Dieter Zetsche, Daimler’s chief executive, will step down in 2019 as the German carmaker responds to upheaval in the automotive market and sets the stage for its own 2020 restructuring. The parent of brands including Mercedes said on Wednesday that Mr Zetsche, who has led Daimler since 2006, would be replaced by Ola Kallenius, a board member who oversees research and development. Daimler said the change of management was in response to “challenges presented by the transformation of the automotive industry”. Carmakers are under pressure to electrify their fleets, invest in autonomous driving and connect cars to the web to make them “iPhones on wheels”. New entrants, from Tesla to Google, have scared off investors and placed carmaker valuations at recession-era levels. Mr Zetsche is planning on returning to the carmaker after a two-year “cooling-off period”, when he will take over the chairmanship of the supervisory board from Manfred Bischoff, whose contract expires in 2021. At German companies, supervisory boards hold management to account. Mr Zetsche is departing six months earlier than previously expected — next May instead of at the end of 2019. His early departure indicates Daimler is anxious to have new people in place for the restructuring it announced in July, which is set to begin in January 2020. Daimler is splitting up Mercedes-Benz cars from Daimler Trucks and its financial arm, then placing the three divisions under the Daimler AG umbrella. Daimler: change at the top “It’s a very smart move, it’s well-planned, it’s a smooth transition,” said Christian Ludwig, analyst at Bankhaus Lampe. “You look at Volkswagen earlier this year with Diess and Müller — it was the complete opposite.” In April, VW’s chief executive Matthias Müller was abruptly ousted, with Herbert Diess, head of the VW passenger car brand, taking his role with immediate effect. It is common in Germany for longstanding chief executives to hand over to a successor but then take on the chairman role. Ferdinand Piëch, who led VW from 1993 to 2002, for instance, retired but soon took on the chairman role for another 12 years. At chemicals groups Linde, a similar scenario played out for Wolfgang Reitzle when he stepped down in 2013. Mr Zetsche, who was born in Istanbul, has spent four decades with Daimler and been a board member since 1998. He is known to Americans as “Dr Z” for a series of humorous commercials he appeared in when Daimler merged with Chrysler. That alliance is considered to have been a disaster, and one of Mr Zetsche’s earlier tasks was to demerge. He then set Mercedes on a path that would see it rebound strongly from the financial crisis and overtake BMW as luxury sales leader. Recommended The Big Read Patrick McGee Carmakers take electric fight to the factory floor Since the VW diesel scandal three years ago, however, Mercedes has come under scrutiny for its own role in gaming emissions tests. In June, it was forced to recall 774,000 vehicles equipped with “prohibited [emissions] shut-off devices” — but it avoided any fines. It still faces lawsuits from car owners in the US. Max Warburton, an analyst at Bernstein, said: “Mr Zetsche can be given credit for a number of achievements. Most notably he extracted Daimler from Chrysler just in time in 2007 and then he rebuilt Mercedes’ product line, brand and Chinese business through this decade.” However, he added: “The relationship with investors was often a bit frustrating. Quite a lot got lost in translation . . . But everyone respected him and no one can argue with the post-2012 track record.” Mr Kallenius was promoted to his R&D role in 2017 and was widely seen inside Mercedes as favourite to succeed Mr Zetsche. Mr Kallenius has spent most of his career at Daimler, starting in 1995. From 2003 to 2005, he was a director of McLaren Automotive in the UK. This article has been amended since original publication to reflect the fact that Dieter Zetsche will step away from the company for two years, rather than immediately taking up a position on the supervisory board
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