Core Viewpoint - Mercedes-Benz is initiating its largest-ever layoff plan, aiming to cut 30,000 jobs to save €5 billion (approximately ¥41.3 billion) annually, which will be reinvested into the development of 36 new models, including 17 electric vehicles [1][5]. Group 1: Layoff and Cost-Saving Measures - The layoff plan includes attractive severance packages, with some employees eligible for up to €500,000 (approximately ¥4.13 million) in compensation [3]. - The company has already seen 4,000 employees voluntarily leave under this plan, with senior management receiving significant payouts [3]. - This marks the third major restructuring effort by Mercedes in four years, following previous layoffs of 10,000 in 2019 and additional cuts in 2023 [4][5]. Group 2: Sales Decline and Market Challenges - Mercedes reported a 12% year-on-year decline in global sales for Q3, with a staggering 27% drop in the Chinese market [6]. - The sales downturn is attributed to the competitive pressure from new electric vehicle entrants and the need for internal cost optimization [6][7]. Group 3: Shift in Electric Vehicle Strategy - The company initially pursued a "oil-to-electric" strategy with the EQC model, which faced significant market challenges and led to a reassessment of its approach [9][10]. - CEO Ola Källenius has shifted the strategy from "oil-to-electric" to a fully electric model, emphasizing the need for a dedicated electric platform [10][11]. - Despite setbacks with the EQS model, which failed to meet market expectations, Mercedes has ramped up its electric vehicle offerings, achieving a 67% increase in sales for electric models in 2022 [18]. Group 4: Strategic Adjustments and Future Outlook - The company has recognized the challenges of transitioning to electric vehicles and has adjusted its strategy to maintain a dual approach, balancing electric and internal combustion engine models [19]. - The target for electric vehicle sales to account for 50% of total sales has been postponed from 2025 to 2030, reflecting a more cautious approach [19]. - Mercedes is now focused on survival and adapting to market demands, with the understanding that the transition to electric vehicles is a long-term endeavor [20][21].

Core Insights - Mercedes-Benz's global automotive and van sales declined by 9% year-on-year, totaling 547,100 units in Q2 2025, with a significant drop in battery electric vehicle (BEV) sales by 18% to 41,900 units [1][3] - The North American market saw a 14% decrease in sales, while the Chinese market experienced a severe decline of 19%, contributing significantly to the overall performance downturn [1][3] Sales Performance - Total sales for Mercedes-Benz Group in Q2 2025 were 547,100 units, reflecting a 3% increase from Q1 2025 but a 9% decrease compared to Q2 2024 [3] - BEV sales specifically dropped by 8% from Q1 2025 and 18% from Q2 2024, totaling 41,900 units [3] - Sales by segments showed a mixed performance, with the Top-End segment remaining flat at 64,800 units, while the Core segment increased by 4% to 273,800 units [3] Regional Sales Breakdown - In Europe, sales increased by 7% to 159,700 units, with Germany showing a notable 16% rise [3] - Asia's sales decreased by 5% to 189,200 units, with China experiencing a significant 19% drop to 140,400 units [3] - North America saw a 5% increase in sales to 80,600 units, with the U.S. market up by 11% [3] Quality and Trust Issues - Mercedes-Benz faced quality and trust crises, including recalls affecting 16,100 vehicles due to safety hazards related to the fuse box and battery management system [3][4] - The company also dealt with widespread issues in its vehicle navigation systems, impacting several popular models [4] Strategic Adjustments - To address market changes, Mercedes-Benz plans to reduce production costs by 10% by 2027 and is focusing on enhancing its electric vehicle lineup [5] - The company aims to launch new models, including pure electric and plug-in hybrid vehicles, starting in 2025, and plans to introduce several models tailored for the Chinese market [5] - Despite challenges, Mercedes-Benz remains committed to the Chinese market, with plans for additional investments exceeding 14 billion RMB to enhance local product offerings [5]