The internal software development at Mercedes-Benz has hindered the mass production timeline for its new electric vehicles.

Aiming to launch the next generation of electric vehicles ahead of BMW and Audi, the German luxury car brand has begun assigning more software R&D tasks to its Chinese team, who will report directly to Ola Kaellenius, Chairman of the Board of Management and CEO of Mercedes-Benz.

Author | Cao Lin

Editor | Mao Shiyang

Original content by AutoPix (ID: autopix)

01.

Direct Executive Oversight

We have exclusively learned that Mercedes-Benz is expanding its R&D team in China, with a particular focus on software and intelligent cockpit teams, aiming to have the Chinese team take on more MB.OS software R&D tasks.

MB.OS is Mercedes-Benz's intelligent cockpit system developed for its next-generation electric vehicles, aiming to catch up with the advanced software architectures of market-leading electric vehicles. However, the development progress of this system has lagged behind.

According to plans, the MB.OS system will be mass-produced alongside the all-new Mercedes-Benz CLA on the MMA platform. The CLA is the first model in Mercedes-Benz's next-generation electric vehicle lineup, with a concept car expected to debut at a German auto show as early as September 2023. We understand that by November of the same year, the vehicle had already entered Mercedes-Benz's prototype factory in Daxing, Beijing.

Multiple sources revealed that Mercedes-Benz had initially planned to achieve mass production (SOP) of the new CLA in China in May 2025. However, due to the delayed progress of MB.OS, the mass production timeline has been pushed back, with the latest plan being September this year. The timelines we have obtained differ by one month from those reported by domestic tech media, but the delay situation is consistent.

An insider told us that previously, MB.OS development was mainly handled by the Mercedes-Benz R&D team in Germany, with the Chinese team playing a supporting role. Now, many related R&D projects have been gradually transferred to China.

Mercedes-Benz has regional R&D centers in Beijing and Shanghai, China. The teams responsible for MB.OS include the Mercedes-Benz intelligent cockpit R&D team in Beijing, primarily responsible for testing tasks, and the software R&D team in Shanghai, responsible for specific development and troubleshooting.

To support the R&D of MB.OS, the number of R&D personnel in these two teams has exceeded 600 and will continue to expand. A person close to the Beijing team of Mercedes-Benz told us that the regional R&D centers in Beijing and Shanghai are among the few teams within Mercedes-Benz China that still have significant recruitment plans for 2025.

A person close to the Shanghai team of Mercedes-Benz told us that the relevant leaders of the Chinese MB.OS R&D team need to report regularly to Ola Kaellenius, Chairman of the Board of Management and CEO of Mercedes-Benz, on a monthly basis.

▍MB.OS Cockpit of CLA

Compared to Tesla and domestic new energy vehicle brands, the infotainment system used in Mercedes-Benz's new energy vehicles is already one generation behind, which has also led to a delay in Mercedes-Benz's electrification transformation progress.

MB.OS aims to address this lag by decoupling software and hardware, allowing the software of Mercedes-Benz's next-generation electric vehicles to support remote upgrades, with system updates increasing in frequency from once a year to once a month.

Among mainstream traditional foreign automakers, none have yet mass-produced a self-developed software architecture at the same level. Within the BBA (BMW, Benz, Audi) group, BMW's new generation of electric vehicles will be mass-produced in 2026, while Audi's new vehicles based on the Volkswagen SSP platform may not be mass-produced until after 2030.

If the original plan of mass production in April this year goes smoothly, Mercedes-Benz is likely to be the first foreign luxury automaker to launch an advanced architecture.

The software R&D process for traditional automakers has not been smooth. We previously exclusively reported that due to delays in Volkswagen's software, Audi had to postpone the software mass production of its new PPE-platform vehicles, the A5L and Q6L, to after May this year. This delay also affected the Porsche Macan EV on the same platform.

02.

A Test of Mercedes-Benz's Strategy

In late October 2024, MINI officially announced significant limited-time discounts. The price reductions for the two J0X models ranged from 40,000 to 70,000 yuan. Among them, the starting price of the J05 dropped to 163,900 yuan, and the J01 was even lower at 148,800 yuan. These are prices never before seen for the entire MINI brand.

The next generation of new energy vehicles to be launched successively starting in 2025 is the most critical step in Mercedes-Benz's electrification transformation over the past few years.

Mercedes-Benz's current electric vehicle lineup is the EQ series, which was launched in 2018, followed by the EQA, EQB, EQS, and EQE. We previously exclusively reported that due to the failure of EQ series sales, Mercedes-Benz had "halted" a large number of improvement projects for the EQ series in 2023.

From an outsider's perspective, Ola Kaellenius places more emphasis on profit and other operational indicators, which is a timely move by Mercedes-Benz to cut its losses. During the same period as the EQ series, BMW and Audi's electric vehicles of the same generation also encountered issues of insufficient competitiveness in the domestic market. Both brands chose to significantly reduce prices to maintain the market competitiveness of their electric vehicles, causing certain financial pressures.

▍Ola Kaellenius, Chairman of the Board of Management and CEO of Mercedes-Benz

Mercedes-Benz chose to reduce consumption and place its hopes on the next generation of products.

According to plans, Mercedes-Benz has prepared four platforms for its next-generation new energy vehicles, including MMA, MB.EA, AMG.EA, and VAN.EA. Among them, the MMA platform has already planned four new models, including the all-new pure electric four-door coupe CLA, which will be the first product in Mercedes-Benz's next-generation new energy vehicle lineup.

The MB.EA platform will carry Mercedes-Benz's mid-size vehicles. We understand that at least three models are currently being prepared in China on this platform, including three products with code names V520, V530, and V540. These three vehicles will be mass-produced successively after 2026 and 2027, covering most of the product lines of NIO and Li Auto among domestic new energy vehicle brands. Over the past three years, this has been a market segment lost by Mercedes-Benz.

In contrast, the AMG.EA and VAN.EA platforms are slightly niche. AMG.EA is tailored for high-performance vehicles, while VAN.EA is designed for commercial vehicles.

An industry insider familiar with Mercedes-Benz told us that for many years, Mercedes-Benz's electrification transformation strategy has differed from that of some foreign automakers. Many traditional automakers use one to two platforms to cover the next generation of new energy vehicles, focusing their efforts on software, which has led to numerous pitfalls. Mercedes-Benz chose to develop four platforms because it still views hardware and performance as its differentiated advantages in the future era of electric vehicles.

Therefore, unlike Tesla and domestic new energy vehicle brands that conduct extensive in-house research and development in the fields of intelligent driving and intelligent cockpits, Mercedes-Benz achieves its transformation through cooperation with an open supply chain system, leaving ample room for suppliers. Companies such as NVIDIA and domestic intelligent driving company Momenta have entered Mercedes-Benz's supply chain system. Among them, Momenta has developed an advanced intelligent driving system for the new CLA for Mercedes-Benz.

What Mercedes-Benz needs to do is to quickly provide a hardware platform that can support all innovations in the supply chain. However, to achieve this, developing an advanced electronic and electrical architecture and MB.OS system becomes particularly challenging.

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