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Harald Krüger (L), CEO of BMW AG, and Dieter Zetsche, CEO of Daimler AG, speak to the media about a new joint effort between the two automakers in carsharing on February 22, 2019 in Berlin, Germany.
Traditionally fierce rivals, BMW and Daimler are teaming up to challenge a new wave of high-tech competitors, such as Uber and Alphabet’s Waymo unit, by launching five mobility services joint ventures.
The two German-based luxury automakers first announced plans to team up last spring and are now ready to set in motion projects including ride- and car-sharing, as well as electric vehicle charging. The project, which is expected to see them invest a combined 1 billion euros, or $1.13 billion, will also create an initial 1,000 new jobs, BMW and Daimler announced at news conference Friday morning in Frankfurt.
The project reflects the dramatic shift expected to transform the auto industry over the coming decade and, in the process, it threatens to sharply reduce new vehicle sales. The Boston Consulting Group, for example, has estimated that nearly a third of the miles that Americans will clock on the road by 2030 will be in electrified, autonomous vehicles operated by ride-sharing services.
Virtually every major automaker has now launched some form of mobility services program, whether independently or in partnership. But the challenges are significant, as Ford Motor learned before the recent announcement that it was killing off its own ride-sharing service, Chariot.
As part of the new joint venture, Daimler will merge its Car2Go car-sharing service with an assortment of mobility services operations at BMW. Going forward, the new program will focus on five areas:
- Free Now, an Uber-style ride-sharing service;
- Share Now, which will replace and expand Car2Go’s car-sharing operations;
- Charge Now, an electric vehicle charging network;
- Park Now, a service that will help motorists not just find available parking but even book a space ahead of time; and
- Reach Now, a smartphone-based route management and transportation service.
“These five services will merge ever more closely to form a single mobility service portfolio with an all-electric, self-driving fleet of vehicles that charge and park autonomously,” said BMW Chief Executive Harald Krueger.
Exactly how the new world of mobility services will shake out is far from certain, but both BMW and Daimler have expressed a desire to get out into the forefront. Not all of their efforts will be included in the new venture. They will, for example, maintain separate programs for the development of both battery-electric and self-driving vehicles – though even there, they have found ways to work together, both German companies investing in the purchase of Nokia’s former high-resolution mapping service, a technology considered essential for autonomous vehicles.