BMW in talks with Merc
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EnI
Piston Pioneer
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First of all nobody (at least I didn't) say BMW has the technological initiative but business one.
Of course Daimler has a much bigger R&D budget & department - and most of its green tech solutions are coming from the Commercial vehicles devision - where the green part counts even more. And then the tech is implemented in passenger vehicles. Also a Daimler stakes in EADS gives them some sort of opportunity of know-how exchange with the engineers there - working on new fuels, energy sources, materials etc.
What does BMW have? Working & implemented tech reducing CO2 & fuel consumption ... What does MB have beside testing vehicles & numerous prototypes?
Not that BMW are not working on some important solutions ... yet they are not very audible about them until they are offered. Anybody in general public knew EfficientDynamics was really coming so was (incl the Hydrogen 7)?
I'm sure Daimler has much better R&D resourcing but BMW isn't lagging behind much.
Li-ion battery + mild-hybrid + 2-mode-hybrid was a joint-venture: BMW was there too.
Diesel-hybrid: X5 ED Vision
Electrical car? Mind E1 prototype from 1991!!!!
BlueTec: SCR tech is not Daimler's innovation!
DiesOtto engine is as ready as BMW camless EVT engine - not coming for at least next 5 years (confirmed by Daimler officals: saying tech not ready for introduction in 2013 at earliest (new S-class anyone
).etc.
Daimler are just more audible about their green R&D while BMW are already fully market theirs: EfficientDynamics in every BMW car.
Your impression is wrong. As said above BMW are not lagging behind in green tech innovation. And again: SCR tech is not Daimlers innovation; they just market the tech under BlueTec trademark.
Cooperation will bring excellent synergies: R&D people from both companies working together. On NEW TECH & SOLUTIONS, not the existing ones.
Your are saying here like BMW want to cooperate with Daimler to get their tech. Oh, c'mon.
The cooperation - as said - is relevant for new tech & solutions. Like it was in hybrid & li-ion case. Working together lowered the R&D costs by hundreds of millions of euros on both sides, and making the cars to be introduced at least 2 years earlier. Isn't that a huge benefit?
Yes, Business is not kindergarten ... but egos of some CEOs are still very vulnerable. It's a question regarding who will be in charge, and who will lead the initiative. This still matters a lot in the business world.
coolraoul
Torque Titan
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The Bluetech and urea thing is not Daimler's innovation? I thought it was, whose is it then?
I know Daimler offered to sell it under license to all other carmaker, that VAG agreed and broke the deal, and that now Daimler is thinking to sue them because their product plan contains car with this tech...
It's the same in the truck market, where Daimler is selling its Bluetech technology to all other truckmakers...
The SCR and urea thing is an old story, but Daimler must have patented some vital tweaks ans innovations to make it work properly on a car, I think. Not sure though.
Well... of course this cooperation is for the future. But the future needs to start now, and now means on Daimler's technology. So, huge gain for BMW to profit from all what Daimler developped. The Li-Ion was AFAIK not in the agreement with BMW, only the hybrid tech. I don't think the BMW full/mild hybrid will profit from Daimler's Li-Ion.
Concerning the E1... it's easy to present a concept car. The smart is actually in real-life testing for more one year, it's very different.
It's not really that BMW is less audible, they make some noise around the hydrogen for instance... it's merely that Daimler is far more advanced for the middle-term future. Whereas BMW is better now, with EfficientDynamics.
Like I said, why would Daimler's executives feel bad about a cooperation with BMW, as they are thinking and talking about that since a long time now? Only because it's about green tech, now, and before it was about something else? No, it's because it is not that easy given the respective degree of technology at the disposal of the two. it's hard to cooperate "equally" if one is noticeably more advanced than the other.
However I think they should cooperate. The hybrid cooperation seems to have worked very good, and the thing is that this green tech is not part of the "character" of the car.
You won't make the two brands loose their character if you create common env-friendly tech: either it's only something you add to your motor without jeoparizing its main characteristics, ot it's a brand new type of motor and you want it to work properly and be ready fast, fine-tweaking it to fit the image is less important than achieving a decisive innovation and bringing it to the market.
So I think they should cooperate on this. However, how can it be? Will the two be binded to have the same "green-R&D budget"? 'cause Daimler has a bigger R&D budget, and just announced it has increased it significantly.
It's not possible if this cooperation is between Daimler and BMW, but if the first gives twice as much money as the second in the R&D. Daimler would be stupid to reduce the budget to BMW's, and BMW would I think not agree to increase its to Daimler's niveau... So what? Daimler with a majority stake in the cooperation (a JV then)? It wouldn't please BMW...and would not bring a lot to Daimler, while BMW still would profit from Daimler's investments...
