Mercedes-Benz Stock Experiences Decline, as New Figures Are Revealed
In early trading on Tradegate, the Mercedes-Benz share is losing 2.7%, trading at 53.01 euros. This comes as the company grapples with the impact of tariffs and geopolitical uncertainties.
Despite the challenges, analyst Patrick Hummel of Swiss bank UBS remains positive, highlighting the strong cost discipline in the passenger car segment. Another analyst, Philippe Houchois of Jefferies, interprets Mercedes-Benz's outlook statements as a withdrawal of previous forecasts.
Mercedes-Benz has been impacted by tariffs and geopolitical uncertainty, but the effects in 2025 appear to be limited so far. This is due to a combination of easing trade tensions, mitigation strategies, and recent trade agreements.
The tariff impact on profit margins is limited, with Mercedes-Benz expecting tariffs to reduce Q2 2025 profit margins by less than 3% for its core car divisions. This is despite the uncertainty created by the ongoing trade dispute and geopolitical factors.
While dealerships are holding 2025 model year prices steady for now, Mercedes-Benz expects "significant price increases" in coming years due to tariffs. The company withdrew its full-year earnings guidance in April 2025 due to the uncertainty created by tariffs and geopolitical factors.
Analysts acknowledge ongoing risks from geopolitical and trade uncertainties but see the recent 15% tariff agreement as a positive development compared to the previously threatened 30% tariffs. Margins may be pressured somewhat in the near term, but mitigating actions, local U.S. production, and trade deal benefits are expected to help Mercedes-Benz navigate the uncertainties.
The company’s cautious approach, including inventory measures and withdrawing earnings guidance, reflects the still fluid environment but points to resilience amid evolving trade policies. Analysts predict possible price increases and margin effects going forward but also highlight improvements in trade terms that could boost overall performance relative to prior fears.
In the crucial passenger car segment, the adjusted operating margin for Mercedes-Benz declined by 1.7 percentage points to 7.3%. The operating result before interest and taxes (EBIT) for Mercedes-Benz fell by almost 41% to 2.29 billion euros in the first quarter.
Mercedes-Benz, a Stuttgart-based automaker, has faced a challenging start to the year due to weak business in China. Despite this, Harald Wilhelm, the CFO of Mercedes-Benz, remains optimistic about the company's future, citing the new CLA model as a source of fresh impetus.
However, the current trade policy makes it difficult for Mercedes-Benz to reliably assess the impact on demand. The share has temporarily hit resistance in the form of the 38-day line, and the 50- and 200-day lines also run just above the current share price.
If the current trade policy persists, negative effects on EBIT, free cash flow, and operating margins in the business fields can be expected. The company warns that U.S. import tariffs on cars will significantly impact its profits this year.
Despite these challenges, investors remain on the sidelines, waiting for a clear signal from the stock. The management and majority shareholder of the publisher Boersenmedien AG, Mr. Bernd Förtsch, has entered into direct and indirect positions in the financial instruments mentioned in the publication or related derivatives, which could benefit from the potential price development resulting from the publication.
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- Despite the tariff impact on its profit margins, Mercedes-Benz expects it to reduce Q2 2025 profit margins by less than 3% for its core car divisions, a testament to the company's cost discipline in the passenger car segment.
- The recently agreed 15% tariff reduction is a positive development for Mercedes-Benz, as it could help mitigate the negative effects from geopolitical and trade uncertainties, thereby benefiting the company's overall performance.
