Mercedes boss commenting that EV costs will remain high for the foreseeable future

Ola Kaellenius’ comments came as Mercedes-Benz revealed additional information about its newest electric vehicle architecture, the CLA compact electric sedan, which will premiere next year and aim for a 30% to 35% increase in driving range.

The variable costs of producing electric vehicles will stay higher than those of combustion engine models for the foreseeable future, according to Mercedes-Benz’s CEO on Sunday, fueling strong competition.

Ola Kaellenius’ comments came as Mercedes-Benz revealed additional information about its newest electric vehicle architecture, the CLA compact electric sedan, which will premiere next year and aim for a 30% to 35% increase in driving range.

Also read: Mercedes-Benz Unveils Its Latest Vision One-Eleven Concept

“The variable costs associated with an electric vehicle are higher.” “That will be the case for the foreseeable future,” Kaellenius told media at the IAA vehicle exhibition in Munich, adding that additional expenses could not be passed on to customers on a like-for-like basis.

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Raw materials for batteries, software development, and electricity rates are all variable variables that affect the price of EV production.

This, according to Kaellenius, is why the business is aiming to optimize fixed costs and resource allocation in order to achieve the same profitability with electric cars as it could with combustion engines.

The new CLA aims for a power consumption of 12 kilowatt hours per 100 kilometers and a driving range of 750 kilometers, compared to the 17 to 18 kWh per 100 kilometers offered by Mercedes’ current EQA 350 compact SUV model.

When asked how much the new CLA class cut expenses over the previous generation, Mercedes-Benz Chief Technology Officer Markus Schaefer stated the company was aiming for a 50% cost reduction.

CATL and ACC, of which Mercedes owns a third, will manufacture batteries for the CLA.

The CLA, which will go into production next year and hit the market in 2025, is an attempt to reduce model development complexity, which has expanded dramatically in recent years, according to Schaefer.

Mercedes-Benz will offer hybrid and all-electric models, but no diesel models are in the works.

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