The German Car Industry Musters for a New Tech Battle

Having spent years—and tens of billions of dollars—preparing for a shift in production toward electric vehicles, German car makers are expressing a new angst: that digitally “connected cars” could prove even more disruptive to their traditional strengths. This second leg of their race against Tesla could become a fresh excuse to squander investors’ capital.

Daimler set two priorities for technological leadership in a new strategy for its

Mercedes-Benz


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brand this week: electric drive and car software. For the latter, the company is working on an entire operating system, MB.OS, that from 2024 will run not just Mercedes’s proprietary infotainment system and its mobile broadband connection but also crucial elements of the driving experience, including self-driving features and battery management.

The company will partner with technology specialists for specific applications, notably

Nvidia

for automated driving. Yet the closer the software gets to the customer experience, the more Daimler wants

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