German luxury powerhouse Mercedes-Benz has broken ground on an upcoming 500 million euro ($747 million) manufacturing facility that will produce the lithium-ion battery packs for its upcoming range of electric vehicles (EVs) branded under the EQ banner, along with numerous other future models.

Located in Kamenz, Germany, the new factory is claimed to be Europe's premiere EV battery factory when it goes live in mid-2018, set to take on Tesla's Gigafactory - which has been developed in cooperation with Japanese electronics company Panasonic.

The 20-hectare facility is just one part of parent company Daimler's 1 billion euro ($1.5 billion) investment into energy storage subsidiary, Accumotive, and will form the basis of Mercedes-Benz's upcoming EQ electric car sub-brand - which will kick off with the production version of the Generation EQ SUV concept in 2019.

Generation EQ

Above, Top, Below: Mercedes-Benz Generation EQ concept

Speaking with the UK's Autocar, Dieter Zetsche, chairman for Mercedes-Benz, said: "The automotive industry is facing a fundamental transformation".

"The battery factory in Kamenz is an important component in the implementation of our electric offensive. By 2022, we will have more than ten purely-electric passenger cars."

"We also continue to drive forward the hybridisation of our fleet. Under the EQ brand, we are creating a holistic ecosystem for e-mobility," he added.

Generation EQ

Accumotive also plans to produce batteries for Mercedes-Benz vehicles equipped with 48V battery modules, the first being selected versions of the facelifted 2018 S-Class range - which arrives in Australia by the end of the year.

Last year, Mercedes-Benz filed trademark applications for the names EQA, EQC, EQE and EQS - indicating the new EV models will be structured around the existing A, C, E and S model lines.

The production version of the Generation EQ SUV concept is expected to be named the EQC. Fuelling these claims were recent spy shots of a prototype wearing sheetmetal borrowed from the current GLC crossover (below).


In terms of Australia, Mercedes-Benz has projected the production Generation EQ will be available locally around 2020.

Stay tuned to CarAdvice for more Mercedes-Benz EQ updates.