EV assembly is not a radical change, Mercedes production exec says

VANCE, Alabama — Industry analysts warn that shifting from fossil fuel to battery power threatens thousands of vehicle assembly plant jobs.

The logic is that electric vehicles with fewer parts will require less time and and a smaller work force to put together.

But in the early days of this transformation, that is not the case at Mercedes-Benz's U.S. factory in Vance, Alabama. The plant builds most of the global output of the EQS and EQE all-electric models.

"We heard so many discussions in the past where folks were scared this move into the electric future [would] cost thousands" of jobs, said Michael Göbel, CEO of Mercedes-Benz U.S. International, which operates the 6,300-employee factory.

"At least in the final assembly, we don't see that right now," Göbel told Automotive News on the sidelines of a media event here Monday. "There is really not a big difference in build time."

He said building an EV is not a "radical change" from assembling a combustion engine vehicle.

"The basics about screwing, or clipping, or gluing are the same processes," he said.

The most significant change is producing the key component that powers the electric vehicle — the battery pack.

"We are talking about tolerances and accuracies we are usually not used to in car manufacturing," Göbel said.

The powertrain technology presents a steep learning curve for production workers at the Mercedes factory.

"Everyone needed to get trained on safety because now you have a high voltage system in the car," Göbel said. "We spend hours on training to make sure team members understand which areas [of the vehicle are] dangerous."

Last year, Mercedes opened a facility where workers assemble battery modules into flat packs along the floor of the EQ crossovers.

With the prices of battery materials such as lithium and cobalt soaring, automakers are turning to their factory bosses to squeeze cost savings from the assembly line to help EVs reach price parity with their combustion engine counterparts.

"We need to get more efficient in the manufacturing world; we need to find efficiencies with our suppliers," Göbel said. "I'm convinced you will find cheaper, quicker ways to assemble an electric car maybe in five or 10 years."

Much is riding on Göbel's shoulders as Mercedes pivots into an all-electric brand in markets ready for the switch. The luxury marque expects EVs to account for about half its U.S. sales by 2030. This year, Mercedes aims to sell up to 45,000 EQ-branded electric vehicles in the U.S., executives told dealers last year.

To meet its ambitious EV sales targets, Mercedes invested about $1 billion in recent years at the Alabama factory. The Vance factory is one of seven EV production sites on three continents and could produce more than 100,000 EVs this year, a third of its annual capacity of 305,000.

Unsure of demand for the new technology, Mercedes began building EQ vehicles alongside its combustion engine variants in a new wing of the expanded production campus.

"In the early transformation from combustion to EV, we were not sure what the market [was] doing, and we wanted to keep it flexible," Göbel said.

But it took about three months for Mercedes execs to realize they underestimated early demand, Göbel said.

"We are coming into volume ranges where we need the whole facility for just building EVs," Göbel said.