Mercedes, BMW and the Transformation

Although some people are skeptical of the impact that ride-hailing and ride-sharing may have, that skepticism can, in large part, be allayed by the announcement last week that the BMW Group and Daimler AG are going to be merging their mobility services business units.

The plan is to create a joint-venture with each of the two companies owning half.

The obligatory executive quotes about what each of the companies is doing and what the combination portends are worth looking at:

Harald Krüger, Chairman of the Board of Management of BMW AG:

“The BMW Group is shaping future mobility – and striking out in new directions to do so. Our Strategy NUMBER ONE > NEXT provides the BMW Group with a roadmap to a digital and emission-free future. Combining our mobility services as planned will create a unique digital ecosystem. This alliance will make it easier for our customers to discover the emission-free mobility of the future. We remain competitors when it comes to the best premium vehicles. The planned merger of our mobility services will pool our resources and sends a strong signal to our new competitors.”

Dieter Zetsche, Chairman of the Board of Management of Daimler AG and head of Mercedes-Benz Cars:

“As pioneers in automotive engineering, we will not leave the task of shaping future urban mobility to others. There will be more people than ever before without a car who will still want to be extremely mobile. We want to combine our expertise and experience to develop a unique, sustainable ecosystem for urban mobility. At Daimler, we are vigorously and systematically pursuing our transformation from automobile manufacturer to provider of mobility services with our CASE strategy. CASE stands for connectivity, automated driving, sharing & services and electric mobility."

It should go without saying that BMW and Mercedes are vigorous competitors.

Yet there is an obvious recognition by both companies that there are “new competitors,” “others,” who are making their way into this space (Uber, Lyft, Waymo), companies that have heretofore been comparatively absent from the automobility space. And these two traditional companies realize that in order to be even more competitive they need to do things that they otherwise would be unlikely to do—like collaborate.

So they’ll be offering on-demand mobility with moovel and ReachNow; car sharing with Car2Go and DriveNow; ride haling with mytaxi, Chauffeur Privé, Clever Taxi, and Beat; and for those who have their own car and need to find a place to park, ParkNow and Parkmobile; and for those who have an electric car and need a place to charge, ChargeNow and Digital Charging Solutions.

The automotive landscape is perhaps changing right now more than at any time since the early years of the industry. When you have someone like Dieter Zetsche talking about transforming Mercedes into something that isn’t an automobile manufacturer (yes, but one that will still build and sell and deploy autos), you can know this change is real.