Every Mercedes-Benz model to have full-EV option from 2025

Mercedes-Benz has revealed an ambitious plan to go all-electric by 2030 "where market conditions" allow. 

Included in a wide-reaching strategy announcement today were plans on how it will reduce investment in combustion engines, cut EV manufacturing costs and maintain today's profit margins. Most notably, it will introduce four all-new bespoke EV platforms by 2025 for use across its entire product line-up, and it has committed to building eight new EV battery factories worldwide, four of which will be in Europe. 

Key to the new strategy is a commitment to prioritising profit over volume, which will result in Mercedes increasing sales of top-rung models and standardise the majority of components it uses in vehicle production.

EV options in all segments

Accelerating a number of targets revealed in its earlier Ambition 2039 strategy, the firm will now offer a BEV in all segments from 2022 and will offer an EV option for all of its models from 2025.

Following the launch of the new MMA EV architecture for small vehicles in 2024, all Mercedes platforms developed will be EV-only, and in 2025 it will launch three all-new architectures catering to its entire portfolio.

The new MB.EA platform will underpin medium and large passenger vehicles, such as SUVs; AMG.EA will be developed by Mercedes' in-house performance division for future electric sports cars; and the Van.EA platform will be used for light commercial vehicles (LCVs). 

Following the launches of the EQC, EQA, EQB, EQV and EQS, Mercedes will launch the new EQE saloon, EQE SUV and EQS SUV in 2022, giving it a total of eight EVs in the passenger car market.

Two new versions of the EQS saloon are also due imminently: an AMG-badged performance option and a Maybach luxury range-topper.

Long-range plug-in hybrid models (such as the new C300e, which has a claimed EV range of 62 miles) will continue to play an important role in Mercedes' product strategy, but "more and more customers are switching" to pure EVs, so the firm has accelerated its transition to support the shift.

Increased investment but maintained margins

Mercedes CEO Ola Kallenius said: "The EV shift is picking up speed - especially in the luxury segment, where Mercedes-Benz belongs. The tipping point is getting closer, and we will be ready as markets switch to electric-only by the end of this decade.

"This step marks a profound reallocation of capital. By managing this faster transformation while safeguarding our profitability targets, we will ensure the enduring success of Mercedes-Benz. Thanks to our highly qualified and motivated workforce, I'm convinced that we will be successful in this exciting new era.”

As part of the plan, Mercedes has committed more than €40 billion (£34.3bn) to the development of new EVs. It will stick to the target margins detailed in 2020 but notes that its earlier targets were based on "the assumption of selling 25% hybrid and electric vehicles by 2025". Now Mercedes predicts that such EVs will account for a market share of up to 50% by 2025. 

To maintain profit margins, Mercedes will seek to "increase net revenue per unit" by raising the proportion of high-end Maybach and AMG models sold and by generating more revenue through digital services. 

Using the new modular platforms across its model portfolio will help to increase standardisation and thereby reduce manufacturing costs for all models, plus Mercedes expects battery costs to fall significantly, further reducing production costs. 

 By 2026, investment in combustion engines will have fallen 80% compared with 2019 levels, although the firm didn't offer an end date for ICE vehicle production. 

Overall, the company said, it expects broadly similar profit margins in the EV era, compared with those it recorded with a largely combustion-powered offering.

New-era batteries and gigafactories

To support this rapid EV expansion, Mercedes has committed to building eight new EV battery factories worldwide, one of which will be in the US, along with four in Europe, for a total production capacity of 200GWh. This expansion, Mercedes said, comes in addition to existing plans for "nine plants dedicated to building battery systems". 

One of the European sites will be developed with an as-yet unnamed technical partner. Mercedes has promised to reveal further details when the deal is officially signed off.

Mercedes' next-generation batteries will be "highly standardised and suitable for use in more than 90% of all Mercedes-Benz cars and vans". It plans to increase energy density using silicon-carbon anode technologies to offer "unprecedented range and even shorter charging times". 

Notably, the firm claims it is "in talks with partners" to develop solid-state battery technology, which will markedly improve energy density and safety.