Daimler Truck names Radstrom CEO as demand deteriorates

Daimler Truck Holding AG named Karin Radstrom as its next chief executive officer, as the German truckmaker races to tackle deteriorating demand.

The manufacturer is considering expanding its use of the government short-time work program to allow it to cut production as it adapts to lower volumes, Joe Kaeser, chairman of the supervisory board, said on a call with journalists Thursday.

Radstrom will take up the role next month so that she can immediately start work on ways to deal with “clear weakness” in Europe and help shape next year’s budget, Kaeser said.

“We are also expecting demand to continue to weaken and measures will then have to be agreed on how to deal with this temporary market weakness in a cost-effective and considered manner,” he added.

Radstrom’s task will be to steer Daimler Truck through the turmoil, which is affecting vehicle makers across Europe. The manufacturer has put some employees in Woerth into short-time working, where the government pays part of workers’ salaries as companies eliminate shifts and work hours in line with a drop in demand.

The company is “currently in the process of taking a closer look at the current program situation at the other locations,” Deputy Chairman Michael Brecht said on the call.

Radstrom has agreed to run Daimler Truck through January 2029 and succeeds Martin Daum, who will remain a management board member until the end of this year, the company said in a statement Wednesday.

The 45-year-old will be able to serve for a number of years because of her relatively young age, which was an important factor in the selection, Kaeser said. “We think that the transformation of the industry — from combustion to hydrogen, to battery electrics, to changes in the service business model, which goes hand-in-hand with the technology — will take longer than 4 to 5 years,” he said.

It’s a rare appointment of a woman at the head of one of Germany’s top listed companies. Radstrom will become just the second female CEO of a DAX 40 firm, joining Belen Garijo, the head of pharmaceutical giant Merck KGaA. While Germany has an international reputation for being progressive on gender parity, the country has one of the largest male-female pay gaps in Europe.

Radstrom, a former elite rower who competed internationally for her native Sweden, joined the Daimler Truck board in 2021 and has since been responsible for Mercedes-Benz Trucks, where she’s been credited with improving customer service.

During Radstrom’s tenure, Mercedes-Benz Trucks saw its profit margins rise, even as it invested heavily in the transition to zero-emission trucks. The company is betting on both hydrogen and battery-electric models as the eventual alternatives to combustion engines.

Radstrom rose to prominence at Scania CV AB, Daimler Truck’s Swedish rival. Insiders often point to her popularity among employees, her consensual management style and her focus on the shift to zero-emission logistics.

Her appointment comes at a turbulent time for Germany’s industrial sector. Rising interest rates and higher energy prices since Russia’s invasion of Ukraine are squeezing capital investment budgets, making it harder to invest in new assets like trucks.

A worsening shortage of skilled engineers — a result of a demographic crisis that’s developed over decades — is also increasing the cost of producing in Germany.