Mercedes aims to bounce back from a challenging 2024 with an emphasis on technology and electrification—but also with a renewed focus on "combustion" vehicles.
- Mercedes-Benz was among several automakers that cancelled plans to shift to all-electric vehicles by 2030 last year.
- Mercedes is shifting its focus to more internal combustion-powered vehicles due to slower electric vehicle growth and challenges competing in the Chinese market.
- However, it has several new EV models in the works, including an electric E-Class and C-Class.
Now, Mercedes is working on a turnaround plan, and it's tackling multiple challenges simultaneously: reducing costs, investing in emerging technologies such as artificial intelligence, shifting its focus to "combustion" models and hybrids, and still launching new electric vehicles.
The company's plan involves "dozens of new or revamped models" to be released within the next two years, as announced at its Capital Market Day presentation. This initiative includes the introduction of all-electric versions of the E-Class sedan, C-Class sedan, and GLC-Class crossover, equipping some of its most in-demand models with battery power. Mercedes describes this plan as "the most ambitious product launch program in its history," which includes 19 new combustion engine models and 17 battery-electric vehicles by the end of 2027.
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Mercedes-Benz Capital Market Day
All of them feature a fully integrated technology platform and utilize the most recent advancements in artificial intelligence," said Mercedes' Chief Technology Officer Markus Schaefer, in a statement. "They will be equipped with cutting-edge technologies such as the latest automated driving assistance systems and innovative features like a new steer-by-wire system.
Mercedes CLA-Class Specs
It also debuts MB.OS, Mercedes'' new in-house operating system, and promises to be a truly software-defined vehicle, similar to a Tesla or a Rivian, connected to devices like your smartphone and upgradable over time with wireless updates. The CLA will utilize Mercedes' new MMA platform, which is designed to be flexible, accommodating both electric power and electrified combustion engines, and is set to debut later this year.
That launch will be succeeded by the electric GLC, which Mercedes refers to as "a turning point in our midsize segment... this is the all-electric SUV our customers have been waiting for.” Although Mercedes does not specifically mention it, a new electric S-Class is also planned, presumably around or after that model's "major upgrade" in 2026.
Mercedes CLA MMA Platform
The soap-bar-like appearance of Mercedes' EQ cars didn't appeal to many potential buyers.
Mercedes executives stated that they intend to focus more on the "specialized" divisions that are experiencing growth, such as AMG performance cars, the ultra-luxury Maybach brand, and the expanding G-Class family of off-road SUVs.
Despite this, Mercedes still has a difficult path ahead, and the problems it faces are reflective of the challenges the entire automotive industry will encounter in the 2020s.
The company made a significant investment in an all-electric future but experienced much slower growth than expected, with Mercedes being one of the few automakers to report a decline in electric vehicle sales in 2024. It is facing substantial losses in China, its largest market and profit driver, as well as uncertainty surrounding tariffs in the US. To stay competitive, the company must invest in future electric vehicles, expand its hybrid offerings, continue developing popular combustion engines, and reduce costs amidst a challenging economic climate.
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