Mercedes-Benz continues to realign its global production network towards electric vehicles as the world’s most valuable luxury car brand prepares to go fully electric by the end of the decade – wherever market conditions allow. Mercedes-Benz has retooled its production setup for electric drive systems (batteries, electric drive units and axles) from 2024, following the realigned production setup for electric vehicles based on future vehicle architectures earlier this year (Further information: https://group-media.mercedes-benz.com/marsMediaSite/ko/en/53631676). The new setup within the Mercedes-Benz powertrain production network was achieved following constructive discussions with German employee representatives, resulting in agreements to further increase flexibility and efficiency at the various locations, paving the way for securing the future of the plants. In line with the implementation of the Mercedes-Benz Business Plan, the company is investing a mid-single-digit billion euro amount in its European powertrain production locations.
Jörg Burzer, Member of the Board of Management of Mercedes-Benz Group AG, Production and Supply Chain Management:
“The successful launches of the Mercedes-EQ models in recent months show that our global production network has long since arrived in the electric era. Today, our global powertrain production network is already supplying the Mercedes-EQ vehicle plants with state-of-the-art batteries and electrified axles. With the new production setup, our powertrain plants are now optimally positioned for the new vehicle architectures from 2024. Sustainable, digital and flexible, our highly qualified and motivated colleagues around the world are now preparing for the rapid ramp-up of electric drive systems.”
The battery plants in Kamenz, Brühl (Untertürkheim) and Beijing (China) will produce batteries for the new models on the MMA and MB.EA platforms. The establishment of battery assembly at the Kölleda location, which is currently responsible for making conventional and hybridised engines, is also planned – subject to the support from the Thuringian state government. The state government has pledged corresponding support in a letter of intent, paving the way for the plant’s electric transformation process. The Untertürkheim, Sebes (Romania) and Beijing plants will produce electric drive units for the new models on the MMA and MB.EA platforms from 2024. As previously announced, the Untertürkheim plant will double its production capacity for electric drives to one million units (Further information: https://group-media.mercedes-benz.com/marsMediaSite/ko/en/54709944). The Mercedes-Benz plants in Hamburg and Untertürkheim (Mettingen section) will remain the German lead plants for the assembly of electric axles and components, and will supply the production network of Mercedes-Benz body plants with next-generation systems. As announced last year, the Mercedes-Benz plant in Berlin will produce high-performance electric motors for the future AMG.EA platform from the middle of the decade.
Ergun Lümali, Dep. Chairman of the Supervisory Board and Chairman of the Works Council of Mercedes-Benz Group AG:
“The path towards sustainable, all-electric mobility has begun. As the General Works Council, we are committed to shaping this change, which is both a challenge and an opportunity, in a fair and socially just manner. In the realignment of the global production setup with regard to all-electric vehicle architectures, we demanded from the outset: The German locations must play an essential role. In the summer, we were already able to agree on visions of the future for the vehicle plants. It was always clear to us that we wanted to achieve this for the powertrain locations as well. Our persistence has paid off. I am pleased that we have created security and clear prospects for our colleagues in the powertrain production network.”
Transformation to Electric Only
The Mercedes-Benz powertrain production network is in the middle of a process of transformation. Plug-in hybrids and fully electric vehicles are expected to account for around half of unit sales by as soon as 2025. Conventional drive units will therefore remain an important part of the Mercedes-Benz drive portfolio in the medium term. With increasing electrification, demand will shift towards e-mobility components, batteries and electric drive systems. The company’s sustainable realignment towards a purely electric product range necessitates extensive adjustments to structures and processes, and requires a high degree of flexibility – also in the powertrain production network. The basis for the transformation is a comprehensive training and retraining programme for the employees at the locations. With the launch of the new organisational unit Mercedes-Benz Drive Systems, the company reorganised its drive division back in 2020. With the organisational bundling of all Group-wide drive system expertise from the areas of development, production, purchasing, controlling, human resources, planning, logistics and quality under one roof, the company is consistently orienting its drive system division towards CO2-neutral mobility.
Overview: The Mercedes-Benz powertrain production network
The Mercedes-Benz powertrain production network consists of 14 locations on three continents, providing drive systems, major assemblies and components for the entire Mercedes-Benz powertrain portfolio. It supplies the Mercedes-Benz body plants around the world. The planned battery recycling plant at the Kuppenheim location is also part of this network. Since this year, Mercedes-Benz has been producing on a CO2-neutral basis in all its own plants worldwide and purchasing electricity that comes exclusively from renewable sources. In addition, the company aims to increase the generation of renewable energy at its locations.
The Mercedes-Benz Untertürkheim plant is the largest location in the global Mercedes-Benz powertrain production network, and extends over a series of sub-plants in the Neckar valley. Conventional engines and components are currently produced in Untertürkheim and Bad Cannstatt. The forge is also located in Untertürkheim. The Mercedes-Benz eCampus, a competence centre for research and development of future generations of batteries and battery cells, is also being built here. Further information: https://group-media.mercedes-benz.com/marsMediaSite/ko/de/53398564). From 2024, the ramp-up of electric drive units will begin in Untertürkheim and Bad Cannstatt. In the target scenario, one million electric drive units can be produced, for example for vehicles on the MMA (Mercedes Modular Architecture) platform. Flexible drive axle production and the foundry are located in Mettingen. From 2024, parts of the electric drive units will be manufactured here and assembled into electric axles. Transmission production takes place in the Hedelfingen sub-plant. Since 2021, battery systems for the Mercedes EQ models EQS and EQE have also been produced here. The sub-plant will also manufacture parts for electric drive units from 2024. Training is based at Brühl. Since this year, a new factory in Brühl has also been producing batteries for the latest plug-in hybrid generation. From 2024, the ramp-up for battery production for new all-electric EQ models will start here. Flexible production is located in Sirnau. The Untertürkheim site also houses a large part of the Group-wide drive research and development, with a test track for vehicle testing. Untertürkheim is also the location of Mercedes-Benz Group AG headquarters.
