Mercedes-Benz Group
German maker of premium and luxury cars including Mercedes-Maybach, AMG, and S-Class.
On the record
Checkpoint: Q3/Q4 2026 China delivery figures and Maybach vs Maextro share data
The call
Mercedes still sells cars the world trusts, but its most profitable China customers are switching to Huawei-backed rivals faster than cost cuts can offset it.
Mercedes-Benz makes high-end cars and has a famous brand that people pay extra for, plus its own dealerships and financing company. But Chinese car makers like Huawei-Seres are now selling fancy electric cars that steal Mercedes customers in China, especially for super-luxury models like the Maybach. The company's profits dropped 40% and sales fell 9%, factories are laying off thousands of workers, and the company just stopped some of its big plans for self-driving cars and electric-only cars. The one thing that could save the stock is if sales in China stop falling so hard in the last few months of 2026 and Chinese brands stop expanding into other car types, but right now that is not happening.
Why
01
AI pressure: Huawei-Seres Maextro and other AI-loaded Chinese EV cockpits. Huawei's software and AI cabin tech in the Maextro S800 now outsell Maybach S-Class in China, hitting Mercedes where it makes most money. Could AI do the core job? Only partly.
02
Bigger players: Huawei-Seres, BYD, NIO, AITO (Chinese premium EV makers). Chinese rivals are taking Mercedes's top-end China buyers now, not someday, while China deliveries fall 30% in a single quarter. Could a giant copy it? Probably.
03
What protects it. A century of brand trust, a global dealer and financing network, and buyers who still pay up for the three-pointed star badge outside China.
What would change this call
China deliveries year-over-year change in Q3 and Q4 2026 reports. Shows whether the 30% China decline is narrowing or worsening.
Maextro S800 and other Chinese EV sales rankings vs Maybach/S-Class in China. Shows whether Chinese rivals keep expanding beyond the ultra-luxury segment.
Q2 2026 earnings call (28 July 2026) commentary on Top-End segment share and EV strategy reversal. Shows whether management sees China losses stabilizing or deepening.
Maextro S800 and other Chinese EV sales rankings vs Maybach/S-Class in China. Shows whether Chinese rivals keep expanding beyond the ultra-luxury segment.
Q2 2026 earnings call (28 July 2026) commentary on Top-End segment share and EV strategy reversal. Shows whether management sees China losses stabilizing or deepening.
Key numbers
- China deliveries down 30% in Q2 2026
- Adjusted EBIT fell to €8.2bn from €13.7bn
- Maextro S800 now outsells Maybach S-Class in China
Named risks
- China ultra-luxury and overall deliveries collapsing (down 30% Q2 2026), eroding most profitable segment.
- US Slotkin-Moreno bill could ban connected-vehicle sales over 15% Chinese ownership by 2030; Mercedes at ~20%.
- Labor unrest: 33,000+ employees protested cost cuts on July 3, 2026 amid ongoing restructuring.
- Strategic whiplash on EV strategy (abandoning Electric Only by 2030) may cause capex and product-plan disruption.
- Ceded proprietary in-car AI to Google Gemini rather than owning the software layer.
Rivals, as read in July 2026
| Rival | Direction | Evidence |
|---|---|---|
| Huawei-Seres (Maextro) | losing to | Maextro S800 outsold Mercedes-Maybach S-Class in China as of May 13, 2026 |
| BYD | losing to | China luxury segment eroded amid Mercedes China deliveries down 19% in 2025 |
| NIO/AITO | losing to | Chinese premium EV makers taking share as Mercedes China deliveries fell 27% in Q1 2026 |
| BMW | gaining on | BMW US sales rose 4.7% in H1 2026 vs Mercedes' 3.5% decline, per July 13, 2026 report |
| Tesla | contesting | Tesla holds EV/software and robotaxi leadership as Mercedes recalibrates its EV strategy, July 2026 |
Questions people ask
- Is Mercedes-Benz Group profitable in 2026?
