Mercedes-Benz AG outlined plans for producing its next generation of electric vehicles, moving past a critical crossroads with German labor unions as the carmaker phases out some models in its shift to all-luxury.
The production plan will see its Sindelfingen, Stuttgart, factory produce vehicles based on the electric architecture being developed for its high-performance AMG division, the company said Wednesday. That factory already produces the EQS, the electric version of its flagship S-Class model.
Plants in Bremen and Kecskemet, Hungary, will produce vehicles based on the company’s mid-range luxury electric platform: all-electric versions of the C-Class, E-Class and similar models. Bremen already produces the all-electric EQE.
The firm’s Rastatt plant will produce vehicles for the firm’s so-called Entry Luxury segment, to be based on a modular electric vehicle platform called MMA, which is also used at the Kecskemet facility.
“We are ready for the rapid scaling of electric vehicle volumes,” Joerg Burzer, Mercedes board member responsible for production said in a statement. “With the new production set up we are further increasing our flexibility and efficiency and securing the future of our locations.”
Mercedes’s plans come as European Union countries endorsed a push to eliminate carbon emissions from new cars by 2035, effectively spelling the end of the internal combustion engine.
Read more: EU Takes Historic Step to Phase Out Combustion Engines by 2035
All Mercedes factories are set to produce electric vehicles into the early 2030s. The announcement follows an agreement with the company’s powerful labor unions on securing jobs and investment as the company intensifies its shift from combustion engine to all-electric models.
“As employee representatives we demanded German production sites continue to play a significant role,” Mercedes works council chief Ergun Luemali said in a statement. “The introduction of new technologies to our production sites is the key to becoming future proof and to ensuring continued employment.”
Mercedes management is intensifying efforts to transform one of the most storied names in automaking into an all-electric rival to Tesla Inc. The company aims to have battery-powered models in all its segments this year, a staging post for its ambition to only sell electric cars by 2030.