Mercedes and Microsoft Team up to Turn the Car into a Smarter, Safer Workplace

As a growing normalization of hybrid work blurs the boundaries between home, office, and commute, some carmakers are beginning to view the vehicle as an extension of the digital workspace. Mercedes-Benz has expanded its partnership with Microsoft to integrate Teams video calls, Intune device management, and 365 Copilot into the next-generation CLA and GLC via MB.OS. The updated Teams app enables driver-facing video while on the road, though content from others remains hidden to meet safety standards.

Microsoft Intune allows Information Technology (IT) administrators to manage access rights and separate personal from corporate data in-vehicle, applying the same compliance standards used for smartphones. In parallel, Cerence revealed its Mobile Work AI Agent at IAA MOBILITY 2025, integrating 365 Copilot into its xUI platform for multi-Original Equipment Manufacturer (OEM) deployment. The system prioritizes safety with voice-first controls that let users access Teams, Outlook, and OneNote without looking away from the road. Rather than reframing travel as active work time, the goal is to reduce smartphone distractions and support productivity during the commute as desired.

Mercedes and Microsoft’s collaboration, alongside Cerence’s Mobile Work Agent, highlights how connected productivity is emerging as a new area of differentiation in premium segments. This evolution builds on traditional infotainment experiences by adding a functional, work-oriented layer that expands what drivers and passengers can do inside the vehicle.

For Mercedes, full control of MB.OS enables deeper and more secure integration of enterprise software. For Microsoft, expanding 365 Copilot into vehicles opens a new growth channel and positions the company as a core player in automotive software, competing directly with Google and Apple. Cerence provides an alternative path for OEMs that prefer not to work directly with hyperscalers, giving them access to enterprise copilots without surrendering control of their data or user experience. Together, these initiatives show how vehicles are evolving into reconfigurable environments that can shift between comfort, entertainment, and productivity, reinforcing the long-standing idea of the car as a “third space.”

Additionally, many advanced in-car features, such as automated parking or lane assist, are marketed as innovative without clearly delivering everyday value. Large Language Model (LLM)-based agents could change that by simplifying complex actions through natural conversation and delivering a more intuitive, rewarding experience. With more efficient productivity tools, consumers will have greater incentive to pay for Artificial Intelligence (AI)-powered content, creating a much-needed path for OEMs to monetize in-vehicle intelligence.

AI-driven productivity tools represent a meaningful next step in how automakers design and differentiate software-defined vehicles. Automakers, suppliers, and technology partners should treat this as a long-term opportunity to evolve in-cabin experiences that combine safety, personalization, and utility.

• Automakers: The key is balancing convenience with responsibility. Productivity features should complement driving behavior, not compete with it. OEMs with proprietary software platforms such as MB.OS or BMW's Neue Klasse are best equipped to integrate AI copilots securely, monetize them through partnerships, and maintain control over user data.
• AI and Software Suppliers: Cerence's agent demonstrates how work-oriented copilots can effectively scale across brands. Continued collaboration with hyperscalers like Microsoft, Cisco, and Zoom could help establish shared frameworks that maintain consistency while minimizing driver distraction.

These AI work agents should remain optional, designed for flexibility and user choice. Drivers who prefer to stay productive can handle light, low-cognitive tasks such as summarizing emails or preparing notes during idle or low-demand driving, giving them back valuable time elsewhere in the day.

Consumers are already using copilots and chatbots on their phones to manage tasks, making the extension of this behavior into vehicles a natural progression. A dedicated, work-centered agent can deliver the same support in a format designed for in-vehicle safety and minimal distraction. Adoption is likely to be gradual, but the behavioral groundwork is already in place as drivers grow more comfortable engaging with embedded AI systems during transit.