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Mercedes pumps the brakes on EV goals after profits drop

Mercedes-Benz reiterated this week that it will continue to produce gas-powered vehicles well into the next decade, acknowledging its goal for producing nothing but electric vehicles is not going as well as the company hoped, amid a decline in profits.

“We want a CO2-neutral fleet by 2039,” CEO Ola Källenius said in prepared remarks to shareholders at the automaker’s general meeting on Wednesday. “However, the transformation might take longer than expected.”

Mercedes-Benz logo

Mercedes is reiterating to shareholders that it will continue to make gas-powered engines well into the next decade as profits wane amid EV push. (REUTERS/Athit Perawongmetha/File Photo / Reuters Photos)

Källenius said Mercedes will stick with making both EVs and electrified combustion engines, “If the demand is there, well into the 2030s.”

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The speech came after the German luxury carmaker reported a 30% drop in first-quarter earnings before interest and tax (EBIT) to 3.86 billion euros ($4.13 billion), compared with the 3.87 billion LSEG estimate.

A Mercedes-Benz dealership in Canada

Mercedes previously set a goal of producing nothing but electric vehicles by 2030. (Artur Widak/NurPhoto via Getty Images / Getty Images)

This is the second time this year that Mercedes has backtracked on its all-EV ambitions, after previously setting a goal for EVs to make up all of its sales by 2030.

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The company announced in February that it would not meet its 2025 deadline to have EVs, including hybrids, make up 50% of all sales. Lackluster demand for electric-powered cars has delayed that goal until at least 2030, the company said at the time.

An electric car charging

A Mercedes-Benz EQB 300 4MATIC electric vehicle (EV) recharges at a ChargePoint charging station at an Avis rental location near LaGuardia Airport (LGA) in the Queens borough of New York. (Bing Guan/Bloomberg via Getty Images / Getty Images)

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The CEO had previously warned late last year that even in Europe, sales would likely not be all-electric by 2030, with battery-powered cars currently making up just 11% of total sales, and 19% including hybrids.

FOX Business’ Chris Pandolfo and Reuters contributed to this report. 


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