{"id":668263,"date":"2026-10-28T23:02:10","date_gmt":"2026-10-28T23:02:10","guid":{"rendered":"https:\/\/www.newsbeep.com\/ie\/668263\/"},"modified":"2026-10-28T23:02:10","modified_gmt":"2026-10-28T23:02:10","slug":"mercedes-bets-on-model-blitz-as-china-slump-deepens-the-irish-times","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ie\/668263\/","title":{"rendered":"Mercedes bets on model blitz as China slump deepens \u2013 The Irish Times"},"content":{"rendered":"

Mercedes-Benz Group <\/a>is pushing ahead with its biggest product and cost overhaul in years, betting it can restore profitability even as China <\/a>turns from a growth engine into one of the biggest drags on the business.<\/p>\n

Third-quarter revenue at the German carmaker fell 4.5 per cent to \u20ac30.7 billion, while adjusted group earnings before interest and tax declined 15 per cent, the group said on Wednesday. <\/p>\n

The results came a day after Mercedes lowered its outlook, citing cost pressures and a drop in sales in the mainland.<\/p>\n

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Chief executive Ola K\u00e4llenius pointed to continued growth in Europe and the US as well as record electric-vehicle sales, as evidence that newer models are gaining traction. At the same time, he said market conditions had become \u201ceven more challenging\u201d, particularly in China.<\/p>\n

At its core cars division, adjusted earnings more than halved to \u20ac560 million in the third quarter, and the margin narrowed to 2.5 per cent from 4.8 per cent, reflecting the weaker contribution from China, as well as currency and product-launch costs.<\/p>\n

Mercedes is counting on further product launches and lower costs to rebuild profitability, while stopping short in its statement of giving a timetable for a recovery in margins.<\/p>\n

On Tuesday, Mercedes had said it was downgrading its outlook due to a deepening downturn in China and higher fourth-quarter costs, including more expensive materials. That triggered a 3.9 per cent slide in the shares, and brought the year-to-date loss to 34 per cent.<\/p>\n

China has become the biggest obstacle to K\u00e4llenius\u2019s attempt to rebuild profitability. Mercedes vehicle sales there fell 31 per cent in the third quarter from a year earlier, extending a decline driven by weaker luxury demand, fierce price competition and increasingly sophisticated domestic rivals.<\/p>\n

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The pressure extends across Germany\u2019s auto industry. BMW and Volkswagen have also warned that deteriorating conditions in China are hurting earnings, highlighting how quickly a market that once generated outsize profits has become one of the sector\u2019s biggest structural problems.<\/p>\n

Volvo chief executive H\u00e5kan Samuelsson said last week that the market for western-developed cars in China isn\u2019t coming back.<\/p>\n

For Mercedes, the reversal strikes at the heart of a strategy K\u00e4llenius has pursued for years: selling fewer cars while concentrating on expensive models capable of generating higher margins. The S-class, Maybach, G-Class and AMG range have been central to that push, but the deterioration of China\u2019s luxury-car market has made the equation increasingly difficult.<\/p>\n

Mercedes is responding with cost cuts, including an effort to save about 8 per cent on materials versus 2024 levels, with even steeper targets in China.<\/p>\n

K\u00e4llenius is also shrinking an industrial footprint built for stronger volumes, as the company\u2019s global passenger-car capacity declines. Voluntary redundancy programmes are being used to reduce the German workforce.<\/p>\n

The other leg of the recovery plan is Mercedes\u2019s biggest-ever product offensive. More than 40 new or refreshed models are due by the end of 2027. The electric CLA and GLC are already being rolled out, with new versions of the C-Class, S-class, GLE and GLS among the models intended to rebuild demand.<\/p>\n

China is a key part of that offensive. Mercedes has accelerated local development and sourcing, while targeting sharply lower costs in the country. New China-specific vehicles include long-wheelbase versions of models such as the electric GLC. \u2013 Bloomberg<\/p>\n","protected":false},"excerpt":{"rendered":"Mercedes-Benz Group is pushing ahead with its biggest product and cost overhaul in years, betting it can restore…\n","protected":false},"author":2,"featured_media":668264,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[18041,72,114,61,60,18039,18043],"class_list":["post-668263","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-bmw","tag-business","tag-china","tag-ie","tag-ireland","tag-mercedes-benz","tag-volkswagen-vw"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/668263","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=668263"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/668263\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/668264"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=668263"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=668263"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=668263"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}