[FRANKFURT] Mercedes-Benz Group’s China sales tumbled 27 per cent in the third quarter to their lowest level in almost a decade as luxury demand in the country remains weak and local manufacturers dominate on electric vehicles.
The slump in China – the worst quarterly sales performance there since 2016 – dragged down the company’s global shipments, which fell 12 per cent in the period. Deliveries also dropped 17 per cent in the US, where President Donald Trump’s shifting stance on tariffs weighed on imports.
Mercedes and its German peers are losing ground in China to homegrown rivals such as BYD and Xiaomi, whose feature-packed EVs are undercutting them on price. BMW and Porsche are also contending with weak sales in the world’s largest auto market, where fierce competition is eroding sticker prices and squeezing profit margins.
Mercedes shares declined as much as 2.5 per cent in Frankfurt. The stock is still up roughly 2 per cent this year.
The slack demand for luxury EVs is hitting automakers already dealing with muted growth in Europe and duties in the US. Several of them have corrected course by cutting costs or shifting funds back into combustion-engine and hybrid models.
Ferrari believes it can buck the trend with its first fully electric model, which the Italian company will start to unveil this week.
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While robust demand for Mercedes’s electric CLA sedan drove a 22 per cent quarter-on-quarter global increase in sales of the company’s EVs, their shipments remained flat over the same period last year.
The manufacturer’s pricier EQS and EQE electric sedans have largely flopped, raising questions about the viability of chief executive officer Ola Källenius’ strategy to push Mercedes further upmarket for the electric age.
Mercedes’ third-quarter car sales in China slumped to 125,100, the company’s lowest tally since the second quarter of 2016, according too data compiled by Bloomberg. At the time, a slowdown in the Chinese economy and shifting tastes dented demand for luxury sedans.
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Since early 2023, Mercedes has based these figures on wholesale shipments to dealers rather than retail deliveries to customers, aligning the data with its financial disclosures. A company spokesman declined to comment on the most recent China sales figure and the historical comparison.
Mercedes-Benz Vans sold 83,800 vehicles in the third quarter, down 8 per cent from a year earlier, though electric vans were a bright spot. Their sales almost doubled to 8,600 units. BLOOMBERG
