China remains bright spot amid pandemic, says Daimler chairman

Daimler is gradually recovering from the coronavirus pandemic, especially in China, which gives the German carmaker "cautious optimism" about its prospects, said Chairman Ola Kaellenius.

"Step by step, we are getting back on track," said Kaellenius, who is also chairman of Daimler's Mercedes-Benz, in an online interview on May 25.

"Most of our showrooms around the world have now reopened and customers are returning, especially in China. It is one of those bright spots in this case."

The recovery is noticeable in China, which is the world's largest car market and one of the drivers of Mercedes-Benz's success. Sales of the premium marque have returned to a normal level since late March and a rise was spotted in April.

"So I have cautious optimism," said Kaellenius.

Last year, Mercedes-Benz's deliveries in China grew 6.2 percent year-on-year to 693,443 units, outperforming BMW and Audi to become the most popular premium vehicle brand in the country.

The company said in January that it planned to launch 18 new models in the country during 2020.

Globally, Daimler's production is restarting after plant closures in previous months.

Production at the powertrain and passenger car plants globally has been ramped up since April 20. From June, all its passenger car plants worldwide will be restarting, said the company.

Kaellenius said it is too early to make final conclusions on the pandemic, but one thing he learned from the current situation is that individual mobility remains a valuable asset.

"The car is a protected space. It provides independence and freedom," he said.

Kaellenius said as the industry evolves, Daimler will continue to push forward electrification, as part of its goal to have a carbon-neutral new car fleet from 2039.

"Fully electric Mercedes-Benz trucks, vans and buses are already in production today. By the end of this year, the goal is to have five fully electric passenger car models and 20 plug-in hybrid variants on the market," he said.

The plug-in hybrids range from models in the A to the S-Class, and from the GLA to the GLE, featuring pure electric ranges of up to 100 kilometers.

In China, Mercedes-Benz launched its electric EQC late last year. The SUV and its batteries are built with its Chinese partner, BAIC Group.

Kaellenius said the company will be producing an electric S-Class sedan, called the EQS, in Germany in 2021.

Daimler is in the process of electrifying its smart-brand vehicles. Earlier this year, it set a 50-50 joint venture in Ningbo, Zhejiang province, with Geely Holding Group to develop and produce electric versions of the mini-sized vehicles.

Mercedes-Benz will be responsible for the styling of the vehicles and Geely, which is also Daimler's largest shareholder, will undertake the engineering and development work.

The 5.4 billion yuan ($778 million) joint venture is tasked with growing the brand, established in 1998, into a leader of premium electrified vehicles. From 2022, China will be the sole producer of vehicles under the brand.

Geely and Daimler also plan to expand its lineup. It will also set up sales centers in China and Germany. The vehicles will be built in China but the location of the plant has not been released.