Daimler faces a huge transformation over the next five years.

         Daimler AG will become a smaller company in five years, focusing on recurring revenue from software services and redefining luxury cars in the era of electric smart cars, CHIEF Executive Klaus Konlinson said, Reuters reported.

         "In the next five years, we will be a smaller company," Kang told Reuters. "We will fundamentally transform the industry in terms of powertrains."

        The Stuttgart, Germany-based company was founded by Carl Benz, who in 1886 patented the world's first gasoline-powered car. However, the cuts come in the wake of the company's recent attempt to cut its traditional fuel engine business. The job cuts are needed because electric cars have fewer production lines than conventional gas-powered vehicles.

       Analysts at ING say electric cars have only 200 parts for their batteries and motors, compared with at least 1,400 for the combustion engine and gearbox alone.

      The shift will require carmakers to cut their workforce by at least half and shift more jobs to electric and intelligent vehicles, He said, adding that Daimler is hiring many new software engineers and experts in battery chemistry and vehicle electrification.

       In the future, luxury cars will no longer be defined by "grandeur" and "supersize", but by "sustainability" and "efficiency". So, in addition to resizing its staff, Daimler also plans to resize its car products. "We are very clear that this product needs to leave a smaller 'footprint' on the planet, which is what modern luxury cars have to do," Mr Kang said.

       To build its EQ line, Daimler is dispatching experts from formula One racing teams. According to Daimler, the EQ series is focused on creating the most efficient electric car, with the goal of driving from Stuttgart, Germany, to Marseille, France, once fully charged. It is a "preparatory" project that introduces a lot of new technology, Says Mr Kanglinsong. 

       Daimler also plans to offer new digital services to car owners, such as assisted driving and infotainment programs, while also creating new revenue streams. By 2024, the service is expected to be available with a new on-board operating system. "Think of it like the iPhone, and with software updates, new services and features will be included," Mr. Konlinson emphasized.

       In terms of digital technology, Daimler plans to develop new models in the Chinese market and tap the growth potential of the Chinese market. Mercedes-benz had previously said the Chinese market had the greatest growth potential over the next decade.

      "It is possible for us to reach a critical level of penetration for a single model in China," he said, but added: "No decision has been made to localise the new series in China, and that depends on how the market develops."