Daimler to cut out suppliers to fund software hiring spree

Parent of Mercedes Benz wants an operating model to rival Tesla

The Mercedes-Benz owner will buy fewer electronic components and “replace supplier development costs with personnel, building and computing costs”.  Photograph:  Michaela Handrek-Rehle/Bloomberg

The Mercedes-Benz owner will buy fewer electronic components and “replace supplier development costs with personnel, building and computing costs”. Photograph: Michaela Handrek-Rehle/Bloomberg

 

Daimler will cut out traditional parts-makers in order to fund a software development push that will involve hiring thousands of coders to build an operating system that rivals that of Tesla.

The Mercedes-Benz owner would buy fewer electronic components and “replace supplier development costs with personnel, building and computing costs”, Ola Kallenius, the company’s chief executive, told the Financial Times.

The German group, which is in the middle of a painful restructuring as it struggles to pay for a late foray into electric vehicles, wants to own more of the complex technology that powers modern cars.

“We want to have one comprehensive operating system that goes from our A class to S class [cars],” Mr Kallenius said, citing Apple’s iOS, which powers the iPhone, as inspiration.

In a bid to offer customers a more seamless experience, and own the data produced by connected cars, Daimler is moving more software development in-house.

Separately on Thursday, Daimler announced it would propose BMW and VW veteran Bernd Pischetsrieder as head of its supervisory board once Manfred Bischoff’s term ends next year. – Copyright The Financial Times Limited 2020