Good morning, ladies and gentlemen. This is Steffen Hoffmann speaking. On behalf of Daimler and Mercedes-Benz, I'd like to welcome you on both the telephone and the internet to our update, where we want to inform you about Mercedes-Benz move to join ACC. Thanks that you could make it to join us in this call, even as we invited somehow on short notice. We will now have roughly 30 minutes for this session on our ACC engagement, and we are very happy to have with us Ola Källenius, Markus Schäfer, and Harald Wilhelm. In order to give you maximum time for your questions, Ola will begin with an introduction, directly followed by a Q&A session. Now I'd like to hand over to Ola. Yeah. Thank you, Steffen, and good morning, everybody. At the end of July, we presented our comprehensive plan to transform Mercedes-Benz into, ultimately, an electric vehicle company. Today, we announce the next milestone in this endeavor. We're taking an equity stake of 33% in battery cell manufacturer ACC. Stellantis and TotalEnergies announce we will become equal shareholders. Together with ACC, we're going to develop and build next-generation battery cells and modules, tailor-made to the specific requirements of Mercedes-Benz. This partnership allows us to secure supply, take advantage of economies of scale, and also, of course, provide our customers with superior battery technology. Moreover, we will help to ensure Europe remains at the heart of the auto industry, even in an electric era. With us as a shareholder, ACC aims to more than double capacity at its European sites, and our objective is at least 120 GW-hour of cell capacity by the end of this decade. We will step in and engage at around the mid of this decade with regard to our vehicles. The entire project will require an investment of more than EUR 7 billion, which is a combination of equity, debt, and subsidies. We will invest a mid three-digit million euro amount next year. In total, our investments are expected to remain below EUR 1 billion. These are also included in the financial framework that we presented on July 22. This new partnership gives us access to top-notch battery cells at highly competitive costs. At the same time, it will support our ambitious EV ramp-up plans. By the end of the decade, as we have said, Mercedes-Benz will be ready to go fully electric where market conditions allow. I think creating this new battery champion is further proof we're not going to wait for a transformation to happen. We will help make it happen. Looking forward to your questions. Thank you very much, Ola. Ladies and gentlemen, you may ask your questions now. The operator will identify the questioner by name. Please also introduce yourself with name and the name of the organization that you're representing before asking your question. As always, please ask your question in English, and please limit the amount of question to a maximum of two. Before we start, the operator will again explain the procedure. Ladies and gentlemen, if you want to ask a question, please press zero and one on your telephone keypad. To remove the question, please press zero and two on your telephone keypad. Again, for a question, please press zero and one on your telephone keypad, and zero and two to withdraw. If you are using speaker equipment today, please lift the handset before making your selection. The first question goes to Tim Rokossa. Good morning, gentlemen. It's Tim from Deutsche Bank. I have a couple of questions just to really understand the context of this investment itself. You say that the project will require about EUR 7 billion of investment, but your injection is only EUR 1 billion. Can you put a little bit more flesh to those numbers? Is the rest your partners, is the rest subsidies? Also, considering you probably need more cells in Europe, will this remain your only investment over here and the rest is covered through regular purchasing, or is there more to come? Secondly, if we move outside of Europe and China, you obviously have CATL and Farasis. Should we plan anything for the U.S., when? Thank you. Maybe I get started with the first question. Tim, hello. Good morning. Well, that investment of about EUR 7 billion over time refers to the ACC scope. That's the entire investment as we see it with our new partners. In terms of the funding of that EUR 7 billion, Ola alluded to it. It will be a mix of share of debt, equity, and European Union support, or call it subsidies. The detailed share of that, I think, will be hammered out over time and will obviously develop. With regard to our own engagement, Ola mentioned it will be below EUR 1 billion over time. There will be more a bullet payment pretty shortly after closing, which we expect to be rather in the early days of 2022. That should be in the order of magnitude of euro three digit million. Over time, incremental equity might be injected in the proportion of debt equity and subsidies as I alluded to before. Please note, that investment of below EUR 1 billion refers to the ACC scope. Any other investment As part of contractual arrangements, as we have it with our current main partners and as we might do it in the context of the ramp-up plan with arrangements yet to come, that is separate. Tim, as you mentioned, we already have strong partnerships. You mentioned two. Those are not the only two that we have. It's not like we're starting from scratch now. Some of that capacity has already been installed and pretty much the path towards 2025 has been secured. For the U.S., we are in discussions with different partners of what the localization option will be, that's not yet been decided. Thank you. Good to see you're making progress and good you're keeping this local. Thank you. Thank you. We continue with Patrick Hummel from UBS. Yeah, thanks. It is Patrick from UBS. Good