Mercedes-Benz Group: Aiming to go EV-only by 2030
Increasing the ratio of luxury vehicles and EVs to enhance profitability
2022/09/08
- Summary
- EUR 40 billion to be invested to expand EV development between 2022 and 2030, marking a turning point in the shift to EVs
- Mercedes-Benz Cars: Reorganizing into three segments: Top-End Luxury, Core Luxury and Entry Luxury
- Developed its own "MB.OS" and jointly developed an autonomous driving system with NVIDIA.
- Battery production: Acquired a 1/3 equity stake in European battery cell manufacturer Automotive Cells Company (ACC)
- Financial results of the Mercedes-Benz Group: Declining unit sales, but increasing sales and profits
- Outlook for 2022: Prospects for progress, but also risks of uncertainty
- Sales Forecast by LMC Automotive: Mercedes-Benz Group’s sales in 2025 will be 2.92 million units
Summary
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| EQS model leading electric drive (Source: Mercedes-Benz Group) |
The former Daimler AG spun off its "Daimler Trucks & Buses" division on December 9, 2021, and on December 10 the division was listed on the stock exchange as the independent company "Daimler Truck Holding AG. Daimler AG changed its name to "Mercedes-Benz Group AG" and consists of "Mercedes-Benz Cars & Vans" and "Mercedes-Benz Mobility".
At its May 2022 management presentation, the Mercedes-Benz Group confirmed its policy to accelerate the pursuit of both Luxury and Sustainability. The Mercedes-Benz Cars portfolio will be reorganized into three segments: Top-End Luxury, Core Luxury, and Entry Luxury. It will accelerate the introduction of BEVs (battery electric vehicles) in each segment, and by the end of 2022, BEVs will be available in all segments currently entered, and by 2025, BEVs will be available in all models. In 2030, the company plans to shift from an "electric-first" to "electric-only" strategy by using BEVs for all vehicles sold in markets where the environment is suitable (e.g., charging infrastructure).
Mercedes-Benz intends to lead the industry in software. It will develop its own Mercedes-Benz Operating System (MB.OS) to be launched in 2024. In addition, Mercedes-Benz will jointly develop autonomous driving technology with NVIDIA that will be installed in vehicles to be launched in 2024.
For the full year 2021 and January-June 2022, sales and earnings (EBIT) are growing as Top-End Luxury and EV sales expand, although sales volumes continue to decline due to semiconductor shortages and the Ukraine crisis. The average sales price of Mercedes-Benz Cars in 2021 was EUR 49,800, up 26% from 2019.
As for the outlook for 2022, Europe will be the most affected by the situation in Ukraine, with the European market remaining as weak as it was in 2021, but the global automotive market is expected to be about the same as in 2021. For the full year 2022, the company expects group sales to be significantly above and EBIT to be slightly above that in 2021.
In order to effectively promote the rapid shift to EVs and advanced automated driving technology, Mercedes-Benz has quickly transformed its company organization and management infrastructure over the past year, setting a clear path forward. Furthermore, the company is implementing a tough management strategy to improve profits by shifting the sales ratio to high-end vehicles under the difficult circumstances of declining sales volume due to the situation in Ukraine, in addition to the shortage of semiconductors.
Related Reports:
IAA Mobility 2021: Strengthening of Mercedes EQ series, moving from EV-first to EV-only plan（Sep. 2021）
Daimler's carbon-neutral strategy: PHVs and EVs expected to account for 50% of car sales by 2030（Jul. 2021）
Auto Shanghai 2021: NEVs of Non-Chinese OEMs（Apr. 2021）
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