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“We see tech companies as our benchmark, especially the culture of how they operate,” says Dr. Dieter Zetsche, global head of Mercedes-Benz. “Our objective is always to become number one because we have the most intriguing product.”

The next decade will, by necessity, be a period of rapid change for motoring companies, and the boss of Mercedes-Benz won’t be looking at traditional competitors for inspiration. Rather, he says the company will be looking at much more varied targets than ever before.

“I would say our unique advantage over tech companies like Apple, Google (both rumoured to be planning vehicles of their own) or Tesla, is our overall refinement that comes from years of building cars,” Dr. Zetsche said.

“At the end of the day, development of the car is about making the best compromises. That’s not a nice word, and we don’t like using it, but that is the reality. You have to deliver on many targets, which are to some extents a conflict.”

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Above: In a relatively short period of time Tesla has established itself as one of the technological leaders in the automotive industry

The most poignant example of such a conflict is, according to the boss of Mercedes-Benz, best illustrated by the clash of power versus efficiency. There’s also exterior design, which must be attractive but also crucially deliver on aerodynamic efficiency.

“We must start to think like tech companies, but these areas are something where I think experience helps,” Dr. Zetsche says. “This won’t preclude you from making an evolutionary step though.”

Mercedes-Benz has now implemented, company-wide, a scale that ranks people in five levels of digital competency.

“That ranges from being able to handle a smart phone to having the absolute best technological understanding,” Dr. Zetsche says. “We have a timeline for what percentage of our people fit into these categories and how we get them to the top of that scale.”

Dr. Zetsche said that there are now many new and different aspects of a vehicle that change the technological development of the vehicle. “Things are going a little faster than most of us thought until recently,” he said.

“That is why we must be faster. The digital connection of the car is different, and the idea of owning versus sharing is also different. I see all these significant changes as tremendous opportunities to improve the offering to our customers.”

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Rather than watching on, Mercedes-Benz wants to be part of shaping this new technology.

“You have to get people to think differently in the company, but much of that is already underway,” Dr. Zetsche says.

“At the same time, though, the next S-Class needs to be another example of the current best car in the world, so some aspects are the same as they have always been.”

Key to the appeal of established brands like Mercedes-Benz is tradition and brand loyalty, Dr. Zetsche says.

“I do believe we are very good in terms of design. I also believe though that our brand is a tremendous asset, something that is always difficult to challenge with a new brand, one that is new to the market.”

Mercedes-Benz welcomes the new players though, chief among them Tesla and Google. “They are good for us,” Dr. Zetsche says.

“The three german premium brands together command such a big chunk of the premium luxury market currently, but we need to work hard to maintain that.”

MORE: Mercedes-Benz boss says Elon Musk is a ‘Mastermind’
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