Kamenz (Accumotive GmbH and Co. KG.)
Two factories in Kamenz, Saxony, have already been producing battery systems for hybrids and electric vehicles since 2012. The second battery factory at the site started operations in 2018, and has been producing the battery systems for the EQC since 2019 and for the compact electric SUVs since 2021. Since Accumotive started production, more than two million batteries have been produced at the Kamenz location. From 2024, battery production for new all-electric Mercedes EQ models, starting with the MMA platform, will commence in Kamenz.
Kölleda/Germany (MDC Power GmbH)
The engine plant in Kölleda has been assembling four-cylinder petrol and four- and six-cylinder diesel engines for Mercedes-Benz vehicles with conventional and electrified drive systems since 2003. More than 12 million engines have left the production line in Kölleda since then. The sister plant in Arnstadt produces components for engine production. The new production setup of the Mercedes-Benz powertrain production network envisages the establishment of battery assembly for new all-electric Mercedes EQ models at this location. Subject to the support of the Thuringian state government, this is to be realised from the middle of the decade on. The state government has promised corresponding support in a letter of intent.
The Mercedes-Benz plant in Hamburg has been part of the global Mercedes-Benz production network since 1978. Its portfolio includes various powertrain components ranging from axles and axle components to steering columns and lightweight structural parts, plus exhaust technology components. In addition, the plant also assembles integrated starter-generators. Since 2019, Hamburg has supplied the Bremen plant with electric axles for production of the EQC – and since 2022 also for the EQE. From 2024, the plant will take over production and assembly of the electric axles and components for a model on the MB.EA platform, supplying the plant around 100 km away.
Founded in 1902, the Berlin plant is the oldest Mercedes-Benz manufacturing location and is responsible for the production of various drive components, among them camshafts and camshaft adjusters. With the integration of electric drive components, the plant has already set an important course for the future: The portfolio of the Berlin plant already includes assembly operations for electric drive units as well as the so-called EE compartment, the electric control unit of a battery. In addition, the plant plays an important role in the digitalisation of production within the global network, with the recently opened Mercedes-Benz Digital Factory Campus (Further information: https://group-media.mercedes-benz.com/marsMediaSite/ko/en/54178408). With the assembly of high-performance electric motors, the location will expand its electric portfolio from the middle of the decade. Mercedes-Benz announced the acquisition of the British electric motor company YASA last year. By doing so, the company has secured access to unique technology in the field of axial-flow electric motors, and increased its own value creation in development and production by insourcing drive technologies for electric vehicles.
The Mercedes-Benz battery production network will also be supplemented by a further battery factory at the Sindelfingen location.
The construction of a dedicated pilot plant for recycling lithium-ion battery systems is planned on the site of the Mercedes-Benz Kuppenheim plant. Construction of the plant is to take place in two stages. In close cooperation with the responsible authorities, a plant for mechanical dismantling is first to be built before the end of 2023. Preparatory measures for this have already begun. In a second step, the facilities for hydrometallurgical processing of battery materials are to go into operation – subject to talks with the public authorities.
The Mercedes-Benz plant in Jawor, Poland, started production of highly efficient four-cylinder petrol and diesel engines in 2019. Since 2020, the location’s battery factory has been supplying plug-in hybrid batteries for the C, E and S-Class to the company’s global production network. In 2021, the location expanded its portfolio to include battery systems for the compact Mercedes EQA and EQB models. Moreover, the location is to become new member of Van production network. In a new plant the large vans (closed model/panel van) on VAN.EA basis are to be produced there in the future. (More information: https://group-media.mercedes-benz.com/marsMediaSite/ko/en/54767461)
Sebes (Star Assembly SRL) & Cugir (Star Transmission SRL)
The Sebes and Cugir plants in Romania are wholly-owned subsidiaries of Mercedes-Benz AG. Automatic transmissions for Mercedes-Benz have been assembled in Sebes since 2013. The sister plant in Cugir is home to the production of various components for engines, transmissions and steering systems, as well as the technology centre e.g. for prototype production. From 2025, the ramp-up of electric drive units for new all-electric EQ models will begin at Sebes.
Maribor (Starkom d.o.o.) & Most (Starcam s.r.o.)
The subsidiaries Starkom in Maribor (Slovenia) and Starcam in Most (Czech Republic) supply the powertrain production network with various production components. The Most plant, for example, is responsible for the entire value chain of cylinder heads for four-cylinder diesel and petrol engines. The Maribor plant produces rear axle beams and corresponding components for Mercedes-Benz models – in future also for Mercedes-EQ.
The new battery factory in Bibb County near the Mercedes-Benz vehicle plant in Tuscaloosa, Alabama (USA), started operations this year. It produces highly efficient battery systems for the all-electric EQS SUV and EQE SUV, which are already running off the production line since this year.
Beijing Benz Automotive Co. Ltd. (BBAC) has established local engine and battery production at the existing site on the Yizhuang Industrial Park in Beijing (China). It supplies the Chinese vehicle plants for local production. The engine plant was commissioned in 2013, and covers the local supply of four-cylinder petrol engines. Production of batteries for the EQC started in 2019. Production of batteries for the EQE commenced this year. From 2025, the ramp-up of electric drive units and batteries for new all-electric EQ models will begin.
In 2019, Mercedes-Benz opened a battery production plant in Bangkok, Thailand, together with local partner Thonburi Automotive Assembly Plant (TAAP). Battery systems for plug-in hybrids and fully electric vehicles are manufactured and delivered to the vehicle plant, which is also based there.