Mercedes-Benz shares slipped on Wednesday after the German automaker reported a 6% decline in global sales for the third quarter of 2026, with weakness in China outweighing record electric vehicle sales and growth in Europe and North America.
The Stuttgart-based company sold 491,700 cars and vans in the July-to-September period, down from a year earlier. Shares fell as much as 4% in early trading before recovering some ground.
China, Mercedes' largest single market, continued to be a drag. Sales there plunged 31% year-on-year, with the company citing intense competition and challenging market conditions. In the second quarter, Chinese sales had already fallen 30%. The GLC and E-Class models accounted for nearly two-thirds of Mercedes-Benz Cars sales in China, but overall demand remained weak.
Excluding China, group sales rose 2%, and car sales alone increased 1%. "Outside China, car sales increased for the third consecutive quarter in 2026," said Mathias Geisen, the board member responsible for sales and customer experience.
Record electric vehicle sales
Despite the overall decline, Mercedes posted its best-ever quarter for battery-electric vehicles (BEVs). Global BEV sales jumped 61% year-on-year to 68,400 units, up 29% from the second quarter. Fully electric cars made up a record 16.8% of global car sales, a rise of 7.2 percentage points from a year earlier.
In Europe, BEV sales reached a quarterly record, up 78% year-on-year and 24% compared with the previous quarter. Geisen noted that the new electric GLC, CLA, GLB and GLA models are "sold out in Europe for the rest of the year, with order books extending into 2027." To meet demand, Mercedes is running three-shift schedules at its plants in Bremen and Rastatt in Germany, and Kecskemét in Hungary.
European car sales overall rose 5% to 168,700 vehicles, driven by a 13% increase in Germany and a 7% rise in the UK. In North America, sales grew 4% to 83,200 units, with US sales up 6%.
The company's performance in China remains a concern. In July, Mercedes cut its full-year car sales and group revenue forecasts, citing weaker demand and a tougher competitive landscape. China still accounted for nearly a quarter of global car sales in the second quarter, underscoring its importance.
For the first nine months of 2026, Mercedes sold 1,244,400 cars, down 7% from the same period last year, while fully electric car sales rose 40% to 165,500 units.
The results come as European automakers face mounting pressure from Chinese competitors and shifting consumer preferences. The push by France and Germany for new EU powers to counter China's trade practices reflects the broader challenge. Meanwhile, the global economic outlook remains uncertain, with the IMF signaling a return to austerity as debt levels climb.
Mercedes' experience in China is a stark reminder of the competitive pressures in the world's largest auto market. While the company's electric push is gaining traction in Europe, the road ahead in Asia remains bumpy.