- Yes but shrinking fast. FY2025 adjusted EBIT fell to €8.2 billion from €13.7 billion in 2024, and Q1 2026 EBIT dropped 17% to €1.9 billion on revenue of €31.6 billion, down 5% year over year, as of April 30, 2026.
- Is Mercedes-Benz losing market share in China?
- Yes. China deliveries fell 19% in 2025, then 27% in Q1 2026 and 30% in Q2 2026, and Huawei-Seres' Maextro S800 now outsells the Mercedes-Maybach S-Class in China as of May 13, 2026.
- Could AI replace Mercedes-Benz's core business?
- No, manufacturing and brand are AI-immune, but Mercedes ceded in-car AI to Google Gemini (rollout began January 2025) rather than owning the software layer, and is deploying n8n workflow automation across staff toward a ~70% AI-adoption goal as of June 2026.
- Who is Mercedes-Benz's biggest competitor?
- In its most profitable segment, Chinese rival Huawei-Seres' Maextro S800 outsold the Mercedes-Maybach S-Class and BMW 7-Series in China as of May 13, 2026, alongside BYD and NIO eroding share; traditional peers include BMW and Audi.
- Did Mercedes-Benz abandon its electric vehicle strategy?
- Largely yes. An executive called the EV pivot a 'catastrophe' and the company dropped its 'Electric Only by 2030' ambition for a technology-neutral hybrid/ICE approach as reported July 18, 2026, though electric GLC/C-Class rollouts continue in some markets.
- Why did Mercedes-Benz pause Level 3 self-driving?
- Mercedes paused its Drive Pilot Level 3 hands-off system on the refreshed S-Class/EQS in January 2026, citing high cost and low customer uptake, replacing it with a Level 2++ system called MB.Drive Assist Pro developed with Nvidia.
Timeline
- 2026-07-20Mercedes lobbies to raise US bill's Chinese-ownership threshold from 15% to 25% amid ~20% Chinese ownership
- 2026-07-18Executive calls EV pivot a 'catastrophe'; Electric Only by 2030 strategy abandoned
- 2026-07-08Q2 2026 global deliveries fall 8% to 417,800 units; China deliveries down 30%
- 2026-07-03Over 33,000 employees protest nationwide against cost cuts
- 2026-06-01Share buyback tranche completed: 37.6 million shares repurchased for ~€2.0 billion
- 2026-05-21Mercedes closes 28-year-old Long Beach, CA design hub, ~72 direct job losses
- 2026-05-13Maextro S800 confirmed outselling Mercedes-Maybach S-Class in China
- 2026-04-30Q1 2026 results: revenue €31.6bn (down 5%), EBIT down 17% to €1.9bn
- 2026-02-11FY2025 results: revenue €132.2bn (down 9.2%), adjusted EBIT €8.2bn (down from €13.7bn)
- 2026-01-19Mercedes pauses Level 3 Drive Pilot on refreshed S-Class/EQS
Revision history
20 July 2026
First assessed. Losing its protection. The text above is fixed as of this date and is not edited afterwards.
In the same band
Sources
- Solid Cash Generation and Shareholder Returns in 2025 (2026-02-11)
- Mercedes-Benz Q2 2026 sales fall as China slump deepens (2026-07-08)
- Maextro S800 continues China's ultra-luxury sedan dominance (2026-05-13)
- Mercedes-Benz Group AG (ETR)
- Mercedes Is Literally Paying People Half a Million Euros Just to Quit (2025-11-06)
- Work more for the same money (2026-07-08)
- Annual Reports 2025 (2026-02-12)
- Mercedes is hitting pause on Level 3 hands-off driving (2026-01-19)
- Mercedes Executive Calls Company Electric Vehicles a Disaster (2026-07-18)
- Mercedes-Benz Group Share buyback 2025-2026 (2026-06-04)
- Mercedes Looks to Soften Bill to Ban Automakers With China Ties (2026-07-20)
- Mercedes-Benz and Google Partner on AI-powered Conversational Search (2025-01-13)