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HomeCarsMercedes backtracks on its 100% electric future and invests massively in "high-tech"...

Mercedes backtracks on its 100% electric future and invests massively in “high-tech” thermal engines

In an unexpected strategic turnaround, Mercedes-Benz announces that it will not ultimately be a fully electric brand by 2030 as initially planned. The German manufacturer will invest millions in the development of more efficient internal combustion engines. This change of direction reflects the challenges faced by the automotive industry in its transition to electric.

A revised electrification target downwards

Just three years ago, Mercedes-Benz had very high ambitions for electrification:

  • Transition from โ€œEV firstโ€ to โ€œEV onlyโ€
  • 100% electric versions for all models
  • Complete abandonment of gasoline and diesel engines by 2030
  • Today, the automaker admits that those goals were too ambitious. Mercedes CEO Ola Kรคllenius says internal combustion engines will remain around “well beyond the 2030s.”

    A massive investment in thermal engines

    Mercedes announces an investment of 14 billion euros (around 15 billion dollars) in its passenger car division. A significant part of this sum will be devoted to the development of โ€œhigh-tech combustion technologiesโ€:

    โ€“ Improvement of existing thermal enginesโ€“ Development of new engines, in particular for the future S-Classโ€“ Optimization of engine-transmission combinations to reduce CO2 emissions

    The aim is to comply with future Euro 7 and China 7 emissions standards, while avoiding heavy fines.

    The reasons for this turnaround

    Several factors explain this change in strategy:

    โ€“ Lower than expected demand for electric vehicles โ€“ Lack of charging infrastructure โ€“ Technical and logistical difficulties in the transition to electric โ€“ Need to meet increasingly strict emissions standards for thermal engines

    Mercedes is not the only brand to revise its ambitions. Other manufacturers such as GM, Ford or Jaguar have also had to adjust their electrification plans.

    A new balance between electric and thermal

    Despite this comeback of thermal technology, Mercedes is maintaining its objective of carbon neutrality by 2040. The manufacturer's strategy is now based on a mix:

    โ€“ Continued development of electric vehiclesโ€“ Investment in hybridization technologiesโ€“ Improvement of thermal engines to make them cleaner and more efficient

    This more pragmatic approach aims to respond to different market needs while preparing for the long-term future.

    A challenge for the automotive industry

    The case of Mercedes illustrates the difficulties encountered by the entire automotive sector in its transition to electric:

    โ€“ High development and production costs โ€“ Adaptation of production chains โ€“ Staff training โ€“ Transition management for suppliers

    Faced with these challenges, many manufacturers are reviewing their schedules and adopting more gradual approaches.

    This strategic turnaround by Mercedes-Benz highlights the complexity of the energy transition in the automobile industry. Between ambitious environmental objectives, regulatory constraints and market realities, manufacturers must constantly adjust their plans.

    Mercedes' massive investment in “high-tech” thermal engines shows that the road to 100% electric mobility will probably be longer and winding than initially expected. It also highlights the importance of maintaining a diversified approach to engines to meet the different needs and constraints of the global market.

    This new strategy from Mercedes could well influence other players in the sector, leading to a global reassessment of short and medium term electrification objectives in the automotive industry.

    SRQ Backlot