Mercedes Launches a Fleet of Electric Cars to Challenge Tesla, BMW

Aug 08, 2016 10:10 AM EDT | Tina L.

German automaker Mercedes-Benz is set to challenge Tesla Motors Inc. and BMW by launching its own line of electric vehicle. The carmaker plans to add two alternative-fuel sport utility vehicles as well as two sedans to its existing line of vehicles. In addition, Mercedes-Benz may develop a sub-brand for vehicles.

In June, the company's Chief Executive Officer Dieter Zetsche said Mercedes-Benz will introduce an electric car at the Paris Motor Show. Previously, the automaker announced plans to present new electric vehicles by the end of 2020.

According to insiders, it was the success of Tesla's Model S sedan that pressured other luxury automakers to develop electric cars.  The Model S reportedly took a huge chunk of the high-end market.

Stricter emission regulations are also seen as reasons why more car makers are coming out with their own alternative-fuel vehicles. However, this was not Mercedes' first time delving into the electric car segment. The German carmaker previously introduced batteries and electric-powered motors to its existing models. The move was meant to provide a cheaper solution to rival BMW's shift to carbon fiber.

Apart from introducing new electric car models, Mercedes is set to introduce its first heavy-duty delivery truck with an all-electric engine. The automaker also promised that all models in the Smart city-car brand will come with an electric version.

"When Tesla started coming up many years ago we decided at the time, and I believe correctly, that the technology wasn't quite ready," Wolfgang Bernhard, Daimler's trucks chief, said in an interview at the urban e-truck's unveiling. "Now we believe the time has come to earn money in e-mobility over the next five to 10 years."

Meanwhile, Daimler's spokesperson Christopher Sedlmayr did not elaborate what number or models of electric cars Mercedes-Benz are set to introduce. Insiders believe that Mercedes' electric cars will feature above-average real-world range of 250 miles/400 km.

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