DTNA president Roger Nielsen does not expect NAFTA, GHG changes

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Fleet Owner  /  May 19, 2017

MADRAS, OREGON. The new president and CEO of Daimler Trucks North America (DTNA) said he does not expect any shake-up of the North American Free Trade Agreement (NAFTA) or Phase 2 greenhouse gas rules.

 “I don’t anticipate any major changes in the NAFTA trade agreement,” said Roger Nielsen. “I think there are so many other discussions going on with government priorities right now, I don’t see this as coming up to the top of the list.”

Nielsen made the comments during his first roundtable with reporters since being elevated from chief operating officer on April 1. He was in Madras to officially open DTNA’s new test track.

President Trump previously threatened to withdraw from NAFTA, but more recently indicated a desire to renegotiate certain terms of the deal with Canada and Mexico.

“We’re a global company,” said Nielsen. “We believe in free trade, and we’re prepared to engage anybody and everybody in discussions about what that means,” he said.

Nielsen added that in the event there was a shift in trade policy, the company would be prepared. “If you take the worst case scenario and say there was a situation where we would be required to have 100 percent . . . assembled in America, we have the capacity to do it.”

He added he is confident the company’s component suppliers would be ready as well.

His message was similar when asked about the Phase 2 greenhouse gas regulations, with implementation scheduled to begin January 2018.

He said cooperation between industry and Obama administration created a path over the next decade to not only reduce emissions, but make 10 miles per gallon in a diesel truck a regular occurrence.

“We don’t see that changing. At the moment, there has been no discussions about changing it,” he said.

Nielsen joined Freightliner, now DTNA’s parent company, in 1986, and has been COO since 2001.

Though Nielsen has not regularly interacted with the media during his career, he was clearly at ease as he addressed a wide range of questions for more than 35 minutes.

He said the Daimler leadership transition, starting with Wolfgang Bernard’s decision to resign as head of the global commercial vehicles unit earlier this year, was a “surprise.”

He said Daum moving into that role  “reflects the achievements we have been able to have here in North America.”

Nielsen was “absolutely in shock” when Daum offered him the top position at DTNA, and humbly joked he is likely “to get credit for a lot of things Martin put in place.”

As COO, Nielsen had regular interactions with maintenance executives. Now, as CEO, those discussions are more with the top decision makers of fleets that purchase Freightliner and Western Star trucks.

That started with a 13-customer blitz in 13 different cities over five days, he said.

Besides maintaining DTNA’s position as “the on-highway leader,” he said one goal is to become top seller in the vocational space.

As for the current market, he reiterated DTNA’s earlier sales projection of 350,000 for Classes 6-8 for the NAFTA market this year.

Incoming orders reflect a more equal mix between the largest fleets and smaller ones.

Many of the large firms went on a buying spree over the past few years, bringing their average fleet age down.

Nielsen said customers in the dry van sector are struggling to get rate increases from shippers due to intense competition. Combined with slipping prices on the used truck market, some fleets “not so eager to freshen up their trucks,” which may still be under warranty and running well.

Customers waiting for the full range of next generation Cascadia models are also impacting current order intake, he suggested.

Nielsen declined to respond when asked about Elon Musk’s suggestion Tesla will unveil a long haul electric Class 8 truck in September, other than saying “it is an interesting company to watch.”

As for the overall electric truck market, he said there continues to be advances in electric battery power, and it likely makes sense for light-duty vehicles and short hauls.

After declaring Daimler plans to be the leader in the electric commercial vehicles space, he questioned if the technology and related infrastructure will be ready in the near-term to allow long haul truckers, who try to avoid stopping, to experience “a drive like he does today, without energy insecurity.”

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New DTNA Chief Roger Nielsen Says GHG Rule Will Stick

Transport Topics  /  May 19, 2017

MADRAS, OREGON — Fleet owners should not expect the truck and engine sections of the federal Phase 2 rule on greenhouse gas emissions to change before implementation starts in 2021, said Roger Nielsen, the CEO of Daimler Trucks North America.

Speaking to reporters and editors at a company event here May 18, Nielsen gave credit to the Obama administration for developing the complicated rule in a logical fashion.

“We did a great job with the previous administration to produce a doable, viable rule within the realm of technological possibilities — and I don’t see that changing,” said Nielsen, who has been CEO of North America’s largest truck maker since April 1.

Although the Trump administration has been searching for Obama-era regulations to rescind or modify, Nielsen said GHG Phase 2 lays out an orderly but challenging long-term path to lower carbon dioxide emissions that will be accomplished by building more fuel-efficient trucks.

In his first press conference since succeeding Martin Daum as CEO, Nielsen also spoke about North America’s heavy-duty truck sales market and his promotion from chief operating officer. He spoke in conjunction with DTNA’s opening of its new High Desert Proving Grounds test facility.

