28 May, 2019

Smooth transition as Källenius aims to decarbonise Daimler

New Daimler CEO Ola Källenius has outlined his plans to help the German carmaker transition to a greener business.

In a brief internal audio message, posted on social media, the Swedish national called on employees to support a new strategy to fully decarbonise its core vehicle fleet over the next 20 years.

‘With 'Ambition2039' we want to make our business more sustainable and simultaneously ensure that it remains a profitable one,’ he said. ‘We need to change, that won't be easy.’

The plan will see Daimler reach a fully carbon neutral fleet by 2039, with 50% of its new vehicle sales being battery electric (BEV) or hybrid by 2030. ‘Let us be clear what this means for us: a fundamental transformation of our company within less than three product cycles,’ said Källenius in a blog post earlier this month. ‘That is not much time when you consider that fossil fuels have dominated our business since the invention of the car by Karl Benz and Gottlieb Daimler some 130 years ago.’

‘But as a company founded by engineers, we believe technology can also help to engineer a better future. Our way to sustainable mobility is innovation – in a holistic approach along the entire value chain.’

Daimler started production of its first fully electric Mercedes-Benz, the EQC, earlier this year, while its Smart brand, in which it has sold 50% to Chinese company Geely, will become a BEV-only business.

To ensure the company’s management follows through with the plan, the new CEO is linking their compensationpackage to the achievement of these CO2 goals.

Smooth handover

Källenius took over the reins at Daimler from outgoing CEO Dieter Zetsche on 23 May, following Daimler’s AGM.

The transition has been smoother than the period when Zetsche took over the position from Juergen Schrempp, following his sudden resignation in 2005. This time, with the former CEO planning his retirement date well in advance, Källenius has been able to learn about and build his new position while waiting for the transfer date. In a move signalling the continuity, the Swede was permitted to announce his Ambition2039 plan more than a week before he officially began his five-year term at the helm of the company.

In his audio message, the first ever non-native German to run the world's oldest automaker said he was excited to begin his duties. ‘I have been at Daimler for more than 26 years, and yet it still feels a bit like it's my first day again,’ he said.

Källenius is seeking to shore up the business and make savings of €6 billion following a drop of 22% in the German carmaker’s operating profit during Q4 2018. This was blamed on trade wars, industry downturn, and the rising cost of electric vehicle development, according to reports.