Daimler refutes report it will slash Mercedes-Benz EQC production

German auto group Daimler has put a stop to reports that it would be slashing production of its flagship all-electric EQC SUV due to battery supply issues, saying original production plans to make 50,000 EQCs a year remain in place.

Manager Magazin reported on Thursday (Europe time) that Daimler would only make half the 50-60,000 vehicles originally planned, and that 30,000 a year – at most – could be expected.

The report added that even though Daimler hoped to sell 25,000 EQC vehicles in 2019 it had only made 7,000 also because of a shortage of batteries from supplier LG Chem.

But the automaker has denied the reports, with Damiler spokesman Joerg Howe telling Reuters overnight that “Daimler plans to produce around 50,000 Mercedes-Benz EQC models in 2020.” No more details were given.

Daimler began readying itself for a transition to electric drivetrains in December 2018, placing €20 billion ($A32 billion) worth of orders for electric vehicle batteries aimed at supplying production needs for 130 all-electric and plug-in hybrid variants.

LG Chem had already been selected as the supplier for one of the group’s first electric models, the Smart EV, it was reported by Electric Vehicles Research in 2016, and in 2017 the South Korean battery maker announced it would be the first such company to make batteries in Europe by building an EV battery factory in Poland.

It recently accepted a long-term loan of €250 million ($A403 million) from the European Bank for Reconstruction and Development (EBRD) which it will use to support the construction of a €2.8 billion ($A4.52 billion) gigafactory in Wrocław in western Poland with an aim to reach an annual capacity of 65-70gWh by 2022.

It is thought that once it reaches full capacity, the factory will supply batteries for as many as 1 million EVs a year, or 6% of cars sold in Europe.

Mercedes-Benz started taking orders for the EQC in Australia in late 2019 with first deliveries expected in early 2020, saying at the Australian launch that orders were already outstripping supply and that it would ramp up supply locally throughout 2020.