Mercedes-Benz Group announced a massive investment plan on Wednesday to enrich its portfolio of locally made vehicles in China, its largest market in the world.

Together with its Chinese partners, it is planning to spend over 14 billion yuan ($1.97 billion) to introduce a number of vehicles based on new architectures.

Statistics show that Mercedes-Benz and its local partners invested over 100 billion yuan in China from 2014 to 2023.

The new move comes as local Chinese NEV startups threaten to steal the limelight and allure away customers from global premium marques including Mercedes.

The German carmaker said it will start a new chapter in China from 2025, led by the local production of the all-new long-wheelbase electric CLA and an all-new long-wheelbase derivative of the GLE SUV, as well as an all-new luxury electric van model based on the VAN.EA architecture.

The long-wheelbase electric CLA, tailored for Chinese car buyers, will be built based on the Mercedes Modular Architecture, whose new technologies were teased in the Concept CLA Class last year.

The Mercedes-Benz Operating System, which is developed in-house, will debut alongside the premiere of all-new models based on the MMA platform in 2025.

Among other things, it features a new virtual assistant that uses generative AI and advanced 3D graphics, and the first HD-mapless point-to-point urban intelligent driving system among premium brands.

The new long-wheelbase GLE SUV is for the first time developed by the local R&D team, including China-exclusive rear seat comfort and leading intelligent technology, said the German carmaker.

Analysts said chances are fat for traditional premium carmakers to win customers back gradually as long as they can offer smart cutting-edge functions seen in Chinese brands, based on those global brands' reputation earned by their strict and proven standards in terms of manufacturing and quality control.