Mercedes-Benz sums up its new focus with four letters: CASE.
Renting your vehicle for four or eight days a month can pay most – or all – of your lease.
The acronym stands for “connected, autonomous, shared, and electric.” Company officials are so serious about these trends that they turned CASE into a standalone unit. It’s a fast-moving team of experts with broad responsibilities that include working with startups to launch car-sharing programs and overseeing the development of a brand-new, modular electric platform.
We met up with Axel Harries, the head of CASE, to get insight on how and why these four trends are already having a profound effect on Mercedes’ product plan, and what’s next.
Digital Trends: Why is Mercedes shifting towards electric vehicles?
Axel Harries: For us, it’s crystal clear that the market is heading in this direction, and that we’re in a very, very strong position to make a big contribution. Last year was our most successful year ever, the first two months of this year have been perfect, so the timing is right to shift gears and go all in into electric mobility.
And what’s driving the shift towards car-sharing?
Moving forward, the lines between owning a car, using a car, and sharing a car will be blurred. Combined, for example, with autonomous driving, you’ll end up with a new business model. Those are the trends that will change customers’ mobility behavior, and therefore they’re part of our strategy to really shift from being a classic automotive manufacturer today to a full service mobility provider tomorrow.
That’s why we set up CASE. We see ourselves as a speedboat. We can always hook up to our mothership, Mercedes, and benefit from its huge amount of technical know-how, but we can also move fast into new terrains. For example, we recently launched a peer-to-peer car-sharing platform named Croove in Munich, and we accomplished that in just three months. Those are the kinds of things we’re trying to do. Our investment into ChargePoint is another example.
If I drove a Chevrolet Spark, I probably wouldn’t mind sharing it because it’s a relatively cheap economy car. Do you think you can convince the owner of a $100,000 S-Class to share his pride and joy with a random person?
Nobody would have ever imagined people would be willing to rent out their apartment or their house to a complete stranger; the same thing is happening to vehicles with these peer-to-peer platforms. They need to be trusted platforms, though. It’s a completely new ball game. Renting your vehicle for four or eight days a month can pay most – or all – of your lease.
There are interesting new business models spawning from these platforms, and that’s why we’re interested in gaining an understanding of what’s going on. They give customers a new opportunity for mobility. We also see that people rent vehicles because they want to drive an upgraded vehicle for a weekend. We have to understand that having mobility at your fingertips is completely different than owning a vehicle, which was the main mobility activity in the past.
What are the hurdles standing in the way of autonomous cars?
First, we should talk about the definition of autonomous driving. Right now, we use the term “driver assistance package” which we feel sums up where we are pretty well. When you talk about a later stage, such as level four or level five autonomy, you talk about fully autonomous driving, and technologically speaking that’s a big step which needs further improvements.
When it comes to autonomous driving we feel it’s crucial [not to release beta software] from a safety perspective.
It’s important to understand that Mercedes’ clear task is providing our customers with solutions that work. For us, it’s completely impossible to imagine letting customers go with a beta version of something related to autonomous driving. That’s not what we intend to do. It’s different for other types of software, it’s actually pretty normal now to let customers participate in the development process, but when it comes to autonomous driving we feel it’s crucial [not to release beta software] from a safety perspective. Safety is a core value of Mercedes-Benz, and we have to stick to that.
It’s important to have a very advanced technological package, and we’re going to take the time to develop it. With or without partners; we’re open to that, too. Regardless, we will have a solid autonomous solution in a couple of years.
Does that mean one day we’ll be able to buy a Mercedes without a steering wheel?
Right now, we feel the steering wheel will be part of the vehicle for a pretty long time. However, there might be a point in time where the driver’s seat is not a driver’s seat anymore, it’s just a seat like any other in the vehicle.
How does infotainment tie into level four and five autonomy?
With autonomous driving, people will have a lot more free time. How they use this time efficiently ties into your question. We need to design an intelligent interior, one that provides the customer with everything he or she needs to use this new time in the most efficient manner.
Tell us more about your plans for electrifying the Mercedes lineup.
Our new brand is EQ, which stands for electric intelligence. Now that it’s established, it’s important to ramp up our product portfolio. The first is the production version of the Generation EQ concept, which is coming out in 2019. It’s going to be close to the concept, but I can’t give you more details.
Then, there is a whole range of EVs coming in the next couple of years. And we’re electrifying AMG, too, with EQ+ models like the GT concept you saw in Geneva. With it, we’re even demonstrating the connection to Formula 1 technology. We need a holistic approach.
Do you think that the shift from gasoline-powered cars to electric cars can happen without government support?
The shift is already happening. We believe that in 2025 15 to 25 percent of all Mercedes-Benz vehicles will be electric or hybrid. Having said this, these numbers might change; in some areas, we might even see a faster ramp-up. We also feel that we need to have certain flexibility. When demand for gasoline- and diesel-powered cars goes down, we need to have electric vehicles ready and let the customer judge when the time to make the switch is right.
We strongly believe the customer will have a real alternative. That’s why we decided to be flexible in terms of production, too. It will be possible to build a gasoline- and battery-powered models on the same assembly line. We are ready to fulfill customer needs.
When you talk about electrified cars, does that include hydrogen-powered models?
Hydrogen technology is part of CASE, yes. We’re going to introduce a GLC F-Cell in the fall of this year, and it’s going to launch next year.