Mercedes invests in China’s $8.3B AI car startup Qianli

Mercedes-Benz buys 3% stake in China’s big AI car tech firm

Mercedes-Benz acquired a minority stake in a Chinese company called Chongqing Qianli Technology to support its electric car plans in China. This tech helps cars drive themselves using computer power, which Mercedes needs to stay ahead in the fast-moving car market.

Mercedes paid a substantial amount for this small stake, which represents a 3% ownership. The cost was 1.34 billion yuan, equivalent to approximately $187.9 million in US dollars. The whole Qianli company is valued at around $8.4 billion. Mercedes will hold onto its 135.63 million shares for at least a year.

China dominates global electric vehicle production with 70% share

China is the global leader in making electric cars. In 2024, China built more than 70% of all the electric vehicles (EVs) worldwide, according to the International Energy Agency. This vast number highlights the significant lead Chinese factories have in building clean cars.

In 2024, car manufacturers worldwide produced a total of 17.3 million electric cars. China alone was responsible for making 12.4 million of those units. Chinese domestic car companies produced most of these cars, accounting for over 80% of all electric cars built in China that year.

EU tariffs of up to 48% on Chinese EVs accelerate local manufacturing

European countries attempted to protect their car manufacturers by imposing an additional tax, known as a tariff, on Chinese electric cars. This tax is intended to increase the cost of Chinese cars in Europe. These extra taxes can add up to 45.3% on some cars from uncooperative firms, in addition to the standard 10% duty.

The tariffs vary by company. BYD has an extra duty of 17%, Geely has 19.3%, and SAIC has 35.3%. These high taxes have not deterred the Chinese car companies, but have prompted them to adjust their plans. For example, BYD is now building a factory in Hungary.

Mercedes’ stake in Qianli for AI integration in China-tailored EVs

Mercedes is investing in Qianli to quickly integrate the latest computer brains into its cars, specifically for the Chinese market. Qianli is a leader in AI and autonomous driving, which means self-driving smarts. Mercedes needs this tech to make its cars appealing to Chinese buyers.

This wise tech investment is part of Mercedes’ plan to allocate $2 billion to manufacturing its EV parts in China. Chinese car buyers want this new tech: 90% are willing to pay extra for advanced, innovative driving features in their new cars.

Stellantis invests €1.5 billion in Leapmotor to access high-tech EVs

It is not just Mercedes that deals with China; other major European car groups are also doing so. Stellantis, which owns brands like Jeep, gave €1.5 billion to a Chinese EV company called Leapmotor in 2023. This enormous amount of money gave Stellantis a 20% stake in the Chinese company.

Stellantis also gained control over selling Leapmotor’s cars outside of China by acquiring a 51% stake in its international business. This partnership enables Leapmotor to utilize a Stellantis factory in Spain, which helps Chinese cars avoid European taxes that can be as high as 30.7%.

CATL’s €7.3 billion Hungarian gigafactory secures battery supply for Europe

Another giant Chinese company, CATL, is a world leader in car batteries and is making a big move in Europe. CATL is investing a massive €7.34 billion to build a giant battery factory, known as a gigafactory, in Debrecen, Hungary. This helps Europe get batteries easily.

CATL makes the most EV batteries globally, holding a 38% market share globally in 2024. This new giant factory will produce 100 GWh of batteries for major European car companies, including BMW and Volkswagen. The local government is undertaking a $2 billion project to enhance the surrounding area of the factory.

Chinese EVs at €32,000 average capture 25% of EU sales

A significant reason Chinese cars are selling so well is that they are affordable. Analysts estimate that around 19–20% of EU EV sales were made in China from 2023 to H1 2024 (including non-Chinese brands built there). Chinese EVs are often priced below European averages, a key reason for their momentum.

These lower-priced cars have been a huge hit, capturing a significant portion of the market. Experts say that one of every four electric cars sold in the European Union, 25% of all sales, is now from a Chinese brand. This represents a significant leap from a 1% market share in 2019.

Mercedes-Benz’s history of strategic tech partnerships with Chinese firms

Mercedes-Benz has a history of collaborating with Chinese tech companies to develop better cars for the Chinese market. Early on, the company required local assistance to keep pace with the rapid changes in the Chinese market. This is why the Qianli deal is not the first of its kind.

