In the next 10 years, Mercedes-Benz continues its preparations to switch to all-electric in all markets where conditions allow. The brand, which has recently led the luxury segment with its safety and technology equipment, is rapidly moving towards an emission-free and software-oriented future by switching from semi-electric vehicles to fully electric cars.
Mercedes-Benz plans to have battery electric vehicles in all segments served by the company by 2022. Starting from 2025, all new vehicle platforms introduced to the market will be fully electric, and users will be able to choose the all-electric alternative for each model produced by the brand. Mercedes-Benz aims to manage this rapid transformation by adhering to its profitability targets.
Ola Källenius, CEO of Daimler AG and Mercedes-Benz AG: “The transition to electric vehicles is gaining momentum, especially in the luxury segment where Mercedes-Benz is involved. The breaking point is getting closer and closer. We will be ready when the markets are fully electrified by the end of these 10 years. This step marks a radical change in the distribution of capital. While managing this rapid transformation, we will continue to protect our profitability targets and ensure that Mercedes-Benz's success is permanent. Thanks to our qualified and motivated team, I believe we will be successful in this exciting new period as well.”
Mercedes-Benz has prepared a comprehensive R&D-based plan to facilitate this change. Between 2022 and 2030, investments in battery electric vehicles will exceed 40 billion Euros in total. Accelerating and developing the electric vehicle portfolio plan will trigger the breaking point for electric vehicle adoption.
Mercedes-Benz to offer three fully electric platforms in 2025
• MB.EAwill cover all passenger cars from medium to large with a scalable modular system, with a focus on electric vehicles for the future electric vehicle portfolio.
• AMG.EAwill be a special performance electric vehicle platform that appeals to technology and performance-oriented Mercedes-AMG users.
• VAN.EAwill be a new era for purpose-built electric commercial and light commercial vehicles that will contribute to the emission-free transportation and cities of the future.
Vertical integration: Mercedes-Benz will deepen the level of vertical integration in production and development and supply electrified powertrain technology, after reorganizing its powertrain systems to bring planning, development, purchasing and production under one roof. This move also includes the acquisition of UK-based electromotor company YASA. With this agreement, Mercedes-Benz gains access to its unique axial smart engine technology and expertise to develop the next generation of ultra-high performance engines. In-house electric motors form an important part of the strategy, such as the eATS 2.0, which clearly focuses on the overall cost of the entire system, including efficiency, inverters and software. As the world's largest New Energy Vehicle (NEV) market, home to hundreds of companies and suppliers specializing in electric vehicle components and software technologies, China is expected to play an important role in accelerating Mercedes-Benz's electrification strategy.
Battery: Mercedes-Benz plans to set up 200 more massive plants to manufacture batteries, in addition to its current 9-plant plant plan, which will require a battery capacity of over 8 Gigawatt-hours and, together with its worldwide partners, will focus on building battery systems. The next-generation batteries will be of a high standard and suitable for use in more than 90 percent of all Mercedes-Benz cars and commercial vehicles, and will be flexible enough to offer customers individual solutions. Mercedes-Benz plans to work with new European partners to develop and efficiently manufacture future batteries and modules to continue to drive the auto industry in the electric age. Battery production will give Mercedes-Benz the opportunity to transform its existing powertrain production network. Mercedes-Benz aims to increase the range of the model throughout its production life by always integrating the most advanced battery technology into cars and commercial vehicles. With the next battery generation, Mercedes-Benz will work with partners like SilaNano to further increase energy density using silicon-carbon composites. This will allow for an unmatched range and even shorter charge times. Mercedes-Benz is in talks with business partners to develop batteries with even higher energy density and safety in solid state technology.
Charge: Mercedes-Benz is also working to set new standards in charging: “Plug and Charge” allows users to seamlessly plug, charge and unplug vehicles without additional steps for authentication and payment. “Plug and Charge” will be launched later this year with EQS. Mercedes me Charge is still one of the world's largest charging networks and currently consists of over 530.000 AC and DC charging points worldwide. In addition, Mercedes-Benz is working with Shell to expand its charging network. By 2025, customers will have access to Shell's Recharge network of more than 30.000 charging points in Europe, China and North America and more than 10.000 high-power chargers worldwide. Mercedes-Benz also plans to open several premium charging points in Europe with premium facilities that will offer a personalized charging experience.
VISION EQXX: Mercedes-Benz is developing the Vision EQXX, an electric car with a range of over 1.000 kilometers and is aiming for a single-digit Kwsa per 100 kilometers (more than 6 miles per kWh) at normal highway driving speeds. Experts from Mercedes-Benz's F1 High Performance Powertrain Division (HPP) continue to develop the project in line with ambitious goals. The world launch of the Vision EQXX will take place in 2022. The technological advances made with the Vision EQXX will be adapted and applied for use in new electrical platforms.
Mercedes-Benz is currently preparing its global production network for electricity generation only at a pace in line with market demand. Thanks to investments in flexible production and the advanced MO360 production system, Mercedes-Benz can already mass-produce battery electric vehicles. Eight Mercedes-Benz electric vehicles will be produced in seven locations on three continents next year. In addition, all passenger car and battery assembly plants operated by Mercedes-Benz AG will switch to carbon neutral production by 2022. In order to increase production efficiency, Mercedes-Benz joins forces with the German world giant GROB in innovative battery production and automation systems and strengthens its battery production capacity and know-how. The collaboration includes battery module assembly as well as package assembly. Mercedes-Benz also plans to establish a new battery recycling plant in Kuppenheim, Germany, to develop and secure its recycling capacity and know-how. The facility will be operational in 2023 as a result of promising talks with the authorities.
The transition from internal combustion engines to electric vehicles is very feasible and is still ongoing at Mercedes-Benz. Working with employee representatives, Mercedes-Benz will continue to transform its workforce by leveraging comprehensive requalification plans, early retirement and acquisition. TechAcademies will offer employees training for future-oriented qualifications. In 2020 alone, around 20.000 personnel were trained in e-transportation in Germany. 3.000 new software engineering jobs will be created worldwide to implement MB.OS operating system development plans.
Mercedes-Benz remains committed to its margin targets set for fall 2020. Last year's goals were based on 2025% hybrid and electric vehicle sales by 25. At this point, it is based on xEV share of up to 2025 percent by 50 and sales of all-electric new cars at the end of 10 years. While the proportion of high-end electric vehicles such as Mercedes-Maybach and Mercedes-AMG is rising, it is also aimed to increase net income per unit by providing more direct control over pricing and sales. Revenue growth from digital services will further support results. Mercedes is also working to further reduce variable and fixed costs and the capital share of investments. With advances in battery technology, common battery platforms and scalable electrical architectures are expected to result in higher standardization and lower costs. Battery costs per vehicle are expected to drop significantly. Capital allocation is moving from electric first to all-electric. Investments in internal combustion engines and rechargeable hybrid technologies will fall 2019 percent between 2026 and 80. Accordingly, Mercedes-Benz is planning a company margin in the electric vehicle world, similar to the internal combustion era.
Ola Källenius, CEO of Daimler AG and Mercedes-Benz AG; “Our core mission in this transformation is to persuade customers to switch with impressive products. Our flagship EQS is just the beginning of this new era for Mercedes-Benz.” said.