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For new Daimler under Källenius, China plays new role

Everything is new at Daimler.

It has a new CEO in Ola Källenius, who is taking the company on a new path toward sustainability and e-mobility and trying to reinvent the Mercedes-Benz brand into a so-called “sustainable modern luxury” brand.

It had an entirely new exhibition concept at last month’s Frankfurt Motor Show, turning Frankfurt Messe’s Festhalle, the brand’s exclusive venue, from the usual brand exhibition into a “brand encounter” where visitors could immerse themselves in various brand experiences and interactive displays rather than just showing a bunch of new cars.

It introduced the VISION EQS Concept based on a new dedicated, fully-variable electric vehicle platform for the brand’s future luxury large sedans.

The usual practice of giving the media a preview of global premieres on the eve of the first press day of the show – known as the “brand night” – instead turned into a “brand afternoon tea.” Five board members at the Group and Mercedes-Benz Cars levels in charge of sales & marketing, R&D, legal & compliance, C.A.S.E. (the acronym for Daimler’s connected, autonomous, shared and electric strategy announced three years ago) and production each spent about 30 minutes telling the media what is new at their respective functions.

Come November 1, Daimler will have a new corporate structure with three legally independent units: Mercedes-Benz AG responsible for Cars & Vans, Daimler Truck AG responsible for Trucks & Buses and Daimler Mobility AG responsible for finance and mobility services, as part of the company’s PROJECT FUTURE initiative for Group structure.

In China, Daimler has a new CEO in Jan Madeja leading its local sales organization Beijing Mercedes-Benz Sales Service Co., Ltd., looking to continue the success and maintain the momentum his predecessor Nicholas Speeks had brought to the brand in the country over the last six years. Daimler also has the most complicated multi-partner relationship among foreign automakers in China: of its three partners BAIC Group, Geely and BYD, the first two are also its biggest shareholders.

Clearly, Källenius has a lot on his plate, trying to stave off competition from his German neighbors while returning his own company back to past profitability levels, and pushing Daimler toward his sustainability goals over the next 20 years via a completely new structure.

China, for Daimler, is its biggest market and will remain so for the foreseeable future. That’s a given. Whether Mercedes-Benz remains No. 1 in sales in the country’s premium segment is no longer important. Balancing the complicated web of relationships it has with its three Chinese partners as well as many other partners and how each of them play a role vis-à-vis C.A.S.E. as Daimler embarks on its sustainable future is more crucial. Källenius has also pointed out that China being the largest market for Mercedes-Benz will have significant influence for what happens over the rest of the world, that goes true not only for design, but sales & marketing, service, IT, R&D, production and AI. Hence the “in China, for the world” motto.

The new role that China plays for Daimler, or for any other foreign automaker for that matter, is elevating from simply a production or sales hub to an innovation hub on all points of the value chain.

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