Mercedes needs to drive purely electrically by the tip of the last decade

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Daimler said on Thursday that its Mercedes-Benz brand was “ready to go fully electric by the end of the decade if market conditions allow”.

It’s the latest sign of how major automotive companies are gearing up for a future based on electric vehicles.

According to Daimler, all newly introduced vehicle architectures from Mercedes-Benz will be purely electric from 2025.

In summary, Daimler explained how it wanted to bring three all-electric architectures to market this year: MB.EA, which will relate to medium-sized and large cars; AMG.EA, which will focus on performance vehicles; and VAN.EA, for light commercial vehicles and vans. Models based on these platforms will only be electric.

From 2025 onwards, consumers should also have the option of purchasing a “fully electric alternative” for each of the company’s models.

“The EV conversion is picking up speed – especially in the luxury segment, where Mercedes-Benz belongs,” said Ola Källenius, who heads both Daimler and Mercedes-Benz, in a statement.

“The tipping point is approaching and we will be ready when markets switch to all-electric vehicles by the end of this decade,” he added. “This step marks a profound reallocation of capital.”

Read more about electric vehicles from CNBC Pro

In view of its plans, Daimler announced that Mercedes-Benz would ramp up its research and development. “Overall, investments in battery-electric vehicles between 2022 and 2030 will amount to over 40 billion euros.”

In addition to global partners, Mercedes also wants to set up eight gigafactories to produce the cells it needs for its vehicles. This would complement plans to develop nine plants with a focus on battery system development.

Daimler added that Mercedes-Benz intends to “work with new European partners to develop and efficiently produce future cells and modules, a step that will ensure that Europe remains at the center of the automotive industry in the electric age.”

Low-emission and zero-emission transport is seen as a crucial tool for large economies trying to reduce their ecological footprint and reduce air pollution.

For example, the UK government plans to stop selling new diesel and gasoline cars and vans by 2030, and to have zero exhaust emissions for all new cars and vans from 2035.

Elsewhere, the European Commission, the executive branch of the EU, aims to reduce CO2 emissions from cars and vans by 100% by 2035.

Against this background, numerous companies in the automotive industry have announced that they will be expanding their range of low-emission and zero-emission vehicles.

For example, earlier this month the Volkswagen Group announced that by 2030 half of its sales will be battery-electric vehicles. By 2040, almost 100% of its new vehicles in the most important markets should be emission-free.

As early as March, the CEO of the Volkswagen Group rejected the idea that his company could merge with Tesla and told CNBC that the German automotive giant wanted to go its own way.

In an interview with “Squawk Box Europe” Herbert Diess was asked whether he would rule out a future deal with Elon Musk’s electric car maker, in which VW could manufacture its cars, or whether the Tesla and VW brands would ever unite.

“No, we didn’t think about it [that], we go our own way, “he replied.” We want to get close and then overtake.

“We think we can – we need our own software stack, our own technology,” he added. “And I also think that Tesla or Elon is thinking a lot … [about] his way forward. So no, there are no talks between Elon Musk and me about a merger. “

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