morning, all. Also, two questions from my side, please. First one, you've decided to go for a solution that does not include an established cell maker as a joint venture partner. I'm sure you weighed the pros and cons of that decision. Can you just give us a short summary why you think this structure or this form of entity, a purely European solution, is a better one as opposed to just entering a joint venture on European grounds with an established Asian cell player? My second question, where does ACC stand in terms of securing the raw materials? We're seeing a pretty volatile price environment or in fact, prices for some raw mats have been up a lot. These are difficult supply chains from an ESG perspective, and I guess Mercedes-Benz has the highest standards here. I'm just wondering, where is ACC in terms of securing the raw mats required for what will probably be a very steep ramp-up curve a couple of years out? Thank you. Yeah. Thank you, Patrick. Of course, we have looked at the different initiatives that are going on, and I have to say, it's really positive to see how much dynamism is developing in Europe on the cell front, from my Swedish friends to other initiatives that are going on as well in Europe. We looked carefully at these, and in the discussions that we had with Stellantis and with TotalEnergies and also the ACC management, we felt that this offered the best option for us. Let's not forget that Saft has been in battery technologies, I think, for 100 years. In fact, it was Mercedes and Saft that launched the first lithium-ion production battery ever, I don't know, is it 15 years ago? 2009. Yeah, 2009. 12, 13 years ago. We know this company. We have ourselves amassed an enormous amount of know-how over the years in our R&D, as have they over the last years. Stellantis, especially with their operational skills and excellence, I think it was such a good mix. This also allows us here to step in deeper. Of course, we work in R&D with our current Asian suppliers. We work hand in hand with them and have deep insight to what we need for Mercedes. Here we go one step further. Here, we can take all those activities and investments that we're ourselves pouring into our new eCampus in Stuttgart and really leverage them in a bigger partnership. With a range of attractive options, this looked for us like the most attractive option. That's why we're going to bet on ACC to become a European champion in the cell space. With regard to sourcing of raw materials and so on, of course, ACC is working on this, but I don't think we, as a shareholder, should speak on behalf of them. They should then present their plans, and I will revert them to their management team. Ola, if I can just follow up here, does it mean that you're not taking care of this as Mercedes-Benz? This is going to be ACC's job. No, that would be wrong. If you're a third shareholder, of course, you will take care of that your shareholding and the company that you're engaged in will do this in the right way. As you saw already in the presentation end of July, we ourselves are now looking into the sourcing chain of raw materials. We have made one major deal already with Albemarle on the lithium side and are looking at others as well. The knowledge that we have gained throughout this process, of course, we will share that with ACC, but it's not like they're not thinking about this. They are very aware, and they're working on it as well. Got it. Thank you. Okay, the next in the line is José Asumendi from JP Morgan. Good morning. Thanks very much. José Asumendi, J.P. Morgan. Just a couple of questions, please. Can you talk a little bit about battery recycling? As you ramp up battery capacity in the coming years, how is ACC going to take care of this? Would you create a different entity outside of the ACC collaboration, or could this be within ACC? Second, Ola, can you talk a little bit about battery chemistry? How do you think about the right composition, the right technology, the right chemistry behind the battery? Also, you have a stake in a solid-state supplier. Could you bring the stake you have in this company into ACC or any collaboration or any outcome of this solid-state investment into ACC as well? Thank you. Yeah. José, hi. All things that you are mentioning are the things that you need to address as a cell maker, and all of those things are on the cards. With regard to recycling for us as Mercedes, but clearly for ACC, to make this ultimately a circular value chain is definitely a target. The latest recycling methods that are being developed, they look promising that we should be able to, and I'm talking globally here now, to have recycling quotas of those precious materials higher than 90% once we get to that stage. I'm going to pass the chemistry question to Markus Schäfer that is here, and with regard to solid-state, ACC has also stated that they're pursuing technology paths in this space as well. This is too early to be specific, but so are we, and I'm sure that we will intelligently put our heads together around this thing. Maybe Markus on chemistry. On the chemistry side, we're moving to our next generation of battery chemistry. We're going to the next level. I think we are able to provide highly competitive batteries today in the EQS, for example, but we're going to the next level, with ACC. It's a production in ACC, but we're doing joint development, we're using our development centers here in Germany and the new eCampus in Stuttgart, and combining our technologies, joining technologies with the R&D centers of ACC. Best of two worlds will end up in our next generation of battery, with high energy density, of course. In watt-hours per liter and per kilogram, we are improving significantly here. We are moving more to high silicon and to new recipes and new materials. We're expecting the next