Mercedes Suffers Down Q1 on Plunging China Sales
By Reuters | 09 Apr, 2026

Mercedes-Benz sales slump to start 2026 is due to a 27% plunge in China where the luxury carmaker is overhauling its model lineup.

Mercedes-Benz reported a sales slump at the start of 2026 as the tough Chinese market continued to pressure the German premium carmaker during an overhaul of its model lineup to regain lost ground.

First-quarter sales in the company's core car business fell 6% to 419,400 vehicles globally from the same period a year ago, it said in a statement on Thursday.

While sales volumes grew by 7% in Europe and 20% in the United States, this was not enough to offset a 27% plunge in China, where both Mercedes and its rival BMW face a cut-throat price war with local brands in the premium segment.

Mercedes said 2026 would be a "transition year" for the brand in China, the world's biggest auto market, with the decline partly driven by the phase-out of models in its entry segment ahead of the launch of new models.

While the China slump widened in the first three months of 2026, the Stuttgart-based carmaker rebounded in the U.S. with wholesale growth following a 19% drop in the fourth quarter, having stocked up its dealer network for the coming months.

"Going forward, the company will place even greater focus on the localisation of products and value creation in this region," the company said of the U.S. market, where steep import tariffs have hurt demand.

(Reporting by Rachel More and Amir OrusovEditing by Ludwig Burger)