Mercedes-Benz maker Daimler plans to invest more than 40 billion euros ($47 billion) by 2030 to be ready to take on Tesla in an all-electric car market, but warned the shift in technology would lead to job cuts.
Outlining its strategy for an electric future, the inventor of the modern motor car said on Thursday it would, with partners, build eight battery plants as it ramps up electric vehicle (EV) production.
From 2025, all new vehicle platforms will only make EVs, Reuters quoted the German luxury automaker as saying.
"We really want to go for it ... and be dominantly, if not all electric, by the end of the decade," Chief Executive Ola Källenius told Reuters, adding that spending on traditional combustion-engine technology would be "close to zero" by 2025.
However, Daimler - to be renamed Mercedes-Benz as part of plans to spin off its trucks division later this year – stopped short of giving a hard deadline for ending sales of fossil-fuel cars.
Some carmakers like Geely-owned Volvo Cars have committed to going all electric by 2030, while General Motors Co says it aspires to be fully electric by 2035, as they all try to close the gap to industry leader Tesla.
"We need to move the debate away from when you build the last combustion engine because it's not relevant," Källenius said. "The question is how quickly can you scale up to being close to 100% electric and that's what we're focusing on."
Daimler shares rose as much as 2.5% after the news, which comes just over a week after the European Union proposed an effective ban on the sale of new petrol and diesel cars from 2035 as part of a broad package of measures to combat global warming.
Ahead of the EU's announcement, carmakers had announced a series of major investments in EVs. Earlier this month, Stellantis said it would invest more than 30 billion euros by 2025 on electrifying its line-up.