Mercedes-Benz entered the new year under growing pressure to demonstrate that its electric strategy remains on track. Latest figures show the German premium carmaker lost more ground to BMW in battery-electric vehicle sales last year.
Chased hot on the heels by the competition, demand has weakened in key regions. A spark of hope comes from the first commercial results of the all-new CLA.
Tough performance
Mercedes-Benz sold 168,800 fully electric passenger cars in 2025, a nine percent decline from the previous year. The drop left pure EVs accounting for less than 10% of the brand’s global passenger-car deliveries, a weak performance for a company that once positioned itself as a front-runner in the electric transition.
Market conditions are one thing, but by contrast, BMW widened its lead, delivering 442,072 electric vehicles in 2025. That’s a 3.6 percent increase. The comparison underlines the diverging trajectories of Germany’s two largest premium brands.
Slide of nine percent
The setback for Mercedes was not confined to electric models. Overall passenger car sales also slid nine percent to about 1.8 million vehicles, one of the brand’s weakest annual performances in recent years.
The decline reflected pronounced weakness in Asia and North America. China stood out as a significant drag, with deliveries falling 19 percent as domestic brands continued to erode the position of foreign manufacturers in the world’s largest auto market.
Focus on pricing discipline
Electric vehicles were hit particularly hard by those regional pressures. Chinese carmakers led by BYD have expanded aggressively, combining lower prices with rapid product updates. Also, demand for premium vehicles has been dampened by economic uncertainty.
Mercedes’s insistence on pricing discipline has protected margins but limited its ability to defend volume. This is especially true for the Chinese market, which has become increasingly price-sensitive.
While BMW also faced pressure in China, it grew global EV sales and is betting heavily on its Neue Klasse models to sustain that momentum.
Light in the tunnel
There were pats on the back for Mercedes, but in the margins. Mercedes-AMG recorded one of its strongest years on record, with G-Class sales rising sharply, supported by demand outside the United States.
Plug-in hybrid vehicles also provided a cushion, with global deliveries increasing nine percent. Logically, that growth kept total electrified vehicle sales flat year over year.
More importantly, there’s light ahead in the tunnel. Company executives have pointed to signs of traction late in the previous year. Fourth-quarter EV deliveries rose compared with both the prior quarter and the same period last year, driven by the launch of the electric CLA.
Order books for the CLA and the upcoming electric GLC stretch well into the second half of 2026. These newcomers, which embody Stuttgart’s revised electric strategy, offer hope that the worst may be in the rearview mirror. Still, Mercedes expects overall growth to resume only gradually next year.
