"Daimler Says It Intends To Take on Bosch, Other Suppliers on Batteries for EVs" Green Car Advisor

Daimler Says It Intends To Take on Bosch, Other Suppliers on Batteries for EVs

By Scott Doggett, Contributor

It would appear that Daimler not only views electrification of the automobile as the key to sustainable mobility, but it also views the shift from gasoline- and diesel-powered cars and trucks to electric vehicles as an opportunity for the Stuttgart automaker to compete head on with major automotive parts suppliers.

In an interview today with the German newspaper Handelsblatt, Chief Executive Thomas Weber (pictured) said Daimler -- parent company of Mercedes-Benz and Smart -- intends to compete directly with German automotive parts supplier Robert Bosch and other companies in selling high-performance lithium-ion batteries to third parties.

Weber's comments follow the joint announcement last month by Daimler and German chemical, energy and real estate company Evonik Industries that the two companies had partnered to develop lithium-ion batteries for electric vehicles and hybrids, with the first publicized target for the new batteries being the Mercedes-Benz S400 BlueHybrid due out this year.

Daimler and Evonik made that announcement less than a week after Mercedes-Benz disclosed plans to unveil a trio of BlueZero electric-drive concept vehicles at the 2009 Detroit Auto Show, which starts next Monday, and Daimler's announcement to expand its test program of electric-drive Smart Fortwos from London and Berlin to the Italian cities of Rome, Milan and Pisa.

According to industry forecasts, the market size for high-performance lithium-ion batteries will exceed $13 billion within the next decade. Clearly, Daimler and Evonik Industries want a chunk of that market, as do Toyota, Volkswagen and Renault-Nissan, all of which have recently partnered with battery-makers.

Daimler officials have often stated that electrifying the automobile is the key to sustainable mobility, and they've backed up the statement with more than 200 patents in the area of lithium-ion technology.

But this is the first time a Daimler executive has said the company has Bosch and other parts suppliers in its sights. The suppliers have been hit hard by a sharp drop in auto output, a credit crunch that has made borrowing difficult, and tighter restrictions by credit insurers.

In an effort to remain competitive, Bosch last June teamed with Samsung SDI to form a joint venture to produce batteries for hybrid electric vehicles.

With automakers increasingly manufacturing small cars to improve the overall fuel-efficiency of the fleets they sell, Weber was asked if Daimler intends to produce a greater percentage of them. The answer was a resounding no.

Weber said Daimler intends to rely much more on innovative techologies to improve fuel consumption than merely reducing the size and weight of it vehicles. To that end, he said, Mercedes with offer hybrid technology in every class of its vehicles -- from the smallest A-Class, to the most popular E-Class, to its high-end S-Class -- within four years.

Eventually, vehicles powered by conventional engines will be replaced by electric vehicles powered by batteries and fuel cells, he said. To be successful in coming years, an automaker must realize that and act accordingly.