How Daimler is dealing with the COVID-19 pandemic

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What’s “normal”, anyway?

The year 2020 is only half over, but by now it’s already quite clear which topic will dominate our end-of-the-year reviews in December. The spread of a novel coronavirus has turned our lives upside down in ways we could not have imagined just a few months ago. At Daimler as well, many things have changed because of the COVID-19 pandemic: A chronology of work interruptions, social distancing rules, and everyday mask wearing.

In recent days there’s been a lot of talk about the new normal. Even though probably no one can explain exactly what this term means, everyone seems to realize that it’s a verbal catch-all for all the things that have temporarily become routine aspects of our daily lives because of the COVID-19 pandemic.

For example, it’s part of the new normal to cover our noses and mouths with a facemask when we’re shopping at a supermarket or not to shake hands with people when we greet them. Speaking about hands: Some people also consider it part of this new normal to hum Happy Birthday when standing in front of a sink. According to the World Health Organization (WHO), if you hum this classic tune twice while washing your hands you can be sure you’ve been doing it for the recommended minimum of 20 seconds.

This short list of new normal behaviors certainly makes no claim to being complete. However, it’s fairly certain that in the upcoming competitions for titles such as Word of the Year 2020 and Non-word of the Year 2020, the term new normal could be a front runner. In fact, this neologism has the potential to win in both categories, because it can be used in two different ways: Either as a hopeful synonym for the idea that life can go on even in coronavirus times. Or as the sobering conclusion that things have to go on somehow in spite of the pandemic and the limitations it has imposed on us. The way you categorize new normal yourself probably depends on your personality — and for many people it certainly depends at least partly on their mood on any given day.

Daimler’s Head of Security remembers: It all started harmlessly

This emotional roller coaster is understandable, because the need for this kind of new normality overwhelmed us very suddenly. Even acknowledged experts did not recognize the first signs of the pandemic until they were looking at them in retrospect. The first hint that the year 2020 would be different from every other came on the last day of 2019. While people all over the world were — naturally! — hugging to wish each other a happy new year on December 31, 2019, the WHO was being informed that a striking increase of lung infections of unknown origin had been noted in the Chinese metropolis of Wuhan. One week later, it was clear that a novel coronavirus, which was later named Sars-CoV-2, was the cause.

Sabine Wiedemann first heard about this novel virus at around the same time. She has been the Director of Corporate Security at Daimler for almost ten years. To put it simply, she and her team deal with matters that could potentially pose a threat to the Group. Viruses and the threats they can cause belong to their portfolio.

Sabine Wiedemann is Director of Daimler’s Corporate Security department. Viruses and the threats they can cause belong to her team’s portfolio.
Sabine Wiedemann is Director of Daimler’s Corporate Security department. Viruses and the threats they can cause belong to her team’s portfolio.

Just about every child knows that computer viruses can spread all over the globe within days. But for many people it’s hard to imagine that, thanks to worldwide flight routes, a virus disease can spread almost equally fast. However, no one has to tell Sabine Wiedemann anything about flight routes — she also worked for Lufthansa in the past. Nonetheless, in retrospect she says that she too initially regarded the pandemic as relatively harmless: “I remember us receiving the first information from China that a new virus might exist there. Initially this was not regarded as such a critical piece of information at all, even though such matters are of course monitored closely at our situation center. That’s part of our routine. After all, our job is to identify early on what effects this kind of message could have on our company.”

Late January: Daimler sets up a coronavirus task force

After the first coronavirus cases had been confirmed, Wiedemann recalls, the Daimler colleagues in China started to become very active. In early January there was already a small staff of pandemic experts at Daimler headquarters in Stuttgart who were supporting the local activities in China.

From the medical perspective as well, at that point there was still no reason to worry about a global threat. Dr. Martin Riedel is a specialized physician for internal medicine/nephrology and occupational medicine at Mercedes-Benz in Sindelfingen. He’s also a respected specialist for travel medicine, hygiene, and pandemic management. He remembers feeling a bit queasy when he heard in early January that a novel coronavirus was thought to be the pathogen causing this lung disease. “However, back then people assumed that things would develop the same way they did in 2003 with the first SARS virus. That was indeed a bad virus, but it could be locally limited successfully,” he explains. “Only after some time had passed did it become evident that the new coronavirus was significantly more infectious and that its transmission was much simpler. That’s why it started to spread all over the globe.”

Dr. Martin Riedel is a specialist for travel medicine, hygiene, and pandemic management and thus observes the coronavirus’ global spread from the medical perspective.
Dr. Martin Riedel is a specialist for travel medicine, hygiene, and pandemic management and thus observes the coronavirus’ global spread from the medical perspective.

