Mercedes-Benz is backtracking on its EV plans as the luxury automaker plans to continue building gas-powered cars “well into the 2030s.”
Mercedes backtracks on EV-only commitment by 2030
Mercedes announced plans to go all-electric by the end of the decade in 2021, “where market conditions allow.”
The luxury automaker said all newly launched vehicle architectures will be electric-only from 2025 onwards. Mercedes already offers an EV in every segment with the sedan and SUV versions of the EQS and EQE models and the EQB electric SUV.
However, Mercedes announced Thursday it’s backtracking on its EV commitment with plans to produce gas-powered vehicles well into the next decade.
Mercedes-Benz now expects electrified vehicles (including hybrids) to represent 50% of total sales in 2030, drastically lower than the 100% commitment from 2021.
After the automaker’s net profits slipped 21% in Q4, Mercedes is slowing its transition. Mercedes says it “will be able to cater to different customer needs well into the 2030s.”
Mercedes saw fourth-quarter revenue slip in major regions, including the US (-7.4%) and Germany (-2.8%).
Although full-year revenue was up 2.1% to $153.2 billion, operating profits slipped 4% in 2023 to $19.7 billion.
Despite this, electrified vehicles (including hybrids) accounted for 21.8% of sales in Q4, with a 19.7% share in 2023. Mercedes said it expects EVs and hybrids to represent 19% to 21% of vehicle sales this year.
All-electric vehicle sales increased 61.3% in 2023 to 240,668, while PHEV sales slipped 12.5%. Mercedes-Benz vans saw 7.8% sales growth last year, with electrified vehicles accounting for 5.1%.
Top comment by M.E.
While Hyundai says it can't build evs quickly enough because they sell like hot cakes, Volvo sees no slowing market for evs, other legacy automakers seem to slow down.
Imo the reason is very likely that they can't make as much profit on evs as they can on gas cars yet, because cars need to be produced in large quantaties to lower costs, thus improve profit.
Ford took the risk and went all in, but wre stopped in their tracks by the high FED rates and UAW demands.
Given the above, I think we will see a pick up of demand after the FED lowers it's rates. And after ev prices have come down a bit. In the meantime, Chinese ev automakers will steam ahead at full speed.
Mercedes joins American automakers Ford and GM, which also recently pushed back EV initiatives.
The automaker cited higher inflation, supply chain costs, and expenses for future tech and vehicles for lower gross profits.
Mercedes still expects its next-gen EVs to make a big impact, with a roughly 30% cost reduction. The automaker said entry-level EVs based on its upcoming MMA, like the electric CLA, will have around 466 mi (750 km) WLTP range. They will also be able to gain up to 250 mi (400 km) with 15-minute fast charging.
Source: Reuters, Mercedes-Benz
FTC: We use income earning auto affiliate links. More.
Comments