The century-old automotive giant Mercedes-Benz is currently going through an unprecedented “darkest moment.” The latest financial report shows that its net profit in the second quarter plummeted by nearly 69% compared to the same period last year, with sales continuing to decline, especially in its largest single market – China, where the decline reached 14%. Faced with the dilemma of “volume and price double threat,” this long-established luxury car company is struggling to save itself.
Mercedes-Benz Group’s financial report for the second quarter of 2025, recently released, reveals concerning financial figures. During the reporting period, the group’s revenue was 33.153 billion euros, a 9.8% decrease year-on-year; even more severe is that net profit was only 957 million euros, a significant drop of 68.7% compared to the 3.062 billion euros from the same period last year.
With revenue not increasing, Mercedes-Benz’s sales are also showing a downward trend. Global sales in the first half of the year were approximately 1.0763 million vehicles, an 8% decrease compared to the previous year.
As the largest single market for Mercedes-Benz globally, the performance of the brand in China is particularly weak, with cumulative sales in the first half of the year reaching only 293,200 vehicles, a 14% decrease compared to the same period last year, making it the market with the highest decline globally. In the second quarter, Mercedes-Benz’s sales in the Chinese market decreased by 19% year-on-year to 140,400 vehicles.
This “double blow of volume and price” reflects the systematic pressure Mercedes-Benz is facing during the industry’s transformation period. Especially in the highly anticipated new energy field, Mercedes-Benz’s delivery of pure electric vehicles in the first half of the year was 87,300 vehicles, a 14% decrease compared to the previous year, far behind main competitors BMW and Audi. The decision by Mercedes-Benz’s top management to publicly announce that the EQ series will no longer operate independently has also been widely interpreted by the market as a signal of failure in their new energy strategy.
Facing the monumental shifts in the market, Mercedes-Benz has embarked on a difficult path to self-rescue. Since last year, the company has initiated a price war, with almost all models from entry-level to top-of-the-line receiving significant price reductions, with discounts of up to 15%. According to “Car King” information, the selling price of certain models such as the EQB 260 has dropped from a retail price of 352,000 yuan to a starting price of 202,000 yuan, a significant decrease.
Simultaneously with the price reduction, Mercedes-Benz has initiated actions to “optimize” its dealer network in China. In recent times, several Mercedes-Benz owners have complained on social media about receiving “breakup notices” from 4S dealerships: the stores have been terminated by Mercedes-Benz officially.
This is not an isolated incident for individual stores; according to statistics, many dealerships such as Beijing Penglong Ruixing, Beijing Penglong Hai Yijie, Beijing Yuntong Xingchi, Dezhou Guanghui Zhexing, Huzhou Zhexing, Shaoxing Zhexing, Dongying Wuyue, and others are included in this “breakup list.”
In addition, news of layoffs in Mercedes-Benz China has also surfaced.
In March this year, there were reports that Mercedes-Benz China was in discussions with some employees, mainly involving the sales and automotive finance systems. While the official statement mentioned strict adherence to laws and regulations, this round of adjustments undoubtedly brought enormous uncertainty to employees and dealers.
Mercedes-Benz’s series of “survival measures” have not yet reversed the declining trend. Regardless of whether Mercedes-Benz is willing to acknowledge it, the landscape of the luxury car market in China has already ushered in a disruptive transformation. Their once solid profit stronghold and “comfort zone” are now facing fierce competition from domestic new forces.