Mercedes-Benz to accelerate localisation as China revenue slump hits 2025 profits
Despite a weak outlook, the company unveils a strategy to further localise production in China, introduce AI-based upgrades and launch new models
Chinese market sales “will remain below 2025 [levels]” this year, said Mercedes China chief Oliver Thoene, as the group reported a 19 per cent decline in its China sales and a 28.6 per cent overall drop in revenue for last year.
At the group level, the company said operating profit more than halved to €5.8 billion (US$6.9 billion) in 2025, marred by €1 billion in tariff costs, challenges in the cutthroat China market and the negative impact of currency fluctuations.
Despite the weak outlook, the company unveiled its strategy to further localise production in China, introduce artificial intelligence-based upgrades and launch new models in the hope of winning back Chinese customers.
“China will remain the single most important market for Mercedes,” Thoene said on Thursday.
The Mercedes voice assistant, powered by ByteDance’s Doubao AI model, was installed on one model but would be rolled out to other models, as would its assisted driving function, co-developed with Chinese self-driving firm Momenta, Thoene said.