German auto giant revises forecast downward due to problems in the Chinese market
The German automotive group Mercedes-Benz Group has revised its annual financial forecast downward. This decision was prompted by a significant decline in demand for the company’s vehicles in the Chinese market.
The company noted that the slowdown in sales in China—one of its key markets—has negatively impacted its projected full-year revenue.
The company announced that its full-year revenue will be “slightly lower” than previous estimates, which were expected to match last year’s figure of 132.2 billion euros.
The decline is attributed to intense competition from local manufacturers, cautious consumer sentiment, and changes to the model lineup in China.
In the second quarter, Mercedes-Benz sales in China fell by 30% compared to the same period last year, offsetting sales growth in the U.S. and Europe.
Despite this, the company’s operating profit for the second quarter rose from 1.3 billion euros to 1.5 million euros, in line with analysts’ expectations. This was driven by positive results from the light-duty truck division and the financial sector.
Other German automakers are also facing challenges. Last week, Volkswagen revised its forecast downward and expects revenue to fall by up to 3%. BMW, in turn, has also lowered its profit expectations due to problems in China and the impact of the war in Iran, prompting the company to accelerate cost-cutting measures and plan to cut thousands of jobs.
This was reported with reference to data from the Financial Times.
