Mercedes Benz Plans New EQ S Electric Sedan

author: Derrick Smith   

Mercedes Benz is planning to challenge Tesla in the luxury electric car space occupied by the Model S. The company is developing a battery-powered full-size sedan, challenging Tesla and possibly luring away luxury electric-car buyers, Bloomberg has reported.

The new full-size sedan called the EQ S, will be part of the Daimler AG's push to introduce 10 all-electric vehicles by 2022, Chief Executive Officer Dieter Zetsche said Wednesday during the presentation of the revamped Mercedes A-Class hatchback in Split, Croatia.

The EQ line will be joined by other plug-in hybrid models offering a "totally different" battery range than today, while conventional vehicles will feature so-called mild hybrids with 48-volt technology in a shift away from internal combustion engines. "All vehicles will be electrified," Zetsche said.

Mercedes is the world's best-selling luxury-car maker. The company had record deliveries and profits last year. However, the surging costs for the development of battery-powered cars and new digital offerings, plus the threat of trade barriers between the U.S. and China threaten to cut into Damiler's profit margins.

"We would of course welcome additional opportunities," Zetsche said during his presentation, referring to China possibly easing caps on ownership of joint ventures for foreign manufacturers. "We have a very good cooperation with BAIC in China and might come to the conclusion that there won't be any change. But of course it's better to have more instead of fewer options." Mercedes will meet China's planned electric-car quota, Zetsche said.

Tesla has been operating without much competition in the luxury-electric segment since launching the model S in 2012. Although most automakers today are offering at least one electric vehicle in their lineups, most off these vehicle are compact, economical models offering much less range and space than the full size Model S.

With Mercedes and Porsche both planning to release high-end electric vehicles, Tesla must find a way to stave off its rivals in the luxury electric space it once solely occupied.

Derrick Smith