The supervisory board of Daimler AG voted to extend the contract of Dr Dieter Zetsche, chairman of the board of management of Daimler AG and head of Mercedes-Benz Cars, until the end of 2016 – two years short of the five-year extension he was widely expected to earn.
International reports suggest Zetsche’s shorter-than-anticipated contract extension is a reflection of the frustration of the board and major stakeholders in Mercedes-Benz’s recent performance, however sources close to Daimler say the decision was related to Zetsche’s age, with the CEO set to turn 60 in May.
Earlier this month, Daimler warned its earnings would stagnate this year due to continuing economic gloom in Europe and recent hardships in China.
Reuters reports Daimler’s stock has risen just over two per cent since Zetsche took the reins in 2006 while shares of rival BMW have almost doubled in the same time.
The supervisory board also announced a three-year contract extension for Daimler research and development boss Dr Thomas Weber, which will likewise see the 58-year-old retain his position until at least the end of 2016.
Daimler AG supervisory board chairman Dr Manfred Bischoff said continuity in leadership at the top executive level was considered essential to the company’s future success.
“Dieter Zetsche and the board of management have a clear plan how to further enhance Daimler’s overall performance together with their team,” Bischoff said.
“Dieter Zetsche is distinguished of course by his great experience, but also by his ability to combine a feeling for cars with sound engineering knowledge and an entrepreneurial approach.
“Research and development are two key areas in the automobile industry. I am therefore delighted that we will continue the successful collaboration with Thomas Weber. He will steadily continue to maintain Daimler’s claim to technological leadership.”
Mercedes-Benz is at the beginning of a bold expansion plan that will see 13 new models introduced to the line-up by 2020. The A-Class hatchback, CLA-Class sedan and GLA-Class crossover are set to play a significant role in the brand’s planned resurgence in the short term.