Daimler AG Chief Executive Dieter Zetsche said the German auto maker will be participating in the global light-pickup truck market by the end of 2017, with the company's Mercedes-Benz unit becoming the latest premium brand to try expanding into a segment that traditionally appealed to blue-collar buyers.

Mr. Zetsche, speaking in Stockholm on Tuesday in a webcast presentation, said the auto maker is eager to fill a hole in its lineup with a midsize truck that is smaller than the big pickups popular in the U.S. He said the midsize pickup truck segment is poised to increase 40% by 2025 and is among the "most attractive targets" in the world.

The auto maker expects buyers to be more accepting of the pickup body style as an everyday-use "lifestyle" vehicle due to advances in engineering that make them more comfortable, increased efficiency and carry more carlike attributes, Mr. Zetsche said.

Daimler had earlier outlined plans to joint-develop a pickup truck with the Renault SA/Nissan Motor Co. alliance, and had shown sketches of the vehicle. Mr. Zetsche's presentation included two brawny "X-Class" concept trucks intended to show the company's attempt to blend the company's luxury heritage with a pickup truck's rugged stature.

While General Motors Co.'s hulking Chevrolet Silverado or Ford Motor Co.'s F-150 are held up as iconic pickups, they are most popular in the U.S. and not representative of what most markets demand. The non-U.S. pickup market is far more fragmented than the U.S. pickup sector because most full-scale auto makers have smaller units sold in markets outside the U.S., including Volkswagen AG and Ford.

Daimler officials said its X-Class pickups—which are about the size of a Honda Motor Co. Ridgeline sold in the U.S.—will initially be sold in Latin America, Australia, South Africa and Europe. No plans have been set for the U.S. even though the midsize pickup truck in America is enjoying resurgence as several new models hit the market amid low gasoline prices and a move away from the passenger cars that Mercedes is known best for. GM recently relaunched its midsize trucks, and Ford will reintroduce its Ranger to U.S. buyers in coming years.

Mercedes' foray into light pickup trucks follows moves by U.S. luxury brands into the segment in recent decades.

Ford's Lincoln division once sold a pickup called the Blackwood, but a high price tag and limited functionality led to a quick demise. Lincoln again attempted to revise the luxury pickup truck idea a few years later with the Mark LT, but that also failed.

GM's Cadillac brand also sold a pickup truck variant called the Escalade EXT, which combined the cabin of an SUV with a pickup bed. Since killing the Caddy truck, GM has designated the GMC brand as the premium division for pickup trucks.

Trucks can command a hefty premium, with the most capable and luxurious of models selling for nearly $80,000. Mr. Zetsche saw the potential of the pickup market during his years in the U.S. when he ran Fiat Chrysler Automobiles NV's Chrysler division when it belonged to Daimler.

Daimler has had success on several projects related to heavier trucks and capable SUVs. It has long built the Gelandewagen, or G-Class, a rugged sport-utility vehicle built to drive to remote locations and compete against Land Rovers or Toyota Motor Corp.'s Land Cruisers.

Daimler also owns one of the largest heavier truck-making operations in the world, which includes the Freightliner brand and Western Star brands.

Write to John D. Stoll at john.stoll@wsj.com

 

(END) Dow Jones Newswires

October 25, 2016 17:55 ET (21:55 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
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