Mercedes (and others) catching up to Tesla
Lots of focus on the auto sector to start the year. Chip shortages hampered production throughout all of 2021 and carmakers are now looking to catch up lost production and eyeing the next generation of progress: Autonomous driving, software upgrades and new electric vehicles.
Lots has been made of Tesla’s first-mover advantage, but the big boys are catching up. We covered the speculation that Apple was gaining ground back in November, while Volkswagen’s ID.5 has been widely regarded as a genuine competitor for Tesla’s model Y.
In the Operating System/Software space:
- Toyota aims to launch ‘Arene’ in it’s own vehicles in 2025, before making it available to affiliates and monetising the operating system through a licensing model
- Volkswagen is working on their vw.os
- The General Motors OS is under development too
- Daimler (soon to rebrand as Mercedes) is also looking to launch MB.OS in 2024.
All of this is centred around the theme that cars will follow smartphone technology, and become hubs for add-ons and new features to be added to vehicles, with the ultimate goal of making them as autonomous as possible, and adding office and entertainment features to be enjoyed by the passengers, among other things, along with easy to update apps and upgradeable software.
Let’s not forget all of the usual functions either. Toyota’s Arene for example, will control basic components such as steering, brakes, acceleration, safety systems, location & traffic information and so on.
Away from the software, vehicle upgrades will be a huge driver too.
Mercedes (Daimler) unveiled their battery-powered VISION EQXX prototype this week, claiming to have found the solution to range anxiety, and as you’d expect, it looks stunning:
“The Mercedes-Benz VISION EQXX is how we imagine the future of electric cars. Just one-and-a-half years ago, we started this project leading to the most efficient Mercedes-Benz ever built – with an outstanding energy consumption of less than 10 kWh per 100 kilometres.
It has a range of more than 1,000 kilometres on a single charge using a battery that would fit even into a compact vehicle. The VISION EQXX is an advanced car in so many dimensions – and it even looks stunning and futuristic.
With that, it underlines where our entire company is headed: We will build the world’s most desirable electric cars.”
~Ola Källenius, Chairman of the Board of Management of Daimler AG and Mercedes-Benz AG
Obviously, this is just a concept car. However, Chief Technology Officer for the Vision EQXX, Markus Schafer said a "number of elements of the car are close to moving into production. We're very close to a serious car we'll see in 2024."
The company has already announced plans to invest $45 billion by 2030 in the all-electric car market, which includes plans to build eight battery plants. What these developments mean for Tesla remains to be seen.
Daimler/Mercedes stock price has made a positive start to 2022, gaining around 6% in the first two trading days, reversing some of the sharp fall seen at the end of last year.
The 20 & 200 day moving averages will be the next challenge to overcome. If Mercedes can position themselves ahead of the pack and eat into Tesla’s advantage, they could become the EV leader sooner than expected.
Not investment advice. Past performance does not guarantee or predict future performance.
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