LONDON — The chief govt of Germany’s Daimler believes the automaker will face stiff opposition from tech giants like Google, Apple and Alibaba in the event that they determine to launch their very own electrical automobiles.

Whereas the tech giants are but to begin promoting their very own automobiles, experiences counsel they may quickly launch merchandise that mix {hardware} and software program as the electrical car race heats up.

“There will probably be intense competitors,” Daimler CEO Ola Kallenius advised CNBC’s Annette Weisbach on Thursday when requested if he was involved about digital firms coming into the electrical automobiles market.

“When an business goes by way of transformation, I believe it is pure that new gamers take a look at the business,” he stated.

Kallenius stated Daimler will “take a look at what the model stands for and take that into the subsequent technological period,” including that the corporate will be capable of construct on its place if it does that properly.

His feedback come as Mercedes Benz, which is owned by Daimler, launches an electrical model of its flagship S-Class luxurious sedan.

“It is form of the beginning of a brand new period,” Kallenius stated, earlier than including that there is a variety of “curiosity” surrounding the brand new car.

Pricing for the luxurious sedan will probably be introduced in the summertime however Kallenius stated Daimler expects to make cash on the car from the second it goes on sale.

He added that the variable prices are increased on automobiles with a big electrical battery than they’re on automobiles with a conventional inside combustion engine.

“Our activity throughout this decade of transformation is on the one hand to drive the variable prices down and restore in all our segments a margin parity,” Kallenius stated.

Electrical car expertise is “nonetheless in its infancy” and there is a “lot of labor to do,” he continued. “Will probably be scaled and we may have technological developments. I am optimistic that we can restore the margins that now we have been used to.”

Shares of Daimler have skyrocketed during the last 12 months, up greater than 173% year-on-year to commerce at 75 euros ($89) per share on Thursday.

“We now have optimistic momentum in our inventory,” Kallenius stated, including that it is right down to improved monetary efficiency and the corporate’s “expertise technique for the longer term.”

Nevertheless, Daimler’s market cap has crashed to simply 80 billion euros right now from round 185 billion euros in 1998. In the meantime, Tesla’s market cap has soared to $694 billion.

“If we take a look at the overall market caps of each single auto participant on the earth proper now, you find yourself with a powerful quantity,” Kallenius stated.

He added: “We have to ensure that the distribution of that complete market cap strikes extra in our favor. That is what we’re engaged on.”

Like different automotive producers, Daimler’s enterprise has been negatively affected by the worldwide chip scarcity.

“We will promote greater than we will produce at this second,” Kallenius