Dialogue with Ola K?llenius, CEO of Mercedes-Benz

On the occasion of the publication of Mercedes-Benz’s Annual Results 2022, I asked Ola K?llenius the following questions regarding the European Union’s intent to forbid internal combustion engine cars by 2035.

Question: Should EU politicians establish overall goals in favor of the climate instead of making technological decisions?

Ola K?llenius: As the inventor of automobiles, Mercedes-Benz has always been driven by innovation. We say yes to technology, to the future, to courage, to creativity, and to entrepreneurship. We have always been committed to technology, and we think that [given] technologies should not be banned

But the fact that we have an open mind toward technology does not mean that we do not establish priorities. For us, it is clear that the main avenue for decarbonization of passenger cars -- in this and the next decade -- is battery electric vehicles. This is our strategy, and we have invested many billion in it, and our complete product portfolio will be fully electrified by the end of this decade.

Question: If internal combustion engine cars are forbidden in Europe, would it entail a significant competitive advantage to lower-cost electric vehicles (EV) from China?

Ola K?llenius: We do not know when the last internal-combustion engine cars will leave the assembly line, but we look after our part of the market -- the upper segment --, and we do not speak on behalf of the entire market.

However, regarding the entry-level segment, the EV challenges is much more significant due to variable costs. Therefore, I understand why there are discussions about competition from foreign countries.

But it always holds true that companies must always remain competitive, be more creative than their competitors, and control their cost structure.

If we have a footprint all over the world -- either because we export or produce in all other countries -- it is quite natural that foreign companies also try their luck in our countries. This is part of the game.

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Original discussion (in German): https://group.mercedes-benz.com/investoren/berichte-news/geschaeftsberichte/2022/#tab-module-8622852?(from 40 min. 30 sec)

Hopefully, this short phone discussion will be followed by a full interview for Market.ch (NZZ group) during which it will be possible to dig much deeper on these issues and many other topics.

@PhilippeMonnier