Mercedes-Benz Q2 Sales in China Plunge by 30% Amid Major Profit Warning

[Market Update] Mercedes-Benz's sales in China dropped 30% year-over-year in Q2, putting pressure on its global financial results.

Core Development: China-Related Impairment Severely Hits Profits

A one-time impairment charge of €7.52 billion caused Mercedes-Benz Cars' EBIT to plummet from €7.83 billion in the same period last year to just €0.49 billion, driving the sales margin down from 3.2% to 0.2%.

Key Metrics: Double Decline in Sales and Cash Flow

China sales in Q2 2026 totaled only 98,600 units, a 30% year-over-year decline; industrial free cash flow for the first half of the year stood at €29.6 billion, also down 30% year-over-year. Production of the Beijing Benz C-Class fell by 41%, and GLC production declined by 25%.

Strategic Context: Model Transition Meets Intensifying Competition

Mercedes-Benz attributed the downturn to fierce competition in the Chinese market, cautious consumer sentiment, and its current model transition phase, and plans to launch an intensive wave of new products in the second half of the year to reverse the trend.