Any idea/info on that EnI?
I know Daimler offered to sell it under license to all other carmaker, that VAG agreed and broke the deal, and that now Daimler is thinking to sue them because their product plan contains car with this tech...
It's the same in the truck market, where Daimler is selling its Bluetech technology to all other truckmakers...
The SCR and urea thing is an old story, but Daimler must have patented some vital tweaks ans innovations to make it work properly on a car, I think. Not sure though.
Well... of course this cooperation is for the future. But the future needs to start now, and now means on Daimler's technology. So, huge gain for BMW to profit from all what Daimler developped. The Li-Ion was AFAIK not in the agreement with BMW, only the hybrid tech. I don't think the BMW full/mild hybrid will profit from Daimler's Li-Ion.
Concerning the E1... it's easy to present a concept car. The smart is actually in real-life testing for more one year, it's very different.
It's not really that BMW is less audible, they make some noise around the hydrogen for instance... it's merely that Daimler is far more advanced for the middle-term future. Whereas BMW is better now, with EfficientDynamics.
Like I said, why would Daimler's executives feel bad about a cooperation with BMW, as they are thinking and talking about that since a long time now? Only because it's about green tech, now, and before it was about something else? No, it's because it is not that easy given the respective degree of technology at the disposal of the two. it's hard to cooperate "equally" if one is noticeably more advanced than the other.
However I think they should cooperate. The hybrid cooperation seems to have worked very good, and the thing is that this green tech is not part of the "character" of the car.
You won't make the two brands loose their character if you create common env-friendly tech: either it's only something you add to your motor without jeoparizing its main characteristics, ot it's a brand new type of motor and you want it to work properly and be ready fast, fine-tweaking it to fit the image is less important than achieving a decisive innovation and bringing it to the market.
So I think they should cooperate on this. However, how can it be? Will the two be binded to have the same "green-R&D budget"? 'cause Daimler has a bigger R&D budget, and just announced it has increased it significantly.
It's not possible if this cooperation is between Daimler and BMW, but if the first gives twice as much money as the second in the R&D. Daimler would be stupid to reduce the budget to BMW's, and BMW would I think not agree to increase its to Daimler's niveau... So what? Daimler with a majority stake in the cooperation (a JV then)? It wouldn't please BMW...and would not bring a lot to Daimler, while BMW still would profit from Daimler's investments...
Any idea/info on that EnI?
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Does anyone have exact figures on:
1. How much Daimler spends on R&D annually?
2. How much BMW spends?
3. How much VW group spends?
4. How much Toyota spends?
1. How much Daimler spends on R&D annually?
2. How much BMW spends?
3. How much VW group spends?
4. How much Toyota spends?
coolraoul
Torque Titan
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Daimler in 2007: 8,7 billion $ (with 2,7 billion $ only for green techs).
Daimler in 2007, 5,234 billion € (n°1 in Europe).
Volkswagen in 2007: 4,240 billion € (n°5 in Europe)
BMW in 2007: 3,208 billion € (n°8 in Europe).
Next are Renault and Peugeot (2,4 and 2,1 billion € ans n° 13 and 14 in Europe). Porsche 448,50 million € and n° 50 in Europe...
Numbers from the European Commission.
I don't have the numbers for Toyota. But in fact, every year you have Daimler-Toyota-Ford and GM on the 4 first places for the R&D. They changes their places but are always the 4 first.
Daimler (now richer than ever) has announced they will increase significantly their R&D budget.
Daimler in 2007, 5,234 billion € (n°1 in Europe).
Volkswagen in 2007: 4,240 billion € (n°5 in Europe)
BMW in 2007: 3,208 billion € (n°8 in Europe).
Next are Renault and Peugeot (2,4 and 2,1 billion € ans n° 13 and 14 in Europe). Porsche 448,50 million € and n° 50 in Europe...
Numbers from the European Commission.
I don't have the numbers for Toyota. But in fact, every year you have Daimler-Toyota-Ford and GM on the 4 first places for the R&D. They changes their places but are always the 4 first.
Daimler (now richer than ever) has announced they will increase significantly their R&D budget.
EnI
Piston Pioneer
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@coolraoul
You are saying like Daimler & BMW would merge their green tech R&D.
It's not the case here.
Of course they have different agendas, budgets, organization etc. But the cooperation will be welcome in some areas - on certain projects. And that's what we are talking about. Specific projects - not entire green tech etc.
And btw, we are not talking green tech only here. But also some other projects done by some associations of which Daimler & BMW are members of. So, some common projects (eg. car-2-car communications, in-car communication protocols, etc).