In the Daimler AG first-quarter report released in April, DTNA’s parent company forecast growth in both the world and U.S. economies. Despite that, the prediction for North American Classes 6-8 sales this year was for flat versus 2016 or a continuing dip.

While truck makers always welcome an expanding economy, Nielsen said traditional production cycles now are doing more to influence sales.

“2015 was a peak for sales, and all of that buying brought down the average ages of trucks for fleets,” Nielsen said, adding that most of those 2105 trucks still are in good shape.

Most of the DTNA Freightliners and Western Star trucks traded in now are from 2012 and 2013, he said. When it is time for the 2015s to be traded in, that should boost sales significantly.
Nielsen said that refrigerated and flatbed carriers are ordering more now, but the large dry van, truckload segment is not as prosperous.

An Oregon native, Nielsen started with DTNA in 1986 and has been chief operating officer since 2001.

The executive ladder within Daimler changed earlier this year when Wolfgang Bernhard left suddenly as head of Daimler’s global trucks division. Daum was brought home by Daimler to succeed Bernhard, and one of Daum’s first decisions was to promote Nielsen as his successor.

Nielsen, who has a commercial driver license and has been known to drive a Class 8 tractor to his eye doctor, noted a change because of the promotion.

“I now understand that my opinion counts,” he said. After observing offhandedly that he didn’t care for a company tweet, “I went back an hour later to look for it, and it was gone.”
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Daimler chief unfazed by NAFTA talk

Today’s Trucking  /  May 19, 2017

MADRAS, OREGON – Roger Nielsen, the recently named president and Chief Executive Officer of Daimler Trucks North America, doesn’t seem concerned by talk about renegotiating the North American Free Trade Agreement – even though its manufacturing footprint includes Mexico.

“We’re a global company, and globally we believe in free trade. And we’re prepared to engage everybody and anybody in discussions,” he said during his first media briefing. “I don’t anticipate any major changes in the NAFTA.”

The company has reserve manufacturing capacity in the U.S. and Mexico, he noted. The supply chain is also dual-sourced. “They have the ability to source worldwide or source domestically.”

Daimler's global presence was recently punctuated when Nielsen’s predecessor, Martin Daum, was promoted to lead Daimler Trucks and Buses worldwide. Then Nielsen received the call that put him in his current role.

“I was absolutely in shock,” he says. “I never really thought that would be the next step in my life.” But he earned the role, and there have been several executive promotions at the company since, many of which were set up by Daum.

Nielsen himself served as the company’s Chief Operating Officer since 2001. And he clearly likes to keep in close touch with staff and products alike. He often grabs a truck on display in front of the company’s corporate headquarters to head out for lunch. And he makes random calls to the call center to see if the answers align with corporate approaches.

Aspects of his previous role will undeniably influence the work he does today. “I bring in a view of being responsible for product quality,” he says. “Quality in the factory is service quality.”

But the role of president and Chief Executive Officer is undeniably different. “I now understand my opinion counts,” he says, illustrating the comment by referring to a Tweet he questioned. He just made a passing reference to it, but the next time he went back to read it, it was already gone.

Daimler clearly has set its sights on a 40% market share, and it is a leader in on-highway truck sales. But the potential for a bigger market overall is dampened somewhat because major buyers have “fresh fleets”, with average equipment ages under 24 months.

“Used truck pricing is not like it was two years ago, three years ago, four years ago,” he adds. Those who have equipment with plenty of miles left are more likely to stick with what they have.

Some customers are also holding back purchases as they wait for different configurations of the next-generation Cascadia. That rollout is scheduled to be complete in mid-2018.

“We have some great products yet in our pipeline,” he adds, alluding specifically to vocational models that are in the works. “We have engineers who love to design trucks.” Look at the piles of dirt, he said, pointing to the surrounding High Desert Proving Grounds. It needs to be moved.

Fuel economy also remains a central focus. “For sure, we are promising better fuel economy year over year,” he says, adding that he’s confident the second phase of Greenhouse Gas emissions standards will remain in place. The tools to meet the cleaner emissions are all technologically viable and doable.

Consider the difference realized by Automated Manual Transmissions. About 95% of all new Cascadias come with those. There was a time not long ago when many people thought of that as a niche technology, Nielsen observes.

As for Tesla’s plans to introduce and electric Class 8 truck by September? “It’s interesting to watch,” he says, referring to gains in battery power density as well as the cost per kilowatt hour. But there is still the challenge of long-haul drivers who don’t want to stop for frequent charges. “Daimler is the leader in electric vehicles. We’re the leader in battery technology,” he says. “We will be ready when the market is ready, if it ever comes."