Monday, January 17, 2022
News Mercedes-Benz will Invest Over $60 billion Euros in Electrification and Software development

Mercedes-Benz will Invest Over $60 billion Euros in Electrification and Software development

Mercedes-Benz will spend more than $60 billion euros in the next 4 years towards electrification

  • This money will be invested between 2022 and 2026

  • Investments in research and development will fall by 20% by 2025 compared to 2019

  • Priorities will shift and money will be focused more directly on the important projects

Daimler’s Supervisory board has approved the 2022 to 2026 Mercedes-Benz business plan, which carries over $60 billion in investments.

These investments will be used to speed up and complete the automaker’s shift to electric power as well as increasing research in software development.

The goal of this plan is to lower global research and development spending while positioning Mercedes-Benz as the technology leader in the automotive luxury segment and the premium vans segment.

To achieve this, Mercedes will shift its priorities to focus the money it spends more directly towards the most important projects, such as electrifying its lineup and incorporating software-based innovations in its vehicles.

Innovations in battery technology will contribute to lowering their cost and the implantation of scalable platforms will allow the company to build many different models from the same basic elements, which drastically cuts development time and cost.

Mercedes-Benz also wants to set up a direct sales model, similar to Tesla and other electric vehicle makers, which would allow it to maximise profits on every vehicle by cutting out the dealership’s margin and the negotiations with the customer, with vehicles selling for a fixed price.

Digital services are also expected to become a bigger part of the company’s revenue by moving optional features to subscription models and offering a host of extra-cost available services.

From 2025, every new vehicle platform launched will be fully electric and the company wants to only sell electric vehicles “wherever the market conditions permit”, a strategy similar to Toyota’s, in which internal combustion engines are still part of the picture in countries where the charging infrastructure or the buying public is not ready for mass electrification.

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