Mercedes-Benz announced executive management changes on Wednesday, with production head Joerg Burzer set to replace Chief Technology Officer Markus Schaefer. The reshuffle aims to improve cost efficiency by creating a younger board of directors.

The German automaker stated that 55-year-old Burzer will oversee both research and development and procurement operations from early December, while serving as Chief Technology Officer.

Schaefer, who led Mercedes' transition from traditional fuel vehicles to electric vehicles during his tenure, will leave the company after 30 years of service.

Michael Schiebe, 42, currently head of the high-performance Mercedes-AMG division, will join the board of directors to oversee production operations.

Mercedes supervisory board chairman Martin Brudermueller stated: "Both Joerg Burzer and Michael Schiebe are excellent managers developed within the group, and they will take charge of core departments that are crucial to the future development of Mercedes-Benz Group."

Mercedes described these appointments as part of the company's strategy to inject "new energy into the group and strategically rejuvenate the board of directors."

Currently, Mercedes and its peers face multiple challenges: slowing growth in electric vehicle demand, intensifying competition in the Chinese market, and the need for comprehensive cost reduction during the strategic transition from fuel vehicles to new energy vehicles. These management changes are taking place against this backdrop.