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23 May 2019, 12:19
Julian Wettengel

Daimler CEO announces sweeping cost review as he bows out; new Group structure

Reuters / Daimler

Daimler鈥檚 outgoing Chief Executive Dieter Zetsche has announced a sweeping cost review as he bid farewell to shareholders following more than a decade at the helm of luxury carmaker Mercedes-Benz, writes Ilona Wissenbach . 鈥淓verything is under scrutiny: fixed and variable costs, material and personnel costs, investment projects, vertical integration and the product range,鈥 Zetsche told the company鈥檚 annual general meeting in Berlin. The shift toward electric cars, a sputtering global economy and rising costs to keep combustion engines clean have hit car industry margins hard, forcing even profitable businesses like Daimler to renew cost-cutting efforts, writes Wissenbach. Pressure to develop electric and autonomous cars has seen research and development expenditure costs at Mercedes-Benz passenger cars rise to 14 billion euros from around 8 billion euros four years ago. , creating legally independent entities for car and van business and for truck and bus business by way of a spin-off. The aim is to enhance Daimler鈥檚 鈥渄egree of innovation and agility in order to react quickly to changes鈥 in a new era of mobility. Zetsche is succeeded by Swede Ola Kaellenius, who previously headed the carmaker's research department.

German carmakers have announced plans to substantially ramp up the share of e-cars in their portfolio as stubbornly high transport sector emissions increasingly shift into the focus of climate action advocates. In mid-May, the world鈥檚 oldest carmaker Daimler said it aimed to bring the share of e-cars in its sales to 50 percent by 2030 and to achieve a 鈥渃arbon-neutral passenger car fleet鈥 by 2039. Plug-in hybrids, or all-electric cars, will make up half of its fleet at the end of the next decade, the company said聽on its so-called 鈥淎mbition 2039鈥. It also announced 鈥淐O2-neutral production in Europe as of 2022鈥 as well as an 鈥渁greement on concrete CO2 measures with suppliers and joint design of infrastructure鈥.

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