Ola Källenius is open to expanding the arms business. But this must make “economic sense,” Källenius told the Wall Street Journal, according to the paper.
“The world has become more unpredictable and I think it is absolutely clear that Europe needs to strengthen its defense profile,” he said. “If we can play a positive role in this, we would be willing to do so.”
According to Källenius, Mercedes’ strengths as a large-scale manufacturer could help the company to become more directly active in the field of military equipment. “What car manufacturers do extremely well – and we’re good at it – is producing high-quality precision machines in large quantities,” he told the Wall Street Journal.
According to the paper, Källenius predicted that the defense business would only make up a small proportion of the business compared to the production of cars and vans. However, “it could be a growing niche that could also contribute to our business results,” he said. “So we’ll see.”
Mercedes-Benz speaks of a strategic development area
When asked, Mercedes-Benz pointed out that the company basically develops and produces civilian vehicles. Activities in the security and defense sector are a strategic development area that is being actively developed and in cooperation with partners.
“With modifiable vehicles for security and defense operations, we have been strengthening the defense and security policy of Europe and NATO for decades – and at the same time securing future viability and jobs at our locations,” it said. For many years, chassis have also been supplied to specialized companies “who develop and market them for military applications under their own responsibility and under their own brand.”
Car manufacturers and suppliers are considering entry
The German auto industry is showing growing interest in the defense sector in view of increasing military spending. Both car manufacturers and suppliers are considering entering the market or are already planning one. The weak sales of the German car industry and the change to electromobility are affecting many companies, while the Defense industry experienced strong growth and expansion due to international conflicts.
According to experts, there are opportunities for the ailing automotive supply industry in the defense industry, for example in the production of body parts, drive components as well as vehicle and assistance systems. So it’s an industry-wide trend where automakers and suppliers are looking at the defense industry as a possible diversification strategy.
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