BMW took the wraps of the Vision Neue Klasse electric vehicle at the IAA motor show in Munich, Germany. It underpins BMW’s big push into electric vehicles.
BMW
MUNICH, Germany — BMW and Mercedes are making their biggest push yet into electric cars in a bid to fend off rising competition from Chinese players and catch up with U.S. giant Tesla.
In the last few days, as part of the IAA Mobility motor show in Munich, Germany, the auto giants took the wraps off electric concept cars and new platforms for their future battery-powered vehicles.
European carmakers, which have been perceived to be behind Chinese companies like Warren Buffett-backed BYD and Elon Musk’s Tesla, have had to move quickly to show the market they’re ready to be major players in the electric era.
On Sunday, Mercedes-Benz unveiled its Concept CLA Class, an electric vehicle built on a new architecture that will underpin future battery cars from the German auto giant. The company said the concept car has a range of 750 kilometers (466 miles) as well as an ability to reach a range of 400 kilometers with just 15 minutes of charging.
Mercedes CEO Ola Kallenius talked up the car, calling it a “revolutionary development” for the German firm.
“With those efficiency numbers, that kind of range, that kind of fast charging, I am not aware of any vehicle, in that class that can match that,” Kallenius told CNBC’s Annette Weisbach on Sunday.
On Saturday, rival BMW showed off the “Vision Neue Klasse,” another electric concept car that highlights the company’s EV ambitions. Neue Klasse is BMW’s new architecture for its EVs. The first vehicles based on this platform are set to enter production in 2025.
“In only two years’ time, these cars will hit the road and with that, overall, we lead BMW to a new era of innovation and sustainability. That’s the purpose of our show here at the IAA,” BMW CEO Oliver Zipse told CNBC’s Arabile Gumede.
Zipse said BMW is going to double its EV sales this year. By the end of 2023, 15% of BMW’s global sales will be battery EVs, he added.
Mercedes and BMW’s dedicated EV platforms are a departure from previous architecture where they would adapt combustion engine or hybrid models and add batteries. This is the companies’ biggest push yet toward a new platform for the electric vehicle era.
Analysts said that Mercedes and BMW’s announcements are big steps but might leave them still lagging behind Tesla.
“The new platforms at Mercedes and BMW showcase, for the first time, what the European OEMs [original equipment manufacturers] will be capable of. These cars are likely still a year away, but their specifications show that European OEMs will be able to create compelling products,” Daniel Roeska, senior research analyst at Bernstein Research, told CNBC via email.
Roeska said that these new platforms “will close a large portion of the gap” to Tesla and the Chinese players, “but not all the way.”
Price war in focus
BMW and Mercedes are wading further into an increasingly competitive electric vehicle market, broadly dominated by Tesla and various Chinese players.
Tesla commanded 20% of the global EV market in the second quarter, followed by 15% for BYD, according to Counterpoint Research.
And the competition has become more fierce thanks to a price war largely sparked by Tesla. The U.S. automaker began cutting prices in 2023, vowing to sacrifice margins in the short term for market share gain.
Mercedes and BMW both play in the premium segment of the market, where cars like Tesla’s Model S and Model X compete. As they prepare to release more EVs in the coming years, Mercedes maintains its focus is not on pushing large volumes.
“We are not pushing volume, we are focusing on value over volume,” Kallenius said.
Meanwhile, Volkswagen’s strategy appears to be to release cars at various prices to capture different segments of the market.
The company announced Sunday that it will launch eleven new all-electric models by 2027, underscoring its EV push. In 2026, Volkswagen said it plans to launch the ID. 2all, an electric vehicle that will sell for less than 25,000 euros ($26,942).
The German auto giant showed off the ID. GTI Concept electric vehicle at the IAA show, and said a production version of the car is scheduled to hit the road in 2027.
Tesla, China dominate with tech in focus
In a world where batteries are powering cars, it’s not just design of the car or the engine that is going to win over consumers. Technology is increasingly important.
“Premium EVs now need to resemble smartphones more than traditional cars to offer a similar experience to Tesla – the gold standard in EVs with its vertically integrated platform,” Counterpoint said in a note last week.
Indeed, Tesla has built its business on controlling the hardware – the car itself – as well as the software that goes inside it. Musk often talks up the company’s Autopilot features which allow the car to carry out some driving features autonomously. Tesla’s large internal screen and apps make it feel more akin to using a smartphone.
Paxton sued Google in 2022 for allegedly unlawfully tracking and collecting the private data of users.
The attorney general said the settlement, which covers allegations in two separate lawsuits against the search engine and app giant, dwarfed all past settlements by other states with Google for similar data privacy violations.
