By pooling the market knowledge of Mercedes-Benz with the manufacturing experience of Bosch, the companies claim the venture will increase the speed at which new technology can be developed, as well as creating cost-cutting synergies.

Joint production is expected to start in 2012, initially for Mercedes-Benz and Smart electric vehicles before being sold on to other manufacturers through Bosch. Negotiations are expected to be completed by the end of 2011.