level with this next generation of batteries we're doing with ACC together. Very good. Thank you very much. The next colleague in the line is Horst Schneider from Bank of America. Yes, good morning. Thanks for taking my questions. I have got a couple. You made some comments on ACC and technology now already. I still want better to understand why you have finally taken ACC. Was it just a lack of partner or ACC was really the best partner, and you figured out that they have got a technology advantage, and then you can source batteries here cheaper than as compared to other players? You just wanted to reduce, for example, the dependency on the Asian players? I just want to understand why ACC. The other question that I have relates to the Farasis deal, because it's still in the room that you aim to build up this battery plant in Bitterfeld. Is that still on the agenda or does this deal basically then replace it in a way the Farasis deal or just amend it? These are my two main questions. Thank you. I'll start from the top. We have very strong relationship with suppliers in Asia. Two of those partnerships are CATL and Farasis, and they are yielding very good results. You can see the performance of the vehicles that we're putting into the market today. Those are based upon the work that we have done with CATL and with Farasis. It goes without saying that these strategic partnerships will continue, and we will build upon them. No doubt whatsoever. However, as we mentioned in the presentation in July, we said that, in a world that, in our view, is going to go all electric, we think it's wise to spread the sourcing, or put another leg on the stool of that sourcing. We think that Europe should be a player in this field. To complement the relationships that we have in Asia, to build up a European champion, we think is the right move for us, and we think it's the right move for the European automotive industry. Why did we pick ACC? Let me start by saying this. Every single serious venture in the cell space in Europe has approached us and wants to work with us. Without any exception, we could pick anybody we would like in Europe to work with us because we're an attractive brand, and we have a very progressive strategy. We have gone through a thorough evaluation of all the options, which are several, and looked at from a technological point of view, a complementing skills point of view, industrialization, cost structures, financing model, I mean, a 360-degree review. What do we think is the best for us? In my conversations with Carlos Tavares and Patrick Pouyanné from the other two players and my team's conversations with the ACC management team, we are convinced that this, at this juncture for us, is the best option. That's what we're going in and doing this. We will, of course, on the way to 2030 and beyond, remain open for sourcing. This is a serious and big initiative for us in Europe and will cover a significant amount of the gigawatt needs that we will need here. With regard to Farasis' plans, Markus is on the board of Farasis and speak to them all the time. Why don't you say a few words about that? Well, as we are reading sometimes some updates on Farasis. The facts are that the performance of Farasis in our vehicles is really outstanding and continues to be outstanding when it comes to range, cost, and charging time. A very important partner. We are expanding capacities right now in the existing plant rapidly. It's up to Farasis finally, just to focus their resources. They need to focus their resources. They're a young company. They are growing rapidly at the moment, and they have to make their decisions about their next steps in Europe, and they will in the future. We have to leave it up to them and their growth path and their capabilities, to take the timing, the right timing, to announce the next steps. Most important is the supply secured for us here and the right technology is available to us. All right. Excellent. Thank you. We continue with Stephen Reitman from Societe Generale. Yes. Good morning. Thank you for doing this call. My question is about the costing on the project. More than EUR 7 billion by 2030 to establish capacity of 120 GWh. It seems relatively good value, when I consider that looking at past press releases from ACC, I'm looking at one from September last year, in which they were talking about, at the time, building up to 48 GW of capacity at a cost of up EUR 5 billion or more than EUR 5 billion. Can you explain the confidence about the figures, getting up to more than doubling of that 48 GW capacity at a relatively low price? Thank you very much. Stephen, you will see a significant scale effect where you make initial investments into R&D and all sorts of things that you need to get going. Once you then duplicate and replicate that, and ramp up to more gigawatt-hours, they feel that there is going to be a significant scale advantage. We are looking at the numbers as well. It is not like we do not have any experience. We have been doing this with several other suppliers, so we know roughly what the numbers should be. Even some years ago, we had built our own plant, so what the equipment cost and so on and so forth. The plan with the EUR 7 billion from today's point of view, to get up to 120 GWh looks robust. Thank you. We continue with Harald Hendrikse from Morgan Stanley. Morning, guys. Harald. Thank you so much for doing this call. Great deal. Very practical decision it seems as I think we're starting to get used to. My question a little bit is, you're kind of interesting. Mercedes-Benz cars are very different from Stellantis cars, especially in Europe. Now we're in the same joint venture. I'm assuming we're going to have the same cells and the same chemistry. Firstly, to what degree would you have a choice to change the chemistry for