Daimler CEO Discusses Tesla, BYD, Electric Cars

MAY 3 2015 BY ERIC LOVEDAY 58

Dieter Zetsche Presents Mercedes-Benz F015 - Luxury in Motion

Dieter Zetsche Presents Mercedes-Benz F015 – Luxury in Motion

Daimler CEO Zetsche at the 2013 Frankfurt Motor Show

Daimler CEO Zetsche at the 2013 Frankfurt Motor Show

Because it’s always interesting to hear a CEO discuss another automaker, we present a portion of a Car & Driver interview with Daimler CEO Dieter Zetsche.

Zetsche is asked to discuss electric cars and Tesla Motors.  Here’s that part of the interview.

Q: And electric vehicles? Buyers seem unconvinced.

A: And that is not truly surprising. Put simply, the customer gets a car with less range, longer refueling times, somewhat less space, and a higher price tag. Of course, there are some advantages, like the torque from zero rpm, and there are people who simply want to assume a leadership role in technology. But [customers] are focused mainly on value. As long as there are disadvantages, it will only be possible to gain customers through incentives and subsidies. I am convinced it is the technology of the future, however. The question is how long the transition will take. You can accelerate this process—or let it go its natural course.

Q: Does this mean you believe the internal-combustion engine will go extinct?

A: Yes—in the long run. It will be around for a long time, especially [in regard to commercial vehicles], but passenger cars will increasingly use hybrid powertrains. And eventually even the battery-electric vehicle will sell in relevant numbers.

Q: Daimler sold its shares in Tesla Motors; what role do you expect that company to assume in the wider automotive landscape?

A: If you choose to believe the financial analysts, a very heavy role. First, I have great respect for the work Elon Musk has done so far. Whether he will succeed with his future plans remains to be seen. At least he has managed to offset the aforementioned disadvantages of the electric motor with other fun factors, and he has been more successful at it than his competitors. The big question is whether this success is scalable and whether it can be transmitted to other segments. And I don’t have an answer to that.

Q: Would Mercedes-Benz have gotten away with such a car and all of its compromises?

A: Of course not. But this should not be taken as criticism of Tesla, because their customers are satisfied and proud of their cars. Seen this way, Tesla has done a great job.

Q: Will Daimler be involved in future Tesla models to the same extent as with the Model S?

A: It doesn’t look like it right now. We are always open for talks, but it is not our primary interest to help Tesla develop their next cars.

Q: Some of your competitors want to build “Tesla fighters”—do you?

A: We will most certainly not build a Tesla fighter. We have our own strategy and aim to define our own products. Of course, we observe the competition and try to understand its strengths—but we act, we don’t react. And if we build a fighter, it will be directed at our established competitors, not at Tesla.

Zetsche touched upon its partnership with BYD too.

Q: What are the long-term prospects for your partnership with Chinese carmaker BYD?

A: When we started that partnership, we were convinced that we shouldn’t just go to China to make a profit and send it back home; we also wanted to make a lasting impact. And since the interest in e-mobility is especially strong in China, we set out to jointly develop one with BYD. It was a considerable investment for us, and the Denza has become a really good car. Now we will wait and see how it performs on the market.

Q: Would you export the Denza from China?

A: It is not in our plans, but I don’t want to rule it out.

We’d love to see Denza in the U.S.  It definitely has some impressive specs.  See for yourself here.

Source: Car & Driver

Categories: Daimler, Mercedes, Tesla

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58 Comments on "Daimler CEO Discusses Tesla, BYD, Electric Cars"

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Big Solar

interesting to hear this guys’ comments. pretty straight forward. now if MB could just start building decent cars.

Mike777

My take is this must be comments from 2010.
Clearly, this is the attitude you’d have in 2010, but, Tesla is now selling 35,000 cars a year at $100,000+ dollars each.

But, no, downplay the Tesla threat, my stock will do better.

Brian_Henderson

“I have great respect for the work Elon Musk has done so far. Whether he will succeed with his future plans remains to be seen. … he has been more successful at it than his competitors.”

“if we build a fighter, it will be directed at our established competitors, not at Tesla.”