The first reports about a possible person-to-person transmission followed in the course of the month. The first confirmed case of coronavirus in Germany was reported on January 27. It quickly became clear that Patient One in Germany had been infected during a training course that was also attended by a participant from China who had shortly before that been in contact with her parents, who came from Wuhan. On her return flight, she suddenly felt ill. This case hit the headlines, but the chain of infection could be identified and interrupted quickly. The situation seemed to be under control.

A few days before that, on January 23, initial information about the novel virus had been published on the Daimler Intranet. At the same time, the Group had also decided to appoint a coronavirus task force and to activate the Group’s crisis team led by Wilfried Porth, the Human Resources & Labor Relations Director.

Just a few hundred meters away from Daimler Headquarters, the stadium of the VfB Stuttgart soccer club is located. For their first league game after the five-week winter break, they played Heidenheim at the end of January. It was an important match for both teams, the Mercedes-Benz Arena was almost sold out, and the 52,585 spectators watched the game to its 3:0 finish. In the celebrations over the third goal, there was widespread hugging among the players on the field and the fans in the arena. The coronavirus seemed to be very far away. Social distancing was no big thing yet. At that point nobody suspected that sports leagues all over the world would soon be completely on hold again for weeks – unscheduled, this time.

At first only China was in the news — but suddenly Italy was too

At that point, Daimler’s corporate crisis team started to meet several times a week — virtually, on account of safety concerns. Dr. Annette Matzat is a permanent member of this team. She is responsible for the Labor and Human Resources Policy division at Daimler, which includes the teams for labor law, the Group’s health insurance fund Daimler BKK, and the Health & Safety unit. Many of the issues related to the coronavirus are automatically included in the sphere of responsibility of Dr. Matzat, who is a lawyer.

Dr. Annette Matzat is Head of Daimler’s Labor and Human Resources Policy division. Many of the issues related to dealing with the coronavirus are part of her sphere of responsibility.
Dr. Annette Matzat is Head of Daimler’s Labor and Human Resources Policy division. Many of the issues related to dealing with the coronavirus are part of her sphere of responsibility.

The permanent members of the crisis team also include representatives of Human Resources (HR), Corporate Communications (COM), and Corporate Security (CS). Depending on the issue, other corporate units are also called in – the business units Cars, Vans, Trucks, Buses and Mobility Services, including the units’ Sales and Production departments, Procurement, Transportation, Logistics, and the various service units such as Catering and Travel Management. As the situation became more and more serious, this group of participants visibly grew, because the coronavirus was increasingly affecting the Group as a whole.

At the crisis team’s first meetings, however, the main topic of discussion was still the situation in China. China is not only Daimler’s biggest sales market but also a country where the Group has thousands of employees and numerous locations, not to mention suppliers and their subcontractors. The situation there alone would easily have been enough to occupy the crisis team for weeks. Accordingly, the most urgent questions at the end of January read: What safety measures should we recommend to our colleagues in China? How should we handle business trips – not only those to China? How could supply chains be secured, and how could we find replacements for suppliers who were closed down? Specifically, how could components be transported to the places where they were needed, and what safety criteria applied to suppliers when they have to enter the premises? And of course, what were the best ways to protect our employees, business partners, and customers from infection?

These initial measures were successful. As a result, work at almost all of Daimler’s locations continued normally for several weeks. In other words, it was still the “old normal.” In Germany especially, for a moment it looked as though the situation was calming down. In early February there were 12 confirmed cases of coronavirus, but the patients did not show any severe symptoms and were receiving medical treatment. Three weeks later, the initial optimism turned out to be unjustified. The coronavirus, which we had thought was so far away, was suddenly very near. Italy was reporting that its cases were increasing by leaps and bounds. Quarantines had been imposed on entire villages in the Lombardy and Venice regions. And on a day with normal traffic it takes only six hours to drive from Stuttgart to Bergamo.

From that point at the latest, it was clear that the situation could become really serious everywhere in the world. The crisis team decided that Daimler employees returning from a region that the Robert Koch Institut (RKI) had categorized as a coronavirus risk area would have to initially work from home for two weeks, to be on the safe side. If working from home was not possible in their jobs, these employees would be furloughed for 14 days. Throughout the Group, employees would refrain from handshaking. In addition, the crisis team established a reporting procedure: Managers were required to report whether any of their team members had just returned from a risk area or had been in contact with an individual who had tested positive for COVID-19.

