Mercedes-Benz Cuts 2026 Profit Outlook as China Sales Slump, Shares Fall 4%

Mercedes-Benz lowered its full-year 2026 outlook on Tuesday, becoming the third major German automaker to do so, citing weak Chinese demand and rising material costs. The company now expects core profit to stay flat at about €5.8 billion, scrapping an earlier forecast of at least 15% growth, and cut its core car-business margin target to 2%-3% from 3%-5%. Preliminary third-quarter core profit came in at €1.77 billion with a 2.5% margin in the car division; full results are due Wednesday. Mercedes shares fell more than 4% on the announcement, while Volkswagen and BMW each dropped about 2%. Both rivals have already trimmed their own guidance. Mercedes' China deliveries fell 29% in the first nine months of 2026, compounding pressure from BYD and Xiaomi. CEO Ola Kallenius has asked German staff to work extra hours without added pay and is shifting output to Hungary, where he says costs run roughly 70% lower.