DEUTZ and Rolls-Royce’s Power Systems Business Unit recently reached a general agreement on the takeover by DEUTZ of sales and service operations for various industrial engines in the 5 to 16-litre range with a maximum power output of up to 480kW. Subject to final agreement, DEUTZ is taking over the distribution of the mtu Classic series and the mtu engine series 1000-1500, which are based on three Daimler Truck engine platforms.
The engines are used in various off-highway applications, including in mining in applications like surface ADT trucks, as well as underground trucks, loaders and drills. In addition, DEUTZ is taking over the service operations for engines that are already in service.
Earlier this year, DEUTZ entered into a cooperation with Daimler Truck to develop and market medium- and heavy-duty engines (MDEG and HDEP platforms) in the off-highway segment, which is scheduled to begin in 2028. With the agreed takeover of the sales and service operations from Rolls-Royce Power Systems, DEUTZ is now taking over the marketing of the off-highway variants of these engines from 2024. In addition, the agreement includes the distribution of the older mtu Classic series (Daimler Truck engine series OM900 & OM460).
“With the takeover of the sales and service operations from Rolls-Royce Power Systems, we are taking the next major step towards growth in our business with modern internal combustion engines,” said DEUTZ CEO Dr Sebastian C Schulte. “This is an important element that will help us play an active role in the consolidation of the market.”
The takeover DEUTZ says provides further evidence of success in implementing its Dual+ strategy, which aims to boost the development of a green product portfolio and at the same time optimise and further develop conventional engines. When the strategy was presented in January 2023, the company announced that it intends to firmly establish DEUTZ among the top three independent drive manufacturers – including through acquisitions and cooperations.
DEUTZ CTO & CSO Dr Ing Markus Müller explains: “With the earlier access to the engine platforms, we can offer existing and potential customers a much better approach for the transition. Customers gain planning security and we benefit from faster market access.”
After the conclusion of the agreement, DEUTZ expects additional revenue of around €300 million per year with an EBIT margin exceeding the current group margin. The expected purchase price for the engine portfolio is a high double-digit million Euro amount. Following a final agreement, the closing – subject to regulatory approvals – is expected from mid-2024.