Mercedes 380 Sl on 2040-cars

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Automakers face reality of EVs' cost — to jobs, and their bottom line

Related: We obsessively covered the Frankfurt Motor Show — here's our complete coverage FRANKFURT, Germany — European car bosses gathering for the Frankfurt auto show are beginning to address the realities of mass vehicle electrification, and its consequences for jobs and profit, their minds focused by government pledges to outlaw the combustion engine. As the latest such announcement by China added momentum to a push for zero-emissions motoring, Daimler, Volkswagen and PSA Group gave details about their electric programs that could give policymakers some pause. Planned electric Mercedes models will initially be just half as profitable as conventional alternatives, Daimler warned — forcing the group to find savings by outsourcing more component manufacturing, which may in turn threaten German jobs. "In-house production is almost irrelevant to the consumer," Daimler boss Dieter Zetsche told reporters on the eve of the Frankfurt Motor Show, in the midst of a German election campaign in which automotive jobs have loomed large. The company set a target of saving 4 billion euros ($4.8 billion) by 2025 to help fund the cost of its electric cars. "Daimler is the first company to state explicitly how much electric vehicles are going to hurt margins," said Bernstein analyst Max Warburton. "It was brave to go first — but of course it won't be the last." Volkswagen, for its part, said it was seeking new global supplier contracts to source 50 billion euros ($60 billion) of electric car content including batteries, which are not yet manufactured competitively in Europe. "A company like Volkswagen must lead, not follow," Chief Executive Matthias Mueller told reporters. VW diesel emissions-cheating exposed by U.S. regulators in 2015 triggered global public outrage, dozens more investigations into test-rigging by the wider industry and a push by some lawmakers to ban diesel and eventually all engines. TIGHTENING NOOSE Tesla shares jumped nearly 6 percent on Monday after a Chinese minister said it was a question of when, not if, Beijing bans fossil-fuel cars, tightening the noose around the combustion engine. France and Britain have promised its outright abolition by 2040. But PSA, the maker of Peugeots and Citroens, said it was concerned about the risks if consumers were left behind in the rush, and a new generation of battery cars does not sell.

Daimler could sell off Li-Tec's EV battery business

Five-plus years may have been about enough time for Daimler AG to know whether it wanted to be in the battery-pack production business. The Mercedes-Benz parent may stop making electric-vehicle batteries and ultimately sell its Li-Tec battery-cell factory in Germany within two years, according to Bloomberg News which cites Manager Magazin. The beneficiary may be LG Electronics, which would likely take over battery-production duties for models such as Daimler's Smart ED battery-electric vehicle. Daimler is taking a number of steps to improve profit margins, which are thinner than those of its German rivals like BMW. Like its German competition, the company has lagged behind companies such as Nissan, Renault and Tesla Motors in terms of aggressively pursuing growth via plug-in vehicle sales. Daimler spokesman Hendrik Sackmann, in an e-mail to AutoblogGreen, would only say that the battery business is growing "rapidly" and that Li-Tec is developing "according to our plans." "Regarding Li-Tec, we are working on a concept for the future line-up," he added. "The battery cells for the successor of the Smart electric drive won't be provided by Li-Tec." Daimler in 2008 launched Li-Tec as a joint venture with Evonik, though Daimler recently put plans together to buy out Evonik's 50-percent share of Li-Tec, Bloomberg reported last month. Evonik's role was manufacturing electrodes and separators for batteries. Daimler also said last fall that it was looking to cooperate more extensively with Tesla in regards to electric vehicle development. The two companies first said they'd work together in 2009. Featured Gallery 2013 Smart Fortwo ED View 16 Photos News Source: Bloomberg NewsImage Credit: Daimler Green Plants/Manufacturing Mercedes-Benz battery

Mercedes plotting E-Class Maybach, next A-Class for the US?

Mercedes-Benz has opened 2015 by hinting at a host of new products. Dieter Zetsche nudged the idea that there'll be a Maybach-branded SUV. AMG chief Tobias Moers told Motor Trend that "We want to be seen by the public on the same level as the other sports car maker in Germany" when asked if his crew was working on a car to rival the Porsche 918 Spyder. That and a few other tidbits have people thinking that we'll eventually see some sort of celestial AMG supercar. The latest handful of hints came from Mercedes USA CEO Steve Cannon during an interview on the marque's move to Atlanta. Cannon told Automotive News that we'd "see more from the Maybach brand," leaving the impression that there "could" be an E-Class draped in the superluxury trim. If such came to pass, there's plenty of pricing room between the E and the S-Class to slot a higher trim in. The top non-AMG E-Class starts at $62,350, the S-Class opens the bidding at $94,400. Even if you slapped the E-Class with the $23,000 premium it takes to make an S600 a Maybach S600, you've still got plenty of breathing room between the midsized and full-sized sedans. At the antipodal end, Cannon told AN that we could get a front-wheel-drive Mercedes smaller than anything here right now. That leaves the A-Class, since we've already got the B-Class. Getting the next-gen A-Class here would help with CAFE numbers, and since it will be built in the new factory in Aguascalientes, Mexico it won't have far to travel to get here. We're told it won't be like the current car, however; Cannon said, "The A-Class will change from what you have seen and from what you are used to." We hope that's a good thing, because we really like the current car. Related Video: