Mercedes-Benz Group AG (MBG) Earnings Call Transcript & Summary

This is our journey, the most important journey of our time, beyond anything we have tried before. Let us bend reality to make the impossible possible. The vision is individual mobility reimagined. The mission is efficiency. It all comes together in a Mercedes-Benz VISION EQXX. Driven by passion and a pioneering team spirit, this car paves the way to a brighter future. On our electric mobility journey, we're breaking through boundaries, exploring new roads, challenging ourselves and others. Join us.

Welcome to 2022. I hope you had a chance to relax and recharge over the holidays. We did and we have big plans for this new year. It's a year to show what our teams are truly capable of, reinventing the car as we know it. The VISION EQXX started just 18 months ago as a visionary technology program, advancing in ways we never thought possible. With the EQS, we brought the most aerodynamic production car to the road, and our teams didn't stop there. Creating the VISION EQXX, their outstanding engineering skills led to an even lower drag coefficient with a value of just 0.17. Such a small figure makes a big impact by getting more range out of each battery charge. Technology, design, aerodynamics, a radically new drivetrain and all other measures combined deliver unprecedented efficiency. They led to an all-electric range of more than 1,000 kilometers or 620 miles on one charge and without just putting a bigger and heavier battery in the car. Quite the opposite. The VISION EQXX is all about creating a holistically better electric car that looks stunning and futuristic, too. I'm incredibly proud of what this team has put together on a very tight schedule. The VISION EQXX is a statement. It's the most efficient Mercedes ever, and it's a trailblazer, which underlines where our entire company is headed. We will build the world's most desirable electric cars, cars like this one.

What a fantastic opportunity to create a vision of the future and to define what the future of luxury will be. Our vision is defined by our way of luxury through beauty and the extraordinary. Through design, we set the stage for technology in all 3 dimensions of exterior, interior and UX and create an extraordinary X-factor. For the first time, Mercedes is using a game engine to elevate the user experience to the next level of digital luxury. We created use cases and visuals never seen before in the car industry and, through this, explore new possibilities to create extraordinary solutions, our X-factor. We transformed our zero-layer concept into a 3-dimensional world using the map as an interactive menu. Our Mercedes star-cloud avatar gives the car an AI-based digital soul that takes care of you all the time. In the interior, it's all about a free-floating one-piece display. This minimalistic and high-tech design approach echoes throughout the entire interior with lightweight seats as well as the free-floating center tunnel. New sustainable materials throughout the interior like bamboo fiber, AMSilk or Mylo showcase a whole new level of responsibility. It provides all you need, no more, no less. The exterior is a sculpture of beauty and the extraordinary. Applying our philosophy of sensual purity, we created spectacular proportions that combine beauty with efficiency. The resulting body flow delivers revolutionary aerodynamics. And combined with clean, s*** surfacing, the looks is extremely futuristic. The VISION EQXX is a vision of the future that embodies the desire for the next level of luxury from Mercedes-Benz.

The VISION EQXX is the result of an exceptional cross-functional team effort. We didn't set ourselves any limits in our thinking. Our goal was to build the most efficient Mercedes ever. We used the most fantastic digital tools to speed up our development processes. This helped us figure out really quickly what works and what doesn't. Our star, the e-drive system, achieved a remarkable 95% efficiency. Compare that to 75% of a current EV. We challenged the best of the best, our colleagues from Mercedes AMG High Performance Powertrains, to come up with the best technical solutions.

And we took up the challenge. Welcome to HPP here at Brixworth in the UK. With our Formula 1 work, we're really used to very fast-paced ambitious projects. With VISION EQXX, with its highly ambitious goal of a single-digit kilowatt hour per 100 kilometer, we knew how we had to tackle it. That meant squeezing lots of energy into a very small battery. So with our colleagues in Stuttgart, we redesigned it from scratch, giving it more capacity from a smaller, lighter package. And with the innovative hardware and software, we also gave it more long-distance stamina. We also need great power electronics. The result is an amazingly efficient lightweight unit. The final piece of the jigsaw is the electric motor. This was led by our colleagues in Stuttgart. But we worked together to share all the knowledge we've got from Formula 1 and racing over many years. VISION EQXX was a hugely ambitious project and one we could only tackle with amazing teamwork. Right Jasmin?

Right, Adam. But the VISION EQXX is not just about efficiency. It's also about the sustainability of its design.

Progressive luxury in design is all about making bold decisions and redefining the meaning, feel and look of luxury. We first showcased this in the VISION AVTR, our groundbreaking concept vehicle from CES 2020 made in collaboration with Avatar filmmakers. Our inspiration is a more balanced relationship with nature. This still means comfort and style, but also finding lightweight materials with really small environmental footprints like door pulls made from a biodegradable vegan silk and carpets make from bamboo. The door pulls mark the first use in the automotive of biotechnology based on material invented by AMSilk. And for our seats, we found 2 amazing leather alternatives: Desserttex made from cactus; and Mylo made from the root-like structure of mushrooms. Mylo is a biomaterial made for mycelium. It takes just 2 weeks to grow with 100% renewable energy and has the look and feel of leather, but it's completely animal-free. These materials from exciting startups offer new avenues of creativity and the visual and tactile finishes are absolutely gorgeous.

It's been an incredible journey. The task to the team was simple, push the boundaries of engineering. The result is a completely new development approach for electric vehicles and potential cost efficiencies for series production. This is also a major milestone for Mercedes-Benz as a software-driven company, and it brings us even closer to a more seamless human-machine merge. For instance, the one-piece display helps car and driver work together to achieve an even greater efficiency. But the journey is far from over. The vision EQXX demonstrates future Mercedes technologies. Our customers will see that we are delivering more with less, more range with less energy, more luxury and convenience with less impact on nature, more individual electric mobility with less waste because efficiency is the new currency. And our team has shown that all the details add up to remarkable benefits. Our aerodynamics experts worked with our designers to achieve a drag coefficient of just 0.17. The VISION EQXX also has solar panels on the roof powering several functions and delivering extra range. We achieved a single-digit kilowatt hours per 100 kilometers consumption, which equates to over 6 miles per kilowatt hour. In conventional terms, that's around the same as a 1-liter car or 235 miles per gallon. We packed the energy of the EQS into the dimensions of a compact car. And with bionic engineering, we are pioneering new methods and materials. All the achievements in the VISION EQXX make me very proud of the entire team. The VISION EQXX is a car with a mission, and that is than just a metaphor. In spring, we will prove to the world that the road-legal VISION EQXX has a real-life electric range of more than 1,000 kilometers, and we will make it look easy with cutting-edge technology, efficiency and typical Mercedes luxury and style. So stay tuned.

Thank you all very much for watching the digital world premiere of our VISION EQXX. If you'd like to know more about the most efficient Mercedes ever, take a look at our Mercedes me media site. To make things as easy as possible for you, we've prepared an in-depth VISION EQXX special packed with text, with social content and photos as well as many more insights into this remarkable project. And we've also included a Q&A function on our me media platform to help with your questions. But you can, of course, also reach the Mercedes-Benz press team via the usual channels, whatever is easiest for you. We hope you enjoyed the show, take care and bye for now.