Aiming To Transform Into Software-driven, Emissions-free Future Mercedes-Benz Invests € 60 Bn

Mobility Outlook Bureau
03 Dec 2021
06:54 PM
1 Min Read

The endorsement by the Supervisory Board reinforces its commitment to sustainably achieving the margin targets communicated in October 2020 and reiterated in July 2021.

Mercedes Benz

Daimler AG’s Supervisory Board has approved the Mercedes-Benz Business Plan for 2022 to 2026, endorsing the strategic plan for the company to go fully electric. 

Following the Daimler Truck spin-off, Mercedes-Benz will consistently focus on profit and growth opportunities in the passenger car and vans businesses. In addition, the luxury brand will strive for leadership in the area of electric drives and car software.

To transform into a software-driven and emissions-free future, the Supervisory Board signed off on an investment plan for 2022 to 2026 of more than € 60 billion. Although the company plans to reduce Capex, research and development expenditure for the electrification of the product portfolio and digitalisation measures, including steps towards automated driving, will remain at a high level, the company said in a statement.

The endorsement by the Supervisory Board of the Mercedes-Benz Business Plan reinforces the company’s commitment to sustainably achieving the margin targets communicated in October 2020 and reiterated in July 2021, also during an accelerated transformation towards an electric-only era. A critical lever for achieving this is to increase net revenues per vehicle. In addition, a gradual shift toward a direct sales model, which includes control over pricing, is being sought. Furthermore, rising revenue from digital services will further support results.

The key to achieving this is stringent prioritisation of future investments – mainly by focusing on electric mobility. The company expects that the use of standardised battery platforms and scalable vehicle architectures - together with advances in battery technology - will reduce the variable costs of vehicles. As a result, the battery costs in a vehicle are expected to decrease significantly this decade.

Ola Källenius, Chief Executive Officer of Daimler AG and Mercedes-Benz AG, said, “Our goal is technological leadership in the automotive luxury segment and in the area of premium vans while remaining committed to our ambitious margin targets. Mercedes-Benz has what it takes: a clear strategy, a highly qualified and motivated team, as well as strong support from the entire supervisory board. With the most desirable cars we want to grow profitably and create sustainable value for our customers, employees, shareholders and partners.”

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