Of note … CA, HI, GA, & WA market sales not exceed 6% EVs (PEVs & HEVs). By 2020 this region will have a market that exceeds 10% EVs. If it were a country, the region would be in top 5 globally. It’s emerging markets like this where competitors will win/lose opportunities to compete. Nissan and Tesla have established a presence, question is how serious is Daimler at joining the tournament. It’s harder to challenge in a later game if not seriously playing in the early rounds.

Robb Stark

The GA(Atlanta) market appears to be really dependent on selling base LEAFs with a $5k rebate which is going away in July to be replaced with a $200/year fee for BEVs.

We shall see but don’t expect to see GA as a big market for BEVs.

przemo_li

But then those that bought EV right now and invested into solar… wont go gasoline any time soon 😉

Sam C

sour grapes

Robb Stark

So Daimler will not benchmark Tesla but e-tron and i-Series cars? Uhhg.

Chris O

So the way Zetsche sees it Tesla has carved out a niche for itself but not something that would make sense for Daimler to copy as his clients wouldn’t be interested considering the compromises he perceives involved. Not something that is scalable either.

Think many Tesla owners would consider switching to a Daimler product as a compromise and Model 3 should show how scalable the technology really is.

Bob

These comments seems odd to me: “…longer refueling times, somewhat less space,…”
It makes me think that he does not realize how competitive BEVs are (not counting compliance cars).

CP

He told the truth.

speculawyer

Really? It depends on how you think about it. I only spend a few seconds a day to plug-in. I spent MUCH more time fueling gas cars. Space? Has he seen the trunk and frunk of the Model S…it has more space than a Benz.

CP

I hate to interrupt you with facts, but here goes. He was absolutely correct about slower refueling. There’s no question about it. In fact, you’ve got to be a true Kool-Aid drinkin’ EVangelist to argue otherwise.

A gas car refuels at a rate of 5 gallons a minute, and that translates into 140 miles a minute for the average U.S. small car. Even a Tesla “supercharger” maxes out at a recharge rate of about 5.5 miles a minute. My 14 amp, 240v Level 2 charger recharges at a rate of about 0.6 miles a minute.

speculawyer

But you seem unable to understand the full situation. Things don’t have to be identical to be adopted. Mp3s have worse quality than CDs but we love because the convenience of playing them on our cell phones.

Similarly, the slower refueling rate of EVs is largely irrelevant since we all sleep at least 6 hours a day thus allowing us to wake up to a fully charged EV Ready to handle the full days driving needs >95% of the time. If you can’t understand that then that is why you don’t ‘get’ EVs.

CP

Maybe I don’t “get” EVs, whatever that means, but I do have one, whic means that I got one. Anyway, the overnight charging time usually doesn’t matter. But it definitely matters that, fir example, the owner of a Tesla is being told that it’s no problem to stop and cool his heels for 45 minutes every 170 miles.

Speculawyer

A Tesla driver with an 85KWH battery should get over 200 miles if they are driving reasonably. And what is wrong with stopping for 45 minutes every 200 miles? How often do you drive more than 200 miles in a day? For most people, it is extremely rare such that taking a 45 minute break isn’t really a big deal.

But if you do drive more than 200 miles a day quite often then why did you buy an EV when you should have bought a PHEV? You have no one to blame but yourself.

CP

I have two vehicles. The EV is strictly in in-town runabout. I use the ICEV for road trips, which is what anyone with an EV does. I’d be surprised if the Tesla owners don’t have an ICEV in the garage fior just that reason.

Speculawyer

BTW, carefully read what I said. I said ” I only spend a few seconds a day to plug-in. I spent MUCH more time fueling gas cars.” and that is all completely true. Plugging in an EV when I come home at night takes just a few seconds of my time. Every gas station fill-up required a few minutes of my time to go out of my way to gas station, start it filling, wait for it to fill, and pay for the fill-up.

So, yes, I literally spent more of MY TIME on car fueling tasks with the gas car. And isn’t that what really matters? I really don’t care what my car does while I sleep.

Lensman

I don’t often agree with CP, but I do in this case.

If plug-in EVs, including BEVs, were really that popular, then sales would have grown significantly last year. In case you didn’t notice, the rate of growth of sales of PEVs has slowed tremendously over the past two years.

No product with a market segment of only 1% can accurately be called “popular”. The BEV market segment is even less than that.

speculawyer

Evs with long range are still very expensive.

