National Press Release

LOS ANGELES, May 4 /PRNewswire-USNewswire/ -- The following letter has been sent to Dr. Dieter Zetsche, Chairman of the Board of Management of Daimler AG, by Richard Holober, Executive Director of the Consumer Federation of California (CFC). In the letter, the consumer-rights advocates caution against the "serious risks and social irresponsibility" after leading civil rights organizations like the NAACP and the League of United Latin American Citizens last summer alerted Daimler management of their concerns that the company would lure mostly immigrant, low-wage Southern California port drivers into new truck leases they could not afford. The coalition of groups issued the report "Foreclosure on Wheels: Long Beach's Truck Program Puts Drivers at High Risk for Default," which is available here.

Background: Daimler Truck Financial was awarded a contract by the Port of Long Beach to finance its "Clean Trucks Program." Under the terms, Daimler backs the funding for a low-emissions vehicle to any independent port truck driver whose dirty diesel rig is banned by the port, regardless of his/her credit worthiness and ability to pay. Discounted for volume, clean diesel and alternative fuel trucks cost $100,000-$200,000. A Daimler official publicly told Long Beach officials that the company expects "over 40%" of port drivers to have "high difficulty meeting the payments" and that the company's strength is "managing collections," i.e., repossessing trucks. Port drivers average $11-12 an hour.

The full letter is in English below (German translation available by contacting CFC).

To Dr. Dieter Zetsche, Chairman of the Board of Management, Daimler AG:

Sales dropping 35%, profits plunging 60%, possible U.S. Securities and Exchange Commission violations and multi-million dollar fines, violations of U.S. Fuel Economy standards and more multi-million dollar fines, recalls for defective equipment across the globe: there appears to be a serious leadership problem at Daimler that cannot be attributed to the global recession.

When we alerted Daimler Financial Services management last summer of the serious risks and social irresponsibility of its planned role a scheme to force drivers at the Port of Long Beach, California to participate in predatory lease schemes for new trucks that they could not afford, Daimler management refused to listen.

When we issued our report, "Foreclosure on Wheels" last August, the prospects of the Long Beach truck drivers being able to make the lease payments promoted by your company were dismal at best. Today as the economy has continued its downward slide and the volume of imported containers plummets, the prospects of these already-impoverished drivers repaying their loans are worse than ever.

Already we have heard several heart-wrenching stories from drivers who have been pressured into buying trucks in order to keep their jobs. Most drivers when faced with the option of debt or unemployment end up purchasing a truck in hopes of keeping some minimal income coming in. One such driver, Jesus, took home a check for less than $5 after a week's worth of work. On a 'good' week he manages to work over 15 hours a day and only take home a couple of hundred dollars. Although Jesus has been forced to take up a second job on weekends in order to afford the truck payment, he knows it's only a matter of time before cargo levels stay at a consistent low or diesel levels reach a new high and he is forced to simply walk away from the truck and default on the lease.

It is irresponsible for Daimler to continue to finance trucks for owner-drivers who get paid not by the hour, but by the number of containers they haul. The volume of work will not sustain these leases. Drivers do not want these leases. More than being predatory, these leases to drivers who are being forced to buy trucks that should be purchased by the motor carriers they work for are coercive, exploitative and ultimately disastrous for both the drivers, your company, and shareholders. Using the excuse that these leases are a good way to sell your trucks makes the leases all the more outrageous.

We are sure that our California lawmakers and state officials responsible for regulating consumer lending will show a great interest in investigating this operation, as will federal officials who oversee financial institutions. No company connected with Daimler should receive government financial assistance after embracing and promoting such irresponsible leases.

We urge you to reconsider this ill-advised port truck financing program. This company's participation has created significant exposure to state and federal investigation along with ensuing negative publicity that should be a matter of concern to your Board.

Sincerely,

Richard Holober

Executive Director, Consumer Federation of California (sent via fax April 24, 2009)

For more information, see Los Angeles Times "Port of Long Beach's clean-trucks loan program is criticized" and visit the Consumer Federation of California press center.

SOURCE Consumer Federation of California