(Story deletes original para 4, corrected at source, Automobilwoche says Scheunert was not chief digital officer of PSA group before her China assignment.)

FRANKFURT (Reuters) - Carmaker Daimler <DAIGn.DE> has hired the head of China operations of rival Citroen <PEUP.PA> to set up a new digitalization unit at its Mercedes-Benz brand, Automobilwoche magazine will report on Monday.

The German carmaker is to launch the unit on August 1 under Sabine Scheunert, who it hired on July 1, according to pre-publication extracts released by the magazine.

With future generations of cars needing to be equipped with the technology to connect electric motors to batteries, talk to smartphones or activate brakes when a radar system detects an obstacle, software - or digital - expertise has become a new battleground for manufacturers.

Daimler was not immediately contactable for comment.

(Reporting by Vera Eckert, editing by John Stonestreet and Adrian Croft)