CP

There are no longer range BEVs. A Tesla Model S needs a refill every 150 to 230 miles, depending on weather and driving speed. That’s not “long range,” regardless of the claims.

speculawyer

EPA begs to differ.

CP

Tesloids beg to differ. Not the EPA.

PVH
For established car makers to take real notice it would need: 1/ for Tesla to sale many more (hundred of thousands) cars than it does now. 2/ Make a profit doing that. Many assume Tesla will achieve that, that’s the reason Tsla stock is currently at $230 and not $30. However in most established cars makers mind, the technology is just not mature enough to make a profit making EV’s in significant numbers. I believe even Musk is currently doubting as the least one can say is that there seems to be no hurry on Tesla’s behalf regarding Model 3. If he was convinced there wouldn’t be months delays on trivial issues such as gulf wing doors (model x), the thing would yet be on the market (as it really should, all i can see is a fat model S) and model 3 development would be much more advanced. Then of course there is the GF issue, it probably is a little more complicated than the all EV industry hanging in the air because a plant in Nevada is not finished. I know this is what is written in the EVangelist holy bible but I find difficult to believe (like… Read more »
CP

Wall Street’s been wrong about plenty of high tech companies. I expect Tesla to break into the black at some point, but not by very much. Looks very much like the Model 3 will be their make or break.

By the time they get it out, there’ll be plenty of competition. The key will be developing some cost advantage with that so-called “gigafactory.” I just don’t see it happening, but ya never know.

Lensman

Tesla is investing more than $2 billion in building a battery “Gigafactory” so it can sell its next generation BEV at a significantly lower price than its current models.

Just exactly what do you want Tesla to do, which it’s not currently doing? Tesla doesn’t have a magic wand to lower prices, to reduce charging times, nor to increase the range of EVs.

What Tesla is doing is pushing the EV revolution forward at a pace faster than the natural, profit-driven evolution of the technology. That’s more than you can say about any other auto maker, except possibly BYD. Every other EV maker is sitting around waiting for LG Chem or some other battery maker to start selling batteries at a significantly lower price, before they actually commit to building EVs numbers approaching that of even one popular gas guzzler model.

CP

Oh for God’s sakes, cover your calls. TSLA speculators get crazy, I’ll tell ya.

Nonda Trimis

+1

Ocean Railroader

This sounds like the same bravo from the government and science leaders in Stephen Baxter’s book Flood as the rising global flood breaks past the ten meter mark and is spilling into the coastal cities drowning them. The Scientists keep trying to tell everyone that the flood will stop or not go above the 80 meter mark but in reality the flood gets deeper faster each year.

The Daimler CEO is trying to tell everyone the gas powered car industry that the slowly rising EV flood will slow down at the 80 mile range mark and shouldn’t get any deeper.

If I were a car company I would at least want something to fight Tesla for the shake of not looking stupid not doing anything.

CP

Either that, or he said that MB won’t make a major push into EVs until it can make money with a car that will perform as well as an ICEV. Sometimes a car is only a cigar, as it were.

Jeff D

Yeah, both car and cigar create plenty of pollution, and they will both go up in smoke.

CP

Who cares about pollution when buying a car? I sure as hell don’t, and I have an EV.

V. Bowman

Fortunately not everyone thinks the way you do. There are at least a few who care about the state of this planet and the manner in which we leave it for future generations.

Nonda Trimis

+1 -unbelievable

CP

Couldn’t possibly care less about “the planet” when I decide what vehicle to buy. Call me what you want to, but my attitude is typical. The only difference is that other people won’t be that honest about it.

speculawyer

It is not about caring for ‘the planet’. It is about caring for your children and grandchildren.

But sadly I don’t think that will help persuade you.

CP

You’re right, it won’t. Vroom!

danpatgal

Do you breathe? Do you want asthma or cancer as a result of your breathing?

I agree that many don’t care about pollution when buying an ICE. But that doesn’t mean the attitude is a good or correct one.

Here’s just one data point:

http://www.medicaldaily.com/sudden-cardiac-death-women-linked-how-close-nearest-highway-306908

CP

If you’re trying to shame me, well, it didn’t work. But thanks for the laughs.

speculawyer

You’ve made it abundantly clear that you have no shame.

