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A new way to use an iPhone in the car

Tech titans are fighting hard to get their technology into your car. Apple just made a big move in that ongoing battle.

The company announced Monday that car makers will begin offering a new technology called CarPlay, which allows consumers to use their iPhones in their cars to make calls, use Maps, listen to music and access messages with their voice or a touch.

It works simply: get in the car, plug in the iPhone 5S, 5C or 5 and then use an 8.4-inch on-board display to use all the information on the iPhone.

(Read more: Apple looks at the car)

"We built this for our customers, for our users," Greg Joswiak, vice president of iPhone, told CNBC. "We don't want their great experiences with their iPhone to end at the moment they get into the car. We want it to get better and better."

Apple is teaming up with Mercedes-Benz, which aims to introduce CarPlay in its C-Class series by the end of this year.

Kal Mos, a senior engineering director at Mercedes-Benz, says the two companies target similar demographics.

"I like what CarPlay is offering today," Mos told CNBC, "and the intuitive way it interacts while driving. We want to offer the best user experience, and that is what Apple is famous for."

Mercedes-Benz would not disclose the price of CarPlay, but Thilo Koslowski, an analyst at Gartner, says car makers could charge up to $1,000 for the system.

Besides Mercedes-Benz, Apple is partnering with a range of car companies including Ferrari, Volvo and, down the road, BMW, Ford, GM, Honda, Hyundai, Jaguar Land Rover, Kia, Mitsubishi, Nissan, PSA Peugeot Citroën, Subaru, Suzuki and Toyota.

Other tech companies are working hard to introduce their technologies into cars as well.Google, for example, has partnered with Audi, GM, Honda and Hyundai to bring its Android platform to those cars this year.

Apple, like all its rivals, wants consumers on its operating system at all times: at work, at home and now in their cars. Mercedes-Benz said they want consumers to think of CarPlay as an "iPhone on wheels."

—By CNBC's Josh Lipton. Follow him on Twitter @CNBCJosh.

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