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Mercedes-Benz Profit Halves in 2025 as Tariffs and China Slump Force Strategy Reset

The company guides for roughly flat 2026 revenue with a materially higher operating result.

Overview

  • Mercedes reported consolidated profit of €5.3 billion, revenue of €132.2 billion (down 9%), and EBIT of €5.82 billion (down 57%) for 2025.
  • Management cited elevated US import tariffs (about a €1 billion hit), adverse currency effects, and fiercer competition in China, where car sales fell 19% as global deliveries slid to about 2.16 million vehicles.
  • Mercedes is accelerating a product offensive exceeding 40 new or updated models by 2027, keeping an A‑Class successor in the lineup and preparing multiple near‑term premieres, including an electric C‑Class.
  • Cost actions delivered more than €3.5 billion in savings in 2025, with additional targets through 2027 to reduce production and fixed costs by around 10% and to localize more development and manufacturing in China and expand lower‑cost capacity in Hungary.
  • Shareholders are set to receive a reduced €3.50 dividend per share and eligible employees a bonus of up to €3,139, while sector peers such as Ford also reported heavy EV-related losses, highlighting broader industry pressures.