new York The CEO of the US chip manufacturer Nvidia, Jensen Huang, emphasizes the great importance of the recently concluded development partnership with Mercedes-Benz. “Mercedes is an incredible partner. I can’t imagine a better partner,” he said on Thursday evening.
“Mercedes will become the most valuable luxury brand on the planet. And they are technologically very advanced,” Huang continues. “Ola [Källenius] is a visionary,” is his verdict on the CEO of the German car manufacturer.
Huang commented on the latest quarterly figures during a virtual press conference. These were weaker than hoped: Due to supply chain problems, Nvidia is expecting revenues of $8.1 billion in the current quarter, which is less than analysts had expected. On the stock exchange, the share rose by more than five percent on Thursday.
One growth driver for the future is the car business. That’s going to be “very important,” according to Huang. The division is still small: Nvidia achieved sales of 566 million dollars in the segment in the financial year 2021, an increase of six percent. But in the next six years you want to achieve income of eleven billion dollars, according to the Nvidia boss.
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The partnership with Mercedes should also make this possible. As the Handelsblatt reported in February, both companies will jointly offer more software packages for automated driving functions from 2024. Nvidia will be allowed to keep more than 40 percent of the revenue as part of a “revenue sharing” model – a first in the automotive industry.
>> Read also: “Luxury must also stand for more in-house production” – Mercedes wants to hire more software engineers
The plan is viewed critically in Stuttgart, as it puts the Swabians in a long-term and expensive dependency on Nvidia. The project is highly lucrative for Nvidia.
Preferred delivery?
When asked by the Handelsblatt on Thursday evening, Huang emphasized the advantages of the partnership for Mercedes. It is true that 20 car companies are supplied with their own chips, eight robotaxi companies and seven truck manufacturers: “Ours [Autostrategie] is to help any company that wants to automate their systems.”
In the case of Mercedes, however, they rely on a different business model – a “super deep” partnership. “The background is that we will build the data centers and the car computers together,” says Huang. They are working with Mercedes to develop the entire workflow and applications: “We will deliver that and equip Mercedes cars for the next 20 years.”
“We work very hard to ensure that the best technology is used in the fleet,” Huang continues. “Mercedes will come first in many, many areas.”
According to insiders, Huang and Mercedes boss Källenius get on well together. Just a day ago, the Swede posted a picture on the LinkedIn social network that showed him relaxed with Huang – according to Källenius a “good friend” – at the wheel of a Mercedes.
According to observers, it is clear who sets the tone in the partnership. Mercedes is urgently dependent on the Nvidia chips because the Swabians cannot design their own semiconductors like Tesla. Nvidia chips are considered the leaders. The next chip generation “Atlan” should set new speed records.
When asked whether Mercedes will be the first automaker to receive the “Atlan” chips from 2025 due to the special partnership, Huang replies: “I have an even better surprise for you. I would say Mercedes has access to everything Nvidia has.”
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