April 16 (Reuters) - Mercedes-Benz has targeted a sales volume of 500,000-600,000 vehicles per year in China in the medium term, its Chief Financial Officer Harald Wilhelm said on Thursday. The car
Mercedes investors warn luxury focus could hamper China recovery
Investor Concerns and Mercedes-Benz's Strategy in China
By Rachel More and Ilona Wissenbach
April 16 (Reuters) - Investors pressed Mercedes-Benz on its recovery plans for China on Thursday, warning that a luxury-focused strategy could hurt the German brand's chances of winning back Chinese consumers after a slump in sales.
Competition in the Chinese Market
Like rivals BMW and Audi, Mercedes has lost ground in the world's largest car market, struggling to keep pace with fast-moving local brands such as BYD, NIO and Li Auto, which offer tech-laden premium cars at lower prices.
Shareholder Criticism and Technology Demands
At Mercedes' annual shareholders' meeting on Thursday, investors questioned whether the Stuttgart-based automaker was doing enough to meet Chinese standards on technology.
Investor Perspectives
"Customers in China today buy innovation, not tradition. Anyone who isn't a technological leader there becomes a status symbol of a bygone era," said Moritz Kronenberger of Union Investment, a top-20 shareholder with about $276 million worth of stock.
Luxury Strategy Under Scrutiny
Kronenberger criticised Mercedes for developing new products from its luxury S-class range downwards, rather than adopting a more mass-market approach like its Chinese competitors.
Tanja Bauer of Deka Investment, which owns $191 million worth of Mercedes stock, also flagged "the risk of an overly narrow focus on luxury" in her remarks to the meeting.
Mercedes-Benz's Response and Future Plans
Mercedes plans to overhaul its lineup in China with seven new models by 2027 and the rollout of advanced driving assistance systems co-developed with Chinese tech firm Momenta.
CEO and Leadership Statements
CEO Ola Kaellenius said this marked the biggest product and technology offensive in the company's history, backed by local development and partnerships.
"This enables us to accelerate innovations tailored to the needs of Chinese customers," Kaellenius said.
Sales Performance and Targets
Mercedes' sales in China fell 19% last year to 552,000 vehicles. The decline accelerated to 27% in the first quarter of 2026.
Financial Goals
"We have clearly defined, ambitious yet realistic goals for China," finance chief Harald Wilhelm told investors. "In the medium term, we are aiming for annual sales of 500,000 to 600,000 vehicles in China."
(Reporting by Ilona Wissenbach and Rachel More. Writing by Linda Pasquini. Editing by Madeline Chambers and Mark Potter)
