CEO Ola Källenius has long since named two key topics for Mercedes-Benz: electrification and vehicle software.

Now the organization of the car manufacturer is geared even more towards the topic of digitization.

Mercedes is installing a “Chief Software Officer” who is to assume overall responsibility for the vehicle operating system MB.OS.

The 48-year-old Swede Magnus Östberg, who after completing his master’s degree in electrical engineering made a career with several suppliers with a focus on vehicle software, will take over the position at Mercedes on September 1st.

Susanne Preuss

Business correspondent in Stuttgart.

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However, Östberg will not receive a board post.

Östberg is in demand as a proven software expert.

“It's about the backbone of the entire vehicle,” said a spokesman for the automaker, explaining the overarching significance of this position.

Östberg will report to both COO Markus Schäfer and CEO Ola Källenius.

This means that the Board of Management of Mercedes-Benz AG will be reduced by one member shortly before the planned split-up of the Daimler Group (into one company each for passenger cars and one for commercial vehicles).

While the position of Chief Software Officer will be created for Östberg, there will be no “Chief Technology Officer” in the future.

In this board position, Sajjad Khan was responsible for the development in the technical areas, which were summarized under the abbreviation CASE (Connectivity, Autonomous, Shared & Services and Electric) in the days of Daimler boss Dieter Zetsche. These “speedboats” of technological progress are no longer needed, goes the logic of the conversion: Mercedes itself must now be a speedboat. Interpersonal and professional differences, which are said to have existed primarily between Sajjad Khan and Markus Schäfer, may also have played a role in the reorganization.

The Pakistani goes from the board of directors with express praise and thanks. “Sajjad Khan made a decisive contribution to digitization at Mercedes-Benz and significantly shaped the product portfolio. With MBUX, he has created a system that defines a new benchmark in the automotive sector, ”Daimler supervisory board chairman Bernd Pischetsrieder is quoted in a message from Mercedes.

The Stuttgart-based car manufacturer also supports Khan in his next professional step towards self-employment as an investor.

47-year-old Khan will set up a technology-focused venture capital fund and has won his previous employer as a significant funder to do so.

Details have not yet been settled, it is said in Stuttgart, but: “I am delighted that we as Mercedes-Benz are allowed to accompany him as an angel investor in this innovative project,” CEO Ola Källenius is quoted in the announcement.

The goal is called MB.OS

With technological expertise and strategic vision, Sajjad Khan laid the foundations for MB.OS, says Källenius. The abbreviation stands for an operating system - but also for a fundamental strategic decision by Mercedes: "We rely on our own software platform for our vehicles." Level and for other applications from our own development. MB.OS is to be installed in Mercedes cars as a separate, data-supported system from 2024 onwards.

It is about the linking of all electronic requirements within a vehicle. At Mercedes, a comparison is made with the “central nervous system” in the human body, without which the complexity of the functions cannot be mastered, regardless of how good the individual functions are. So this means that Mercedes does indeed fall back on the expertise of other companies in the IT sector. For example, the central computer could come from suppliers such as ZF or Bosch, while Mercedes works with Microsoft Azure for cloud services.

The intelligent linking of the different software and electronic systems is seen by Mercedes as a decisive success factor for digital innovations. The slogan is to create a “safe, comfortable, but also luxurious customer experience” in the car of the future. An initial indication of the direction in which the premium car is likely to develop is provided, for example, by the hyperscreen, which leads across the vehicle in the new S-Class and enables intuitive operation of the car and all of its functions.

In order to accelerate the transformation towards digitization, Mercedes wants to create 3000 new jobs in the tech hubs in Berlin, Tel Aviv, Seattle, Sunnyvale, Beijing, Tokyo and Bengaluru. The automaker wants to hire 1,000 additional employees in Sindelfingen alone. At the location near Stuttgart, where mainly the S-Class luxury sedan and (in the fully networked Factory 56) also the electric EQS ​​are assembled, important parts of the development department with several thousand employees are traditionally located. The central campus for the MB.OS operating system is now to be built here on 65,000 square meters, around eight soccer fields.

They want to take their time until next summer to find the best software experts. “You need people who understand the complexity of a car,” commented a Mercedes spokesman on the importance of this recruiting task. In order to find such staff, Mercedes agreed with the works council in June to create different framework conditions for employees in software development than for staff working in traditional areas - with more independence and individual creative freedom and a more performance-oriented one Compensation.