LONDON– The chief executive of Germany’s Daimler believes the automaker will deal with stiff opposition from tech giants like Google, Apple and Alibaba if they decide to introduce their own electric cars.
While the tech giants are yet to start selling their own automobiles, reports recommend they could quickly launch items that combine software and hardware as the electrical lorry race heats up.
“There will be extreme competitors,” Daimler CEO Ola Kallenius told CNBC’s Annette Weisbach on Thursday when asked if he was worried about digital business entering the electric lorries market.
“When an industry goes through transformation, I believe it’s natural that new players take a look at the market,” he stated.
Kallenius stated Daimler will “take a look at what the brand represents and take that into the next technological age,” including that the company will be able to construct on its position if it does that well.
His remarks come as Mercedes Benz, which is owned by Daimler, introduces an electrical variation of its flagship S-Class high-end sedan.
“It’s kind of the start of a new age,” Kallenius stated, prior to including that there’s a great deal of “curiosity” surrounding the brand-new vehicle.
Rates for the luxury sedan will be announced in the summer season but Kallenius stated Daimler anticipates to make money on the car from the moment it goes on sale.
He added that the variable costs are greater on vehicles with a large electric battery than they are on vehicles with a standard internal combustion engine.
“Our job throughout this years of change is on the one hand to drive the variable expenses down and bring back in all our sections a margin parity,” Kallenius stated.
Electric vehicle technology is “still in its infancy” and there’s a “lot of work to do,” he continued. “It will be scaled and we will have technological developments. I’m positive that we will have the ability to bring back the margins that we have been utilized to.”