Gia Motors News According to Bloomberg News, Mercedes-Benz lowered its full-year financial forecast due to weak performance in the Chinese market, which is another blow to the troubled German auto industry.
S-Class sedan.
Photo source: Mercedes-Benz, On September 19, Mercedes-Benz said its adjusted profit margin forecast for its main automotive business was lowered to “7.5%-8.5%” from the previous 11%.
Sales of the most expensive models such as the Mercedes-Benz S-Class and Maybach sedan have been hit as demand in the company’s largest market, China, cools further.
Meanwhile, Mercedes-Benz said its earnings before interest and tax (EBIT) this year are expected to be “significantly lower” than last year’s level.
This caused a major setback to the company’s strategy of increasing profitability by selling more luxury models.
, Mercedes-Benz CEO Ola Källenius said on an analyst conference call that Mercedes-Benz would “do everything it can” to improve performance, including launching new products in the Chinese market to launch a sales offensive.
“We will ride the wind and waves, not just wait for the wind direction to change.
“, After the report was released, Mercedes-Benz’s share price fell 7.
7% on September 20, the largest intraday decline since May last year.
Since the beginning of this year, the stock’s share price has fallen by about 13%.
, Mercedes-Benz’s latest electric car has received lackluster response among Chinese consumers, as young Chinese consumers increasingly turn to local brands with more advanced in-vehicle digitalization and entertainment technology.
, Not only is Mercedes-Benz’s business declining in the Chinese market, but its sales in the European market are also under pressure.
In August this year, Mercedes-Benz’s deliveries across Europe fell 13% year-on-year, while cumulative sales in the first eight months fell 3% year-on-year.
, Falling sales of electric vehicles are hampering carmakers ‘efforts to meet EU carbon emissions rules that will be tightened next year, which could expose the industry to billions of euros in fines.
The profit warning is the latest setback facing Germany’s most important auto industry.
Currently, the German automobile industry is struggling to cope with the bumpy transition to electric vehicles and the dilemma of declining profits in China.
This month, Volkswagen Group, Europe’s largest carmaker, scrapped a decades-old labor agreement.
At the same time, Volkswagen Group is also considering closing its German factory for the first time due to lagging demand.
In addition, last week, BMW Group also lowered its full-year profit margin forecast due to the sluggish Chinese auto market and weak electric vehicle sales.
German Economy Minister Robert Habeck will hold an automotive industry summit in Berlin next Monday (September 30) to discuss ways to escape the current crisis.
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