Daimler to speed up electric shift as 2021 starts strongly

Mercedes-Benz maker Daimler said it will accelerate its shift to electric cars as it builds on a strong start to 2021 despite a global semiconductor chip shortage, but gave no details of how fast its car lineup will go electric.

Daimler said it expected 2021 to be a significantly better year for revenue, and pretax profits than a pandemic-hit 2020.

Like German rivals BMW and Volkswagen Group, Daimler benefited from Chinese demand for high-margin luxury vehicles in the second half of 2020, which helped sales to recover from production shutdowns in the spring.

“After a good start with a tailwind from last year, Daimler is confident about the current financial year,” the company said in a statement on Wednesday.

But a shortage of chips the auto industry uses in a range of functions, such as managing fuel economy and emergency braking, has meant much of the industry has struggled to maintain output.

Daimler said it planned to speed up the electrification of its product range, but did not provide any specific detail.

In 2019, Daimler said it expected plug-in hybrids or all-electric vehicles to make up more than 50 percent of its car sales by 2030.

“We want to accelerate the electrification of our product portfolio,” CEO Ola Kallenius said. “It’s our goal to reach this target sooner.”

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When asked during a video conference call with investors why Daimler had not provided updated targets, Kallenius said this would depend on many factors, including the availability of charging infrastructure.

Kallenius said Daimler will retool two of its oldest German plants, Untertuerkheim and Berlin-Marienfelde, and retrain workers to make electric car components as well as parts for fossil-fuel models.

The Mercedes EQA full-electric compact car went on sale in Europe on Feb. 4. The EQS range-topping electric sedan will debut on April 15 as the first Mercedes to be built on a new dedicated EV platform. The EQS should have a battery range of up to 770 km (478 miles), Daimler has said. The EQB and EQE will follow later this year.

Automakers are developing faster charging batteries for consumers used to filling combustion engine fuel tanks in just minutes. Kallenius said the EQS can be charged up to a range of 300 km in 15 minutes.

Car companies are racing to adapt as CO2 emissions targets tighten in Europe and China.

This month, BMW said it expected at least 50 percent of its sales to be zero-emission vehicles by 2030. Volvo has said its lineup would be fully electric by 2030, and Ford Motor Co. said in February its European passenger cars would be too. Bentley and the Jaguar brand are also going all-electric.

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While it focuses on electric cars, Daimler is preparing to list its truck making unit, Daimler Truck, which it said should happen by the end of 2021.

It announced plans to spin off the unit, the world’s largest truck and bus maker, in February, seeking to increase its investor appeal as a focused electric, luxury car business.

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