A reporting system helped to avoid infection within the Group

At this stage the information pages about the coronavirus on the intranet were updated on a daily basis. And they rank among the most frequently clicked pages. More and more managers were having to use the reporting procedure as COVID-19 rapidly spread. On March 5, the RKI declared that South Tyrol, where many German vacationers had gone for skiing during the Carnival week, was also a risk area. On March 11, the Alsace region of France, where many of the Daimler colleagues who work in the Mercedes-Benz plants in Wörth, Gaggenau, and Rastatt live, was also declared a risk area. Just two days later, Tyrol — the next popular vacation spot for skiers — was also put on the list.

During this period the first group of Daimler colleagues tested positive for the coronavirus. “This was unavoidable, of course,” says Martin Riedel, the plant physician. “However, we were able to almost completely avoid infection within the Group, because we were able to create an efficient reporting system in cooperation with Corporate Security. As a result, we were able to very effectively track the infected individuals’ contacts and their contact persons within the Group.”

Live on the Internet, but not live on stage: As the Geneva Auto Show was cancelled, the press conference with the world premiere of the new E-Class was presented via live streaming.
Live on the Internet, but not live on stage: As the Geneva Auto Show was cancelled, the press conference with the world premiere of the new E-Class was presented via live streaming.

The first set of events cannot take place because of the risk of infection. On February 28, the Geneva Auto Show was canceled just a few days before its planned opening. Everyone on the Mercedes-Benz event team pitched in to move the show from a trade fair center in Switzerland to a TV studio in Sindelfingen in only four days. The new E-Class was presented via live streaming, and there was lots of praise for the car as well as the presentation format. It soon also became evident that the Annual General Meeting could not be held on April 1 as planned. It was officially canceled by the Board of Management on March 13, a Friday, and is now planned as a virtual event to take place in July. On the very same day clear instructions were also issued to Daimler employees all over the world: They should work from home whenever it is possible. In this phase of the pandemic, this was an important step toward interrupting possible chains of infection. Mobile working had already been an option at Daimler for a long time — but suddenly it became Plan A for tens of thousands of Group employees.

In mid-March, Daimler interrupted production operations — a turning point

During these days in March, news about the virus came thick and fast. The members of the Group’s crisis team had been working solely on coronavirus issues for weeks. Almost every day there were new reports about the spread of the virus, new discussions about necessary measures, and new regulations that had to be quickly implemented within the Group. “These weeks were incredibly intense,” says Annette Matzat. “Everything was going on at once, everything was new and happening at an insane pace.” She also remembers her daily phone calls, late at night, with the Head of Security Sabine Wiedemann during the peak of the crisis.

On March 16, the first Monday after the home office regulation, more than 100,000 colleagues were working from home. The IT unit transported the needed hardware to the computer center in Frankfurt overnight, and the infrastructure was expanded almost tenfold so that every colleague could access the Daimler network from his or her Internet connection at home. But already at this time, the members of the crisis team suspected that the Group needed to take another decisive step: During the first two weeks of March the estimated reproduction number of the virus (R number) was hovering steadily between 2 and 3, sometimes even higher. This means that an infected individual was infecting between two and three other people on average. In order to slow down the pandemic, the R number must be reduced to less than one. Italy had already instituted strict exit restrictions. In Germany, such restrictions were also being seriously discussed. The national closure of schools and kindergartens in Mid-march caused massive changes in the lives of many people in Germany. Such restrictions had never existed before in the country’s younger history.

One day later, Daimler took the next step: That afternoon, the Group informed the public and the capital market that most of its production activities, as well as work in selected administrative departments, would be interrupted for two weeks. Within a few days, the Group switched into emergency mode. It was a tour de force. And it was a turning point that had been unimaginable only a few weeks before. The last regular workday at most of Daimler’s locations in Germany was March 20. The production plants in the Americas were also closed down one by one.

How would the Group deal with the shock to demand?

After the closures, the assembly lines weren’t the only things standing still. Social life as a whole had also come to an emergency stop. Everywhere in the world, people were urgently requested to stay at home, in some countries even exit restrictions were in force. Public institutions that were not regarded as systemically relevant had been closed down for the duration. Restaurants were only allowed to offer takeout meals; movie theaters, theaters, and discotheques were closed, and of course car dealerships also had to remain shuttered during the first peak of the COVID-19 pandemic.

The emergency braking maneuver that halted public activities naturally affected the Group’s crisis team as well, although it didn’t bring the team’s work to a standstill. On the contrary — no one could know how long these restrictions would be in force. However, as a globally operating group, Daimler perhaps had one decisive advantage: Because the crisis team had very closely followed the course and the consequences of the spread of the coronavirus in China, it had a good feeling for what consequences could be expected in other markets.

That’s why one of the most important tasks of the Board of Management and the crisis team at that time was to prepare the Group for a phase during which lower demand was to be expected because of the pandemic. In short, in the weeks ahead the Group’s goal was not to produce a massive number of cars without knowing when, or even whether, they could be sold. That had been exactly the Group’s problem during the financial crisis of 2008 and 2009. But it wouldn’t happen this time. And that’s why it was decided not to resume work at most Daimler locations after the two-week interruption. In Germany, Daimler applied for short-time work subsidies, thus safeguarding the Group’s financial strength.

“We had suffered a shock to demand because of COVID-19, and in some measure a crisis of confidence as well,” explains Ola Källenius, the CEO of Daimler AG and Mercedes-Benz AG. “To avoid producing cars that just end up standing in the courtyard and to prevent the very rapid reduction of our liquidity, we needed to interrupt production. Short-time work is reducing our financial burden. It’s a very, very important tool for us in Germany in situations where the market is subject to huge fluctuations.”

Already in April, Daimler CEO Ola Källenius made very clear that for the company the fight against the coronavirus will not be an excuse in the fight against climate change.
Already in April, Daimler CEO Ola Källenius made very clear that for the company the fight against the coronavirus will not be an excuse in the fight against climate change.

Even small successes are good for motivation

One drawback of this effective tool is the inevitable connection with a great deal of bureaucracy. Nonetheless, everything needed to happen fast. “Just imagine: We had to inspect the work time accounts and work regulations of well over 100,000 employees in Germany, check everything, and discuss everything with the Department of Labor. That was an extremely time-consuming task,” recalls Annette Matzat.

Nonetheless, the crisis team never reached a point where they were overwhelmed by their assignment. “We often had very controversial discussions — but it’s important to have them,” says Sabine Wiedemann in retrospect. “But I don’t remember having any serious doubts. Instead, our basic attitude was more of a We’ll make it. And the team’s positive and constructive attitude gave all of us an incredible amount of motivation and drive.” The team was also motivated by a number of welcome, though almost unexpected, successes. The mask taskforce headed by the Procurement unit managed to acquire a sufficient number of surgical masks, even during times when facemasks were just about as scarce as toilet paper, flour, and pasta. The buyers’ network is so flexible that even during the crisis it was able to find an additional 110,000 surgical masks which the Group made available to the federal state of Baden-Württemberg. These masks were distributed to hospitals and doctors’ offices.

Covering your mouth and nose with a mask is a central aspect in Daimler’s hygiene concept. The concept applies to 92 locations worldwide, among them the Accumotive battery factory in Kamenz, …
Covering your mouth and nose with a mask is a central aspect in Daimler’s hygiene concept. The concept applies to 92 locations worldwide, among them the Accumotive battery factory in Kamenz, …
... or the Mercedes-Benz plant in Stuttgart-Untertürkheim, where engines are produced.
... or the Mercedes-Benz plant in Stuttgart-Untertürkheim, where engines are produced.
Some of Daimler’s departments even spontaneously started to produce mouth and nose masks during the COVID-19 pandemic – for example the Mercedes-Benz designo manufaktur in Sindelfingen or the seat manufacturing department at Daimler Buses in Neu-Ulm.
Some of Daimler’s departments even spontaneously started to produce mouth and nose masks during the COVID-19 pandemic – for example the Mercedes-Benz designo manufaktur in Sindelfingen or the seat manufacturing department at Daimler Buses in Neu-Ulm.
In June, Mercedes-Benz even started operation of a fully automatic production line for mouth and nose masks at its Sindelfingen plant. It has a daily capacity of more than 100,000 masks.
In June, Mercedes-Benz even started operation of a fully automatic production line for mouth and nose masks at its Sindelfingen plant. It has a daily capacity of more than 100,000 masks.
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Daimler’s hygiene concept applies to 92 locations worldwide

Yes, the mask — it’s the item of equipment that symbolizes the coronavirus and the new normal it brought about. Some fashion designers have already declared it THE accessory of the 2020 season. You don’t have to like it. But one thing is clear: Mouth and nose masks will be with us for quite some time to come. The physician and pandemic expert Martin Riedel points out that they are an important and effective prevention measure when used in combination with social distancing and the hygiene regulations, including regular handwashing. A Group-wide campaign that included simple but urgent messages and universally understandable pictograms was rolled out and was subsequently on all Daimler computers as lock screen display. The motto: By working together we’ll keep the virus in check.

