DTNA Starts AMT Production, Announces Engine Investment

REDFORD, Mich. — Daimler Trucks North America celebrated the production launch of its Detroit-branded DT12 automated manual transmission here while simultaneously announcing a $375 million investment to bring its new medium-duty diesel engines to the United States over the next two years.

Daimler executives from Germany and the United States were joined by Michigan Gov. Rick Snyder, congressional representatives and nearly 2,000 United Auto Workers on Nov. 20 at the suburban Detroit plant for the event that was as much about the rebirth of a city as it was about the products that share the name.

“This is a special day for Detroit,” said Wolfgang Bernhard, head of Daimler’s global truck and bus division.

And it came nearly three years after President Obama toured the same facility and DTNA announced its intention to make transmissions outside of Germany for the first time. Then, the company invested $100 million and created 170 new jobs to make it a reality. It also included a new turbocharger assembly line. Initially, the plant will produce about 120 per day.

“Our investment is a tangible example of how we maximize the use of our global platforms optimized for regional markets,” Bernhard said.

DTNA President Martin Daum said in March that the company already had booked all 44,000 production slots planned for the DT12 for 2015.

Previously, all truck transmissions were produced at a plant in Gaggenau, Germany. The heavy-duty AMT is available on the Freightliner Cascadia and Western Star 5700XE models. About 40% of orders include the DT12, a figure far higher than initially expected and likely to keep growing.

The event’s focus also was to draw attention to the progress being made in Detroit, which was among the cities hardest hit by the recession and faced near collapse of the U.S. auto industry.

“The future did not look quite this bright a few years ago,” said Jeff Allen, who oversees operations at the Redford plant that employees about 2,600 people.

Snyder praised the workers for being “role models” for Detroit.

“We’re growing and flourishing because of our ties with and connections with Germany,” Snyder said of Daimler’s investments.

U.S. Sen. Debbie Stabenow and U.S. Reps. Debbie Dingell and John Conyers also were present.

The loudest ovation during the hourlong event was for Roger Penske, who in 1988 created Detroit Diesel Corp. as part of a joint venture with General Motors.

Penske management helped Detroit Diesel boost its heavy-duty engine market share to 33%, when DaimlerChrysler purchased Detroit Diesel in 2000, from about 3% in 1988.

Penske, who said he controls about 230,000 trucks through his logistics, leasing and dealership businesses, let it be known just how highly he believes in the DT12 transmission.

“I don’t think today many people realize how important that is,” he said. “We probably will not order a heavy-duty truck without a DT12 in it. It is that important. It’s going to mean a lot for residual value going forward.”

In recent years, several truck manufacturers have been pushing a vertical integration strategy. In Daimler’s case, the powertrain brings together Detroit engines, transmissions and axles. Likewise, Swedish counterpart Volvo Group makes engines and transmissions in the United States for its Volvo and Mack trucks.

DTNA first announced in October 2014 that it would produce the DD5 and DD8 medium-duty engines. At the time, Daum said the engines would be exported from Manheim, Germany, starting in 2016, with North American development expected in 2018.

The DD5 and DD8 lines will add about 160 new jobs here and meet 2017 greenhouse-gas standards.

The DD5 is a 4-cylinder engine that is based on an existing model used in Mercedes trucks in Europe. Though the company has not yet provided horsepower and torque ratings, Bernhard said it is powerful enough for some fleets to consider moving away from a 6-liter engine.

“I think our customer base will be overwhelmed to see what a modern medium-duty engine is able to deliver,” Frank Reintjes, head of Daimler’s global powertrain division, told Transport Topics. “We are really convinced that this will be another milestone.”

For the first 10 months of this year, DTNA had U.S. retail sales of 38,359 Classes 6-7 trucks, a 40.7% market share, according to WardsAuto.com.

DTNA has not previously offered an in-house medium-duty engine, and moving forward, Daum said, the company will continue to provide customers the option of a Cummins Inc. engine, much as it offers choices for heavy-duty engines as well as transmissions and axles.

Though the DD5 will be offered starting in 2016, the larger DD8 likely will not be available until 2017.

The company anticipates full production to shift to the plant here in 2018, mimicking the just-completed transition with the transmissions.