Mercedes Plots Tesla Attack With $1 Billion U.S. Electric Push In Alabama

By Christoph Rauwald and Elisabeth Behrmann
Bloomberg

Daimler AG plans to spend $1 billion to start production of Mercedes-Benz electric vehicles at its Alabama factory, setting the world’s largest luxury carmaker up to battle with battery-car specialist Tesla Inc. on its home turf.

The German automaker will build its fifth battery plant globally and create more than 600 jobs in the region, the company announced Thursday. The Alabama factory will assemble electric sport utility vehicles, taking on Tesla’s Model X and making Stuttgart-based Daimler the first European company to assemble plug-in autos in the U.S.

“We’re celebrating our 20th anniversary at our production facility in Tuscaloosa, Alabama, and we’re taking this as an opportunity to expand the operation and further fuel growth,” production chief Markus Schaefer said. “We’re very confident for future growth in the U.S. in the long term.”While the investment could ease tensions over President Donald Trump’s claims that too many German cars are being sold to Americans, the real target is the intensifying rivalry with Tesla. The Palo Alto, California-based carmaker’s flagship Model S sedan outsold the Mercedes S-Class and BMW 7-Series last year in the U.S., putting pressure on the foreign brands to defend their image as automotive innovators.

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