Photo: Mercedes-Benz
Things are not going well for Mercedes-Benz EVs in China, where local carmakers dominate the market. That’s why Mercedes-Benz considered it appropriate to slash the prices of its electric vehicles in an effort to energize sales.
Mercedes-Benz launched its EQ brand of electric vehicles with great fanfare in 2016 and is now selling eight models in an ever-expanding EV lineup. But despite all efforts, the three-pointed-star carmaker is not doing very well in China, especially in the booming EV market. Faced with lackluster sales, Mercedes-Benz decided to slash the prices of its most expensive models, the EQE, the EQS, and the AMG EQE 53. The move was announced in a statement on its Chinese website, with the measure already in effect since Wednesday.
Also, Mercedes-Benz will compensate customers who recently bought the discounted models at their initial price. The cuts are significant, with the EQE priced at 478,000 yuan ($66,800) Wednesday morning, down from 528,000 yuan ($73,800) a day before. That’s a $7,000 difference, which pales compared to the discount offered on the EQS. The luxury sedan was listed at 956,000 yuan (133,600) on Wednesday, down from 1.19 million yuan ($166,300).
According to people familiar with the company’s plans cited by Bloomberg, Mercedes-Benz is making the cuts because the sales in China have been disappointing. At the time the decision went public, some dealers were already carrying out promotions in a bid to boost lagging sales. According to Bloomberg sources, Mercedes-Benz EQS deliveries in China sometimes dropped to less than 100 units a month.
The Chinese market is dominated by local brands, while foreign and legacy carmakers are falling behind. According to China Passenger Car Association, domestic automakers accounted for almost 80% of EV sales in the first seven months of 2022. Mercedes-Benz, for instance, sold about 8,800 electric vehicles from January through July, including more affordable EQA, EQB, and EQC models. BYD, the largest carmaker in China, sold more than 100,000 EVs in October alone.
Mercedes-Benz is not the only foreign brand forced to slash the prices of its electric vehicles in China. Tesla did the same in October across the lineup, although it explained the move as a gesture to allow Chinese customers to benefit from government incentives.
Also, Mercedes-Benz will compensate customers who recently bought the discounted models at their initial price. The cuts are significant, with the EQE priced at 478,000 yuan ($66,800) Wednesday morning, down from 528,000 yuan ($73,800) a day before. That’s a $7,000 difference, which pales compared to the discount offered on the EQS. The luxury sedan was listed at 956,000 yuan (133,600) on Wednesday, down from 1.19 million yuan ($166,300).
According to people familiar with the company’s plans cited by Bloomberg, Mercedes-Benz is making the cuts because the sales in China have been disappointing. At the time the decision went public, some dealers were already carrying out promotions in a bid to boost lagging sales. According to Bloomberg sources, Mercedes-Benz EQS deliveries in China sometimes dropped to less than 100 units a month.
The Chinese market is dominated by local brands, while foreign and legacy carmakers are falling behind. According to China Passenger Car Association, domestic automakers accounted for almost 80% of EV sales in the first seven months of 2022. Mercedes-Benz, for instance, sold about 8,800 electric vehicles from January through July, including more affordable EQA, EQB, and EQC models. BYD, the largest carmaker in China, sold more than 100,000 EVs in October alone.
Mercedes-Benz is not the only foreign brand forced to slash the prices of its electric vehicles in China. Tesla did the same in October across the lineup, although it explained the move as a gesture to allow Chinese customers to benefit from government incentives.
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