"The daily hunt for a parking space often takes up as much time again as the actual journey," the Mercedes-Benz maker said in a statement, causing "stress and annoyance".
Daimler will work with Bosch -- the world's largest auto- parts maker -- on the scheme dubbed "community-based parking" in its home city of Stuttgart, capital of southwestern Baden-Wuerttemberg state.
During the project, set to begin "imminently", participating cars will use built-in ultrasound sensors to scan the roadside while travelling at speeds of up to 55 kilometres per hour.
One technical challenge will be identifying which gaps in the roadside are genuine parking spaces and which are exits from parking garages.
But with enough cars travelling down the same street, spaces that are repeatedly registered as empty can be identified as likely exits, Daimler explained.
The first iteration of the technology will simply provide drivers information about the probability of finding a parking space on a particular street.
With a larger base of users in the future, it will be possible to display available parking spaces in real time on a dashboard map or in the carmaker's smartphone app, Daimler said.
Disclaimer: No Business Standard Journalist was involved in creation of this content
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