Mercedes

Ola Källenius, CEO of the Mercedes-Benz group, did not rule out the idea of entering the arms sector in an interview with the Wall Street Journal published from Friday night to Saturday, amid tariffs and fierce Chinese competition, automakers have been struggling recently.

The head of the German automotive manufacturer Mercedes-Benz did not rule out entering the arms sector in an interview with the American newspaper Wall Street Journal published from Friday night to Saturday.

“The world has become more unpredictable, and I think it is very clear that Europe needs to strengthen its defense profile,” said the CEO of Mercedes-Benz, the German-Swede, Ola Källenius. “If we can play a positive role in this area, we would be ready to do so,” he added.

Russian threat as a trigger?

These statements come in the context of Germany’s rearmament in the face of the growing Russian threat since the invasion of Ukraine in February 2022.

The German defense industry is benefiting greatly from this trend, as illustrated by the rise of Rheinmetall in recent years. On the other hand, German car manufacturers like Mercedes-Benz or Volkswagen are facing a major crisis, caught between tariffs and fierce Chinese competition.

At the end of March, the CEO of another German automotive giant, Volkswagen, Oliver Blume, said to be “in contact” with arms companies, particularly active in missile defense, to convert one of its German factories into the production of military transport equipment. According to the Financial Times, discussions are ongoing with the company Rafael Advanced Defense Systems, which designed the Israeli Iron Dome.

“A strategic development axis”

Asked by AFP about Ola Källenius’ interview, a Mercedes-Benz spokesperson pointed out that the group “has been supplying chassis to specialized companies for many years that equip and market them under their own responsibility and brand for military applications.”

“Our activities in the security and defense sector constitute a strategic development axis that we will continue to actively develop, in collaboration with our partners,” she added. Mr. Källernius did not provide specific details in his interview with the Wall Street Journal about the types of products Mercedes-Benz could manufacture.

He predicted that this type of defense-related activity would only represent a “minor part of Mercedes-Benz’s business” compared to the production of cars and vans, but they could be “a growing niche that could also contribute to the group’s commercial results.”