There are many fields where BMW & Daimler could cooperate. But the problem is Daimler are still a bit careful about any cooperation - they just "divorced" Chrysler. It's like just ridding of an annoying partner, and just another candidate wanting your company is knocking on your door - not letting you even to breathe some "bachelor" air.
But the opportunity is there- who knows for how long, and it's time to act. Daimler is not in a position to be too picky. And that's the main issue - shareholders are convinced about a need to cooperate, the management is not. Shareholders view: cooperation will lower the costs & boost the profit + bring the long-term technological advantages over some other rivals excl. BMW. Management view: cooperation will make us less independent in our decisions + there won't be tech advantage over main rival (BMW).
BlueTec ...
SCR tech is not new. What Daimler did is having developed their own urea-injection system based on AdBlue, regestring BlueTec trademark, and offered it to BMW & VAG as a plan to promote German advanced Clean diesel tech in US. BMW was not fond of idea using Daimler's trademark & paying for a license, and even the system was not fitting fully to BMW standards - so BMW declined & developed the system on their own (BluePerformance Advanced Diesel).
VAG initially agreed on "cooperation" but in the end they changed their minds. Daimler is now suing VAG since according to Daimler VAG's system is a carbon copy of Daimler's - and as a counteract of VAG's BlueTec-license deal breaking.
Li-ion ...
Li-ion battery development was a part of mild-hybrid development cooperation between MB & BMW. Check the initial statement on that cooperation. So, BMW mild-hybrids will feature li-ion batteries as well. But they agreed MB will have the right to use & introduce it first - few months before BMW will.
Rearding "presenting concepts is easy":
MB tri-turbo diesel engine ...
DiesOtto engine ...
A fleet of hybrids coming in 2010 or later ...
etc ...
You are saying like Daimler & BMW would merge their green tech R&D.
It's not the case here.
Of course they have different agendas, budgets, organization etc. But the cooperation will be welcome in some areas - on certain projects. And that's what we are talking about. Specific projects - not entire green tech etc.
And btw, we are not talking green tech only here. But also some other projects done by some associations of which Daimler & BMW are members of. So, some common projects (eg. car-2-car communications, in-car communication protocols, etc).
There are many fields where BMW & Daimler could cooperate. But the problem is Daimler are still a bit careful about any cooperation - they just "divorced" Chrysler. It's like just ridding of an annoying partner, and just another candidate wanting your company is knocking on your door - not letting you even to breathe some "bachelor" air.
But the opportunity is there- who knows for how long, and it's time to act. Daimler is not in a position to be too picky. And that's the main issue - shareholders are convinced about a need to cooperate, the management is not. Shareholders view: cooperation will lower the costs & boost the profit + bring the long-term technological advantages over some other rivals excl. BMW. Management view: cooperation will make us less independent in our decisions + there won't be tech advantage over main rival (BMW).
BlueTec ...
SCR tech is not new. What Daimler did is having developed their own urea-injection system based on AdBlue, regestring BlueTec trademark, and offered it to BMW & VAG as a plan to promote German advanced Clean diesel tech in US. BMW was not fond of idea using Daimler's trademark & paying for a license, and even the system was not fitting fully to BMW standards - so BMW declined & developed the system on their own (BluePerformance Advanced Diesel).
VAG initially agreed on "cooperation" but in the end they changed their minds. Daimler is now suing VAG since according to Daimler VAG's system is a carbon copy of Daimler's - and as a counteract of VAG's BlueTec-license deal breaking.
Li-ion ...
Li-ion battery development was a part of mild-hybrid development cooperation between MB & BMW. Check the initial statement on that cooperation. So, BMW mild-hybrids will feature li-ion batteries as well. But they agreed MB will have the right to use & introduce it first - few months before BMW will.
Rearding "presenting concepts is easy":
MB tri-turbo diesel engine ...
DiesOtto engine ...
A fleet of hybrids coming in 2010 or later ...
etc ...
EnI
Piston Pioneer
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Important note:
these are total numbers of R&D money spent on entire R&D projects within company.
Eg. Daimler also includes Commercial Vehicles division, BMW includes motorcycle division etc. Motorsport R&D are also included ther etc.
These numbers hardly say anything how much money is spent on eg. passenger car green tech R&D.
Even more: money spent says nothing about how efficiently was all the money spent. You can spent more money than company A but having the same output / result in the end.
But still ... Daimler(Benz) has always been an R&D leader. That can't be denied.
Wunderkind
Chicane Challenger
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There seems to be some misconception regarding the scope of the possible co-operation between BMW and Daimler (Mercedes-Benz).
It is NOT about getting or sharing technologies.