CP

It’s nice to know that I can occasionally be clear, even abundantly clear.

electric-car-insider.com

Pretending that the emissions from cars doesn’t matter not only ignores the science, but common sense.

It is the accumulation of each of our individual decisions that make the air breathable, or not.

There’s simply no way around that fact. Air pollution is just a different kind of littering.

Mark Hovis

This is not new news either. People have known this through most parts of the industrial revolution, though they accept the numbers as a price for progress. People forget that CARB exists not for global warming but to save lives due to pollution. To deny that ICE’s are killing people is either cowardice for profit, or selective ignorance. I still burn a lot of fuel, but I don’t wear it with pride. That’s a hubris that chills me to the bone.

CP

Thanks for today’s dose of amusing self righteousness!

EVer

No one can build a “Tesla Fighter” its just not possible

CP

Why bother at this point? Tesla loses money. The EV game will get interesting, and when that happens I don’t think Tesla will exist.

Jim

Everybody likes to argue that point. They are following the Amazon strategie. Stock holders have complaining for a decade that Amazon dots not “make money” but the company is worth a lot more. Anyone who understands business accounting understands what is going on.

CP

I understand accounting better than you know. Amazon records a GAAP loss but generates a boatload of cash. Tesla doesn’t generate any cash. They consume it.

peet365

What was he supposed to say? We Mercedes are scared of tesla, believe that their model is better than ours and we will try to catch up?
Mercedes, BMW or VW have probably in their opinion enough time to decide if they need to invest in gigafactories they have enough resources to do so and they want to see if the whole system works. Then they will put a pressure on suppliers.
Tesla will not produce more than 500.000 in any foreseeable future, so they don’t feel any immediate treat. For example what will bring BMW in next 2 years will affect Mercedes much more than whatever Tesla will do.
But when talking about value for money, in 2 years if Tesla will continue improve their offer as they are doing – adding features, improving range and keep building up supercharger network and for new batteries maybe faster charging, than even in Europe Tesla S and X will be best value for money on a market in its price range even for starting models.

Jim

You are correct. They are not going to say that.

What I would like to know is if they see the threat, are working on their own EV, and downplaying it for now or are they missing out on stopping a potential rival. There are many examples of that in history. No competitor saw Google for its potential, so they did not try to compete … until they were playing catch up.

Nukelear

History will repeat itself, like what it did to the big 3 of phones. (Blackberry, Motorola, Nokia)

Jim

I agree. It was also what GM did. Knowing people in the company, back in the 90s, the feeling was, we are number one and no one can take us down. They did not feel the need to be better as they believed they were superior due to sales numbers. Then Toyota over took them. Things became unraveled to the point they would not be around today without a massive involvement by the government.

Boris

He is right when he says that nobody really wants these cars, there is no real demand without the gigantic subsidies of $7.5K plus per car. Who would be buying Volts or Leafs without the big subsidies, just enthusiasts. Tesla is the only company that would have demand even if there was no subsidies. Hopefully Model 3 will work out the way it’s planned, keeping my fingers crossed…

Where he is wrong is about the convenience, MB could easily make cars with 20kwh batteries plus rex and see how they sell, they decided not to do that.

ffbj

I don’t agree. At least concerning the part about there being no demand without the gigantic subsidy. It’s a tax break. Do you even understand how it works? A pretty valueless comment.

Boris

Oh please, so it’s a tax break, not a subsidy, and it so doesn’t matter. But what would you call it when you lease a car, like those 159 a month with 0 down? It’s practically giving those cars out for free. Isn’t it a subsidy to the person who leases the car, they don’t write it off their taxes.

PVH

Wow… I see many here make “valueless” comments according to you. Perhaps you could be kind enough to explain what are the differences between a subsidy and a tax break then ? For a given state budget, if you give a tax break to some you need to forcibly take cash (taxes) from others. So same effect, different words. Or ??
Amiable explanations & some courtesy, I have no doubt you can manage that.

Loboc

Has Daimler market share been dented by Tesla or anyone else?

I think their cars are hideous and over priced, but, somebody is buying them.

Mike

My understanding is that Tesla model S has already taken about 50% of the global large luxury sedan market. (S class, a8, 7 series, Ls 460, Jaguar, panamera, et al). Poof. You bet they have made an impact.

CP

Please tell us where you get your mushrooms, because I want to see in colors too.