Google’s settlement comes nearly 10 months after Paxton obtained a $1.4 billion settlement for Texas from Meta, the parent company of Facebook and Instagram, to resolve claims of unauthorized use of biometric data by users of those popular social media platforms.
“In Texas, Big Tech is not above the law,” Paxton said in a statement on Friday.
“For years, Google secretly tracked people’s movements, private searches, and even their voiceprints and facial geometry through their products and services. I fought back and won,” said Paxton.
“This $1.375 billion settlement is a major win for Texans’ privacy and tells companies that they will pay for abusing our trust.”
Google spokesman Jose Castaneda said the company did not admit any wrongdoing or liability in the settlement, which involves allegations related to the Chrome browser’s incognito setting, disclosures related to location history on the Google Maps app, and biometric claims related to Google Photo.
Castaneda said Google does not have to make any changes to products in connection with the settlement and that all of the policy changes that the company made in connection with the allegations were previously announced or implemented.
“This settles a raft of old claims, many of which have already been resolved elsewhere, concerning product policies we have long since changed,” Castaneda said.
“We are pleased to put them behind us, and we will continue to build robust privacy controls into our services.”
Virtual care company Omada Health filed for an IPO on Friday, the latest digital health company that’s signaled its intent to hit the public markets despite a turbulent economy.
Founded in 2012, Omada offers virtual care programs to support patients with chronic conditions like prediabetes, diabetes and hypertension. The company describes its approach as a “between-visit care model” that is complementary to the broader health-care ecosystem, according to its prospectus.
Revenue increased 57% in the first quarter to $55 million, up from $35.1 million during the same period last year, the filing said. The San Francisco-based company generated $169.8 million in revenue during 2024, up 38% from $122.8 million the previous year.
Omada’s net loss narrowed to $9.4 million during its first quarter from $19 million during the same period last year. It reported a net loss of $47.1 million in 2024, compared to a $67.5 million net loss during 2023.
The IPO market has been largely dormant across the tech sector for the past three years, and within digital health, it’s been almost completely dead. After President Donald Trump announced a sweeping tariff policy that plunged U.S. markets into turmoil last month, taking a company public is an even riskier endeavor. Online lender Klarna delayed its long-anticipated IPO, as did ticket marketplace StubHub.
But Omada Health isn’t the first digital health company to file for its public market debut this year. Virtual physical therapy startup Hinge Health filed its prospectus in March, and provided an update with its first-quarter earnings on Monday, a signal to investors that it’s looking to forge ahead.
Omada contracts with employers, and the company said it works with more than 2,000 customers and supports 679,000 members as of March 31. More than 156 million Americans suffer from at least one chronic condition, so there is a significant market opportunity, according to the company’s filing.
In 2022, Omada announced a $192 million funding round that pushed its valuation above $1 billion. U.S. Venture Partners, Andreessen Horowitz and Fidelity’s FMR LLC are the largest outside shareholders in the company, each owning between 9% and 10% of the stock.
“To our prospective shareholders, thank you for learning more about Omada. I invite you join our journey,” Omada co-founder and CEO Sean Duffy said in the filing. “In front of us is a unique chance to build a promising and successful business while truly changing lives.”
Liz Reid, vice president, search, Google speaks during an event in New Delhi on December 19, 2022.
Sajjad Hussain | AFP | Getty Images
Testimony in Google‘s antitrust search remedies trial that wrapped hearings Friday shows how the company is calculating possible changes proposed by the Department of Justice.
Google head of search Liz Reid testified in court Tuesday that the company would need to divert between 1,000 and 2,000 employees, roughly 20% of Google’s search organization, to carry out some of the proposed remedies, a source with knowledge of the proceedings confirmed.
The testimony comes during the final days of the remedies trial, which will determine what penalties should be taken against Google after a judge last year ruled the company has held an illegal monopoly in its core market of internet search.
The DOJ, which filed the original antitrust suit and proposed remedies, asked the judge to force Google to share its data used for generating search results, such as click data. It also asked for the company to remove the use of “compelled syndication,” which refers to the practice of making certain deals with companies to ensure its search engine remains the default choice in browsers and smartphones.
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The DOJ also proposed the company divest its Chrome browser but that was not included in Reid’s initial calculation, the source confirmed.
Reid on Tuesday said Google’s proprietary “Knowledge Graph” database, which it uses to surface search results, contains more than 500 billion facts, according to the source, and that Google has invested more than $20 billion in engineering costs and content acquisition over more than a decade.
“People ask Google questions they wouldn’t ask anyone else,” she said, according to the source.
Reid echoed Google’s argument that sharing its data would create privacy risks, the source confirmed.
Closing arguments for the search remedies trial will take place May 29th and 30th, followed by the judge’s decision expected in August.
The company faces a separate remedies trial for its advertising tech business, which is scheduled to begin Sept. 22.