At the Munich Auto Show, there was an unmistakable shift in energy. For the first time in years, Tesla wasn’t the sole centre of attention. All eyes were on BMW and Mercedes-Benz, each unveiling a bold electric SUV, fully electric, meticulously engineered, and designed to challenge Tesla’s Model Y—not just in Europe, but globally.

As an automotive journalist walking the floor, I’ve seen concept cars come and go. But the atmosphere around BMW’s iX3 and Mercedes’ electric GLC felt different. Not only were these cars ready for production, but they were also speaking directly to a more informed, demanding, and globally connected buyer.

BMW’s Neue Klasse: A Statement, Not Just a Platform

The BMW iX3, carrying the Neue Klasse platform for itself, marks, beyond a product release, a multi-billion-euro investment to set the tone of BMW’s identity in an electric future. The numbers reflect ambition: over 497 miles of WLTP range, more than 400 miles by EPA standards, and a charging system capable of adding 230 miles in ten minutes via 400 kW DC fast charging.

For those following the brand, this is a massive jump. BMW has claimed its “superbrains”—advanced in-car computer systems—have 20 times the computing power of current models. These include in-vehicle communication power, autonomous functions, and a refreshed interface, complete with a 43.3-inch panoramic iDrive display. It’s sleek but not overdone. Sitting in the prototype, what struck me was how BMW managed to create a balance between analogue and digital—something Tesla often bypasses in favour of full minimalism.

Production of the iX3 will begin in Hungary in 2026. While the launch timeline means Tesla still has time on its side, BMW’s roadmap is clear: six Neue Klasse models by 2027, with EVs projected to represent 50% of global sales by 2030.

Mercedes-Benz Brings Precision to the Electric GLC

Across the hall, Mercedes-Benz presented its electric GLC built on the MB.EA platform. If BMW is betting on digital integration, Mercedes is doubling down on refined engineering wrapped in comfort. The WLTP-rated range of 443 miles puts it just behind the iX3, but it compensates with a dual-motor 483 hp setup, a twin-speed rear transmission, and one of the most thoughtful suspension systems in the segment.

Using Airmatic adaptive suspension and “Car-to-X” intelligence, the vehicle adjusts its ride based on road data from navigation systems. This is the kind of feature you may not notice on a short test drive, but you’ll appreciate after hours on a highway with inconsistent surfaces.

The 330 kW fast charging isn’t far off BMW’s offering, and the interior matches expectations: a large optional MBUX Hyperscreen, wireless charging, and a return to physical controls that many drivers still prefer. Mercedes will also start production in 2026.

Tesla’s Position and the Pressure to Evolve

Globally, Tesla still holds a commanding lead. The Model Y is still the best-selling electric vehicle in the world. In 2023, over 1.2 million Model Ys were shipped across the world through Tesla’s hands, and the continent of Europe saw over 200,000 units sold. But the cracks started showing. Sales in Europe have softened in recent quarters, in part due to factory retooling at its Berlin gigafactory and also due to increasing scrutiny from EU regulators.

More importantly, the competition has moved past the early stages. BMW and Mercedes are not just creating alternatives. They’re targeting Tesla’s exact demographic—tech-conscious, design-sensitive, and performance-driven consumers.

Tesla’s Model Y has an EPA range of up to 310 miles and supports fast charging up to 250 kW, but its interior still polarises buyers. The software is polished but closed. Updates are fast, but there’s less customisation. The new German SUVs seek to offer a more personalised, hardware-agnostic experience.

What Global Buyers Should Consider

As more countries push toward full electrification by 2035, buyers are left with a narrowing window to make long-term EV decisions. These launches expand the playing field.

For buyers in North America, the BMW iX3 and Mercedes’ electric GLC won’t arrive until 2026. In Asia, where EV adoption is surging—especially in markets like South Korea and China—these models will need to prove themselves against aggressive domestic competition, particularly from BYD and Nio. In regions like the Middle East, where premium vehicles retain strong cachet, range and build quality will be key.

Global charging infrastructure remains uneven. Tesla’s Supercharger network is still the most extensive, but both BMW and Mercedes have signed agreements with Ionity and other consortia to expand access. Buyers should verify regional coverage before making a choice.

Legacy vs Leadership: An Industry Shift

The emergence of BMW and Mercedes in this space is not just about EV adoption. It’s about reclaiming relevance. For years, Tesla has defined what an electric car should be. These new entries suggest that legacy carmakers are now ready to redefine that narrative.

I spoke with engineers on the floor who described the transition not in terms of horsepower or battery size but in terms of digital sovereignty. Both brands are shifting toward proprietary software stacks, vertical integration, and data-driven R&D.

What this means for you as a buyer is more over-the-air updates, more predictive maintenance, and fewer trips to service centres. It also signals that future value will come not just from hardware but from the digital services layered on top.

The China Factor: Competitive Pressure from the East

Of course, there is no way any analysis could refrain from commenting on the increase in the presence of these Chinese EV makers in Europe and perhaps elsewhere. At the same show, BYD launched a variety of competitively specced models at a fraction of the price. Companies like XPeng and Nio are also entering European markets with strategic intent.

BMW and Mercedes cannot compete on price. They’re betting on quality, long-term ownership experience, and heritage. Whether that strategy works depends on how global consumers weigh price versus provenance.

How the Landscape Is Shaping Up

The EV transition isn’t just about cars. It’s about ecosystems, energy policies, and shifting consumer expectations. Tesla proved it could lead on all fronts. BMW and Mercedes now believe they can do the same—on their terms.

As we move toward 2026, the choices available to EV buyers will multiply. Some will wait for the promise of longer range and better software. Others may opt for what’s available now.

Either way, the electric SUV segment has entered a new phase.

And that’s good for all of us.