BMW and Mercedes-Benz See Profits Melt Away in China
The Chinese market has grown so much in the last 10 years that it can no longer be ignored. In the past, if a carmaker did brisk business there, so much the better. Today, for many brands, China as a market is a necessity for companies’ looking to keep a healthy bottom line. That’s even more so at a time when astronomical sums are being invested in electrification.
For BMW and Mercedes-Benz, 2024 is a worrying year for their Chinese operations. Third-quarter sales fell sharply due to falling demand and fierce competition in China itself.
The German automotive sector is facing a number of challenges, from high production costs and managing the transition to electric vehicles, to the decline in demand and growing competition from Chinese manufacturers.
The difficulties faced by some automakers were recently illustrated by cost-cutting announcements from Europe's largest automaker. Volkswagen is even considering closing plants in Germany, for the first time.
BMW and Mercedes-Benz: Ugly numbers
For the quarter just ended (July-September), global sales fell by 13 percent for BMW and 3 percent for Mercedes-Benz.