The Mercedes S 500 Intelligent Drive covered more than 100 km autonomously (Photo: Daimler

FRANKFURT ”“ Dieter Zetsche is not afraid of competition from new entrants into the market for personal mobility.

The Daimler CEO said he respects initiatives by new automakers and players from other industries to get traction in a car market that is changing rapidly.

"We definitely take those attempts seriously," Zetsche said in a press briefing at the Frankfurt auto show (IAA) Tuesday. "But we are not without some know-how as far as bits and bytes are concerned."

Auto-industry analysts have been speculating that the fully connected car, powertrain electrification and changing car buying habits may provide a potential opening for IT groups, telecommunications companies, electric utilities and others to enter the automotive market.

Zetsche said a carmaker such as Daimler is better positioned to integrate IT into its cars than a company from another industry. Citing Daimler's most recent IT innovations, he said these are essential to remain competitive in a changing industry. "We don't want to be the steam-powered locomotive at the end of the day," Zetsche said.

The Daimler chief said the German premium car maker is happy to cooperate with companies such as Google, Tesla and others. "We're not afraid or scared that we couldn't keep up with them," he said.

Daimler, which owns 5 pc of electric sports car maker Tesla, unveiled an electric version of its Mercedes B-Class sedan at the Frankfurt auto show. The car takes its battery-driven powertrain from Tesla's new Model S.

The carmaker also showed an S-500 plug-in hybrid, whichburns the equivalent of 3 liters of fuel per 100km. And it showed an S 500 Intelligent Drive test vehicle that had successfully driven a 103km route autonomously with the help of sensors and computers.

Said Zetsche: The S 500 Intelligent Drive has taken us very close to our goal of accident-free driving."