The first production plants began to ramp up again in mid-April. The Group’s health and occupational safety experts worked together with the Works Council to develop a comprehensive hygiene and safety concept that aimed to combine daily work routines and infection prevention. This concept became the standard at 92 Daimler locations worldwide. The on-site implementation of the measures had already begun during the two-week work interruption and the short-time work phase. Many other companies and policymakers are now using this concept as a template. Measures include the staggering of shift changes in the production areas and the reorganization of work steps in order to maintain the minimum distance of a meter and a half between colleagues wherever possible. In places where this is impossible, wearing a facemask is mandatory, and the Group provides a supply of facemasks. In the canteens and the break rooms, the maximum number of occupants and a fixed seating arrangement have been defined.

Also part of the new normality at Daimler: Fixed seating arragements in the break rooms as well as posters belonging to a Group-wide campaign including universally understandable pictograms.
Also part of the new normality at Daimler: Fixed seating arragements in the break rooms as well as posters belonging to a Group-wide campaign including universally understandable pictograms.

“Today we’re in a different situation than back in February or early March,” says Dr. Martin Riedel. “Back then, the lockdown was the right thing to do because at that point nobody yet knew how we should behave. Since then we’ve learned which regulations and measures are necessary in order to integrate infection prevention into our daily lives.” However, some of the things we took for granted before the pandemic will still be out of the question until further notice. For example, large meetings that bring together several dozen people in one room are not permitted. “We have to be ready to try out new things. A group discussion or a business unit meeting might also work well as a video chat,” says Riedel. In the administrative units, the initial directive still applies: People should work at home if it’s possible for them with their given tasks. After three months, a cautious interim conclusion is possible: Life is certainly not the same as before. But things are working out surprisingly well — and they’re getting better from one week to the next.

The biggest question is probably “What happens next?”

And that brings us back to the new normal. In any case, Martin Riedel has explained to his colleagues on the coronavirus crisis team that the current situation could continue for quite a while. “Over the coming months, and perhaps even years, we will have to learn how to deal with this virus,” he says. “At least until we have an appropriate vaccine or good medicine to deal with the serious cases of COVID-19. Researchers are working intensely in this area. But even in the ideal scenario, I think it will take at least until the summer of 2021 to vaccinate most citizens and thus develop herd immunity.”

Until then, Riedel says our top priority should be to maintain our discipline and solidarity so that a second wave of infection can be avoided as far as possible. He’s not happy about the fact that people’s caution is sometimes giving way to carelessness now that the number of cases is decreasing in most countries. Even though he knows that this behavior is only human. “Our brains aren’t made for calculating exponential functions,” he says. “Imagine this: You’ve got a container in which you place a pathogen that doubles its numbers once a minute, so that the container is full after one hour. This means that after 59 minutes the container was only half full. And after 55 minutes it was only one thirty-second full. It’s very difficult for us to understand why the curve suddenly moves upward so steeply. In Germany we’ve managed to keep the curve from going straight up. At the moment it’s flattening off again. However, to stick with my example, this doesn’t mean that we’ve landed once again at Minute One. No, we’re roughly at Minute 40. And we have to be very careful to make sure the curve doesn’t start rapidly going upward again, even though the heat and ultraviolet light of summer could give us a short break.”

So it’s all about dealing with the circumstance that Minute 40 remains the status quo for a number of months. Ola Källenius is convinced that the short-term crisis management at the peak of the COVID-19 pandemic must now be followed by a phase during which we think about what will happen after the crisis. “One thing is clear: The transformation of the automotive industry, especially the shift toward CO2-neutral mobility and digitalization, will continue in spite of the coronavirus. Perhaps it will even be accelerated by the virus,” says Källenius, who has been Daimler CEO for just over a year. “For us, this means that we have to adapt our business operations to a new reality and a new normal. And we have to continue investing in the transformation topics such as electrification and digitalization.” In a guest article he wrote for a German newspaper in April, Källenius made clear that for Daimler the fight against the pandemic for Daimler will not be an excuse in the fight against climate change.

So that after the danger of COVID-19 has been medically overcome, normality at Daimler will no longer mean wearing a facemask, social distancing, and further prevention measures. But it will still mean decarbonization and digitalization.

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Sven Sattler

is trying to comply with Dr. Riedel’s recommendations in his daily life. However, he has noticed that it can be fairly boring to keep singing “Happy Birthday” over and over while he’s washing his hands. That’s why he was delighted to find an alternative while he was doing the research for this article: washyourlyrics.com.

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