Mercedes-Benz Stock: Shares Rally Despite EV Sales Decline

Mercedes-Benz shares demonstrated remarkable resilience on Friday, climbing 2.75% to reach €54.52 and securing the top position among DAX performers. This positive movement comes as a surprising development, considering the company's overall vehicle deliveries dropped by 4% to approximately 2.4 million units in the previous year. The German luxury automaker faced particular challenges in China, where sales declined by 7% amid intensifying competition from domestic manufacturers, though the fourth quarter showed signs of improvement with a modest 3% increase compared to the same period last year.

Electric Vehicle Challenges

The company's electric vehicle segment experienced significant headwinds, with battery-electric vehicle deliveries falling by 22% to 204,600 units over the past year. This downward trend intensified in the fourth quarter, recording a 26% decrease. Adding to these challenges, the planned production launch of the electric CLA long-wheelbase version for the Chinese market has been postponed from the first to the second half of 2025 due to software-related issues. Industry analysts are now closely monitoring the company's profitability metrics, with expectations of an automotive business profit margin between six and eight percent, viewed as crucial for maintaining competitive edge in the market.