German car maker Daimler wants to cut spending on IT services by 150 million euros ($198.31 million) each year by the end of 2016, the company's technology chief, Wilfried Porth, told German weekly Automobilwoche.

Struggling to match rivals' scale and efficiency in smaller cars, as well as their success in China, Stuttgart-based Daimler has fallen further behind German peers BMW and Volkswagen .

Daimler wants to cut annual costs by 2 billion euros for its Mercedes-Benz division by the end of 2014, and is aiming for the bulk of the cost cuts this year.

Porth told the magazine Daimler was on track to reach the target. The company will take back the IT systems it had outsourced to SAP as part of the plan.

Separately German weekly Focus reported on Sunday that an internal Daimler study showed its Mercedes-Benz plants in Germany were less efficient than its plants outside the country.

Daimler declined to comment on the report. ($1 = 0.7564 euros)

(Reporting by Harro ten Wolde and Christiaan Hetzner; Editing by Louise Heavens)