The main impetus behind the discussion taking place is the FINANCIAL BENEFITS that are available to each party if they can successfully combine certain platforms and activities in the next few years. Both BMW and Mercedes-Benz are facing tremendous pressure to cut costs to stay competitive and profitable against other larger competitors such as Audi, Bentley, and Porsche (all part of the VAG group) and Lexus (the Toyota group).
One of the main reasons the BMW supervisory board chose Norbert Reithofer (an executive with a strong background in production) over the then CEO Helmut Panke (previously the CFO of BMW under Bernd Pischetsrieder) was because of the urgent need to cut costs. The BMW supervisory board believed that Norbert Reithofer's experience and expertise in production will make him the better person to drive the cost cutting initiatives.
On the other hand, Daimler's Dieter Zetsche was the most experienced and qualified executive to succeed Jurgen Schrempp and Eckhard Cordes. Dieter Zetsche was the CEO of the US Freightliner truck business in the US in the late 1980's and early 1990's. Zetsche was then recalled to be the Head of R&D of Mercedes Benz when Wolfgang Peter was forced to resign because of the delays and cost overruns of the W140 S Class and a few other personal issues. After that, Zetsche was sent to the US to manage the Chrysler side of the business. Zetsche was never a 'Schrempp man'. But Zetsche's (and Tom LaSorda's) role in resuscitating Chrysler that won him praise from the DaimlerChrysler board. Schrempp's exit and the Supervisory Board's subsequent endorsement of Zetsche over Cordes to succeed Schrempp forced Cordes to resign from the office of CEO of Mercedes Benz.
The talks between BMW and Mercedes Benz now are:
1) Sharing a common platform for the 1 series and the sub-1 series minicar with next the Smart & A/B Classes.
2) Sharing the transversely mounted 4 cylinder engines for the above models.
3)Any and all future technologies and activities.
Number 1 & 2 are the most important in the near term because they allow both marques to make money in the market segment where each one is either losing money or barely breaking even at the moment.
Number 3 encompasses all future technologies and activities and not limited to any one technology or item. BMW and Mercedes may even entertain the idea of sharing production facilities outside of Germany. After all, why can't a BMW 1 Series and a Mercedes A Class be built on the same production line if they share common platform and drivelines?
It is NOT about getting or sharing technologies.
The main impetus behind the discussion taking place is the FINANCIAL BENEFITS that are available to each party if they can successfully combine certain platforms and activities in the next few years. Both BMW and Mercedes-Benz are facing tremendous pressure to cut costs to stay competitive and profitable against other larger competitors such as Audi, Bentley, and Porsche (all part of the VAG group) and Lexus (the Toyota group).
One of the main reasons the BMW supervisory board chose Norbert Reithofer (an executive with a strong background in production) over the then CEO Helmut Panke (previously the CFO of BMW under Bernd Pischetsrieder) was because of the urgent need to cut costs. The BMW supervisory board believed that Norbert Reithofer's experience and expertise in production will make him the better person to drive the cost cutting initiatives.
On the other hand, Daimler's Dieter Zetsche was the most experienced and qualified executive to succeed Jurgen Schrempp and Eckhard Cordes. Dieter Zetsche was the CEO of the US Freightliner truck business in the US in the late 1980's and early 1990's. Zetsche was then recalled to be the Head of R&D of Mercedes Benz when Wolfgang Peter was forced to resign because of the delays and cost overruns of the W140 S Class and a few other personal issues. After that, Zetsche was sent to the US to manage the Chrysler side of the business. Zetsche was never a 'Schrempp man'. But Zetsche's (and Tom LaSorda's) role in resuscitating Chrysler that won him praise from the DaimlerChrysler board. Schrempp's exit and the Supervisory Board's subsequent endorsement of Zetsche over Cordes to succeed Schrempp forced Cordes to resign from the office of CEO of Mercedes Benz.
The talks between BMW and Mercedes Benz now are:
1) Sharing a common platform for the 1 series and the sub-1 series minicar with next the Smart & A/B Classes.
2) Sharing the transversely mounted 4 cylinder engines for the above models.
3)Any and all future technologies and activities.
Number 1 & 2 are the most important in the near term because they allow both marques to make money in the market segment where each one is either losing money or barely breaking even at the moment.
Number 3 encompasses all future technologies and activities and not limited to any one technology or item. BMW and Mercedes may even entertain the idea of sharing production facilities outside of Germany. After all, why can't a BMW 1 Series and a Mercedes A Class be built on the same production line if they share common platform and drivelines?
justanthony
Highway Hunter
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Very good post. Factual and simple enough, though you wouldn't be able to tell from the the way the thread has been converted to another 'MY company has a bigger d..k than YOURS' thread..
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