plant, which is close to an existing components site in Cugir.

Daimler said that the new site will commence production dual-clutch transmissions in 2014 and will add capacity for its next generation of drivetrains in 2016. Daimler, which has been producing components for engines and transmissions in Romania at a joint venture since 2001, is increasing its production capacity across Eastern Europe as its Mercedes-Benz brand expands its lineup of compact cars.

Daimler launched a EUR800-million car assembly site in 2012 in Kecskemet, Hungary, where it builds the Mercedes-Benz B-class and CLA compacts. Daimler chief executive Dieter Zetsche is aiming to have Mercedes regain the crown as the best-selling luxury car maker in the world by the end of the decade as well as increase the unit’s operating margin to 10 percent of sales

Mercedes-Benz Cars division, which includes the Smart minicar brand posted a 63-percent drop in earnings before interest and taxes in the first quarter of 2013 to EUR460 million, resulting in a 3.3 percent margin. Further development of Daimler’s Sebes plant is now subject to support from the Romanian government. Daimler said it was not able to expand transmission production at its plant near Stuttgart due to space constraints.

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