Mercedes-Benz, for example, versus a Peugeot? Secondly, if we're going to share cells, which is incredibly sensible, but does it also then start to make sense to start thinking about sharing modules? How should we think about that? I think all the OEMs globally are sort of investing in the same things at the moment. I suspect there might be others in Europe or elsewhere who might want to joint venture as well. On top of that, would you think about sharing modules at some stage? Lastly, would you take new partners into the venture? It seems 120 GW is a pretty ambitious target, but obviously Europe needs probably 1,000 GW by that time. It seems that this venture could even get bigger. Would you take new partners into the venture to maybe pay for further expansion? Let's start with the first thing, and this is kind of a truth for any cell supplier, including ACC. Also, if you take a CATL that more or less delivers to every OEM in the meantime, each OEM has to decide what they need and what their technical requirements are, in terms of performance, range, charging time, et cetera. We very specifically, with our cell suppliers today, go in and bring our recipe to the table in a way, even though the cooking method is a common denominator in the NMC world. We will do the same thing with ACC that we're doing with the others that we're working with, that we will specifically look at what we need and make sure that we get that. If another manufacturer decides to buy equal or same performance per liter, then of course you have also economies of scale there. That goes for cell supply today and cell supply tomorrow. For competitive reasons, we don't share our plans with Stellantis, nor do they share with us. There we are two customers, and the technical teams will work with ACC in a normal supply partner fashion. With regard to where you take it third-party business and how you go further. Now we have put together this plan. We have put in our demands. Stellantis obviously have put in theirs. Where it goes from there, I think it's too early to say now. Just with the engagement that the two of us are bringing to the table, it's quite sizable. Time will tell how far this can go. Okay. Sorry, on the modules, does it make sense or am I taking it too far right now? Yeah. I would say it depends. We have a modular strategy for our vehicles that fits into the several different models on one architecture. I honestly don't know what others do, but we will make sure that we have a very intelligent scaling and module strategy for Mercedes. Thank you. We continue with Henning Cosman from HSBC. Yeah. Hi, good morning. Thank you for taking the question. I just had one more. Thank you for giving all these numbers in the press release. I'm just trying to make a little bit more sense of them when you talk about the eight factories that you're going to be needing 200 G Wh. I imagine that means four factories for yourself or you say four factories in Europe, so supposedly half of that. If you get half of the 120 GWh of ACC, there's still a balance of 40. Can you just sort of talk about the balance a little bit? Is the remainder just to come from sourcing? Do you literally mean you want to build eight gigafactories, meaning over time you're going to be replacing the existing supply arrangements, or are you thinking about doing that with your existing partners, but you want larger equity stakes, similar joint venture structures, to get a better handle and supply security globally as well? Can you just talk about that a little bit more, please? Thank you. In our presentation in July, I don't know if you had the opportunity to see it, we have already established supply relationships. Obviously, we're not going to throw away the factories that we have built. There will be technological evolution. If we want to go all in on electric, we need something like 200 GWh, which is way beyond what we have already set up for the path to 2025. We're going to need more. It's not about replacing one that was just built. This is one piece of the puzzle with ACC on the path to those 200 GWh. Okay. Thank you. The next one in the line is Kai Mueller from Barclays. Hi, thank you very much for taking my question. Maybe just to add what Henning was just asking. If you think about these relationships going forward and these 120 GW capacity that you have in this JV, is it fair to assume that it's 50/50 split between the two OEMs taking part in that, Stellantis and you? The second question is, we talked a little bit about the chemistry, and we all know that Stellantis is focusing very much on NMC. You are doing NMC as well, but you've mentioned in July the potential to do LFP 2.0. Would that JV also focus on that, or are you looking at other providers for this? As a last question, just when you think about how vertically integrated this JV is, are you really focusing solely on the cell production and are you doing the packaging yourself, or what is actually the output of this JV all the way to your production line? Individual production volumes are not being disclosed, and ACC will not do that, of course. If you start with two customers, then you can speculate about shares, obviously. That's not being individually disclosed. In terms of what level of vertical integration, you can do cells, you can do modules. Both of those things are on the table. With regard to technologies, our initial protocol with ACC will be focusing on the NMC technology. Very clear. Thank you very much. Ladies and gentlemen, thank you for your questions and for being with us today. Thank you very much to Ola, Markus, and Harald. Now Investor Relation remains at your disposal to answer any further questions. To all of you, have a great morning, great afternoon, or great evening, and we look forward to talking to you soon. Thanks and goodbye.