Mercedes was the first international car company to invest in the Chinese self-driving car company Momenta in 2017. This move showed that Mercedes was serious about using Chinese technology. After that first deal, the two companies worked to improve car features for years.

Mercedes and Momenta co-develop next-gen intelligent driver system

Mercedes and Momenta have collaborated closely to develop a new Intelligent Driver Assistance System. They designed this special system for China’s jam-packed, unique roads and traffic. This ensures that the self-driving features work optimally for local drivers.

Mercedes plans to introduce Momenta software on at least four China-market models between 2025 and 2027. The system uses Momenta’s newest AI model technology. All the training data used to teach the AI how to drive safely comes directly from testing on Chinese roads.

Mercedes partners with ByteDance for smart assisted driving AI

Mercedes signed another significant deal with the Chinese tech giant ByteDance on September 23, 2025. ByteDance is the company that owns TikTok. This new deal focuses on enhancing smart-assisted driving and the car’s computer screen display area.

The new electric CLA car will get ByteDance’s special Doubao AI virtual helper. This AI can even understand different Chinese languages and pick up on feelings. The new CLA car will also have a long driving range of 866 kilometers before needing a charge.

Mercedes’ $2 billion investment to localize China’s EV supply chain

The Qianli investment is part of a larger plan by Mercedes to invest in its electric cars in China. The company has promised a significant $2 billion investment in China’s EV supply chain. This money is used to make car parts and assemble more cars in China.

This money adds popular features to cars like the long-wheelbase EQS and GLE SUV. Mercedes focuses on providing Chinese customers with the best rear-seat comfort and the most innovative intelligent infotainment systems, the prominent features that local buyers are looking for.

Mercedes-Benz made China’s largest R&D hub outside of Germany

To keep up with the fast pace of Chinese technology, Mercedes-Benz built a large facility for inventing and designing new products, known as an R&D hub. This center is where they can work on cars and features made just for Chinese customers.

This large R&D center in China is now the company’s single largest R&D hub outside of its home country of Germany. Having a large local team enables them to work closely with Chinese tech companies. This has also helped them to significantly shorten the development-to-production cycle.

Geely’s ecosystem connects to Qianli, Polestar, and Lotus brands

The Chinese partner in the Mercedes deal, Chongqing Qianli, is a company backed by the giant car group Geely. This connection is crucial because it links Mercedes to Geely’s entire car family, which is big and famous worldwide.

Geely owns the electric performance car brand Polestar and the British sports car company Lotus. This suggests that the future of the car industry will involve combining a strong European brand, such as Mercedes, with the speed and advanced technology of Chinese companies like Geely.

Mercedes pension trust sold $346M stake in Nissan in August 2025

Before the new deal with Qianli, Mercedes-Benz changed some of its money plans. In August 2025, the company’s pension trust sold its entire share of the Japanese car company Nissan Motor. This sale indicates that Mercedes is shifting its focus.

The trust sold its stake, a 3.8% ownership in Nissan. This sale was valued at approximately $346 million in U.S. dollars. This significant shift of funds from an old partner to a new Chinese tech partner clearly indicates where Mercedes believes the future of cars is heading.

Want to see how fast charging is getting a serious upgrade? Check out Mercedes launches ultra-fast chargers with megawatt power.

Future mergers and acquisitions projected to prioritize cross-border synergy

Experts believe the deal between Mercedes and Qianli is just the beginning of many more business partnerships. European companies must buy or partner with Chinese firms to access their top technology, such as advanced batteries and innovative AI systems. This is called M&A.

A 2025 report by EY predicts that European carmakers will sell more electric cars than gasoline cars by 2028. This race is forcing companies to partner across borders. These deals mix the trusted names of Europe with the fast, new ideas and technology from China.

Wondering why rivals are teaming up under the hood? Dive into Future Mercedes models could be powered by BMW engines.

What’s your take on this bold Mercedes move?

Read More From This Brand:

• China competition and US tariffs drag down Mercedes earnings
• Another curveball from China raises eyebrows over EV numbers
• Major Automaker Cuts EV Budget to Invest in Gas and Diesel Cars

Don’t forget to follow us for more exclusive content right here on MSN

If you liked this story, you’ll LOVE our FREE emails. Join today and be the first to get stories like this one

This slideshow was made with AI assistance and human editing.