2026-10-27
Mercedes-Benz Cuts 2026 Car Margin Outlook on China Weakness, Higher Costs
Oct 27 (Reuters) - Mercedes-Benz (MBGn.DE) on Tuesday cut its profit margin outlook for 2026 for its core cars division, citing increasingly challenging market environment in China and higher costs in the fourth quarter.
Its shares were down 5.3% as of 0911 GMT, on track for their biggest intra-day drop since May 2025.
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The German premium automaker now expects an adjusted return on sales of 2%-3% in 2026, down from its previous guidance of 3% to 5%.
The company also cut its 2026 group operating profit guidance, now expecting earnings to be broadly flat year-on-year rather than significantly higher.
Mercedes' core car sales fell 8% year-on-year in the third quarter, weighed down by weak demand in China.
German carmakers have continued to report declining sales in China, while Chinese rivals are gaining ground in Europe, using competitive pricing and advanced EV technology to expand in a market long dominated by Western brands.
Reporting by Amir Orusov, editing by Anna Pruchnicka
Source: Reuters