Mercedes Restarts Redundancy Program Amid China Market Struggles

On 28 October 2026, Ola Källenius, the Chief Executive of Mercedes, announced the relaunch of a voluntary redundancy program for indirect staff in Germany. This decision aims to further reduce the company's fixed costs following a lowered profitability outlook for 2026, which is now expected to be broadly level with 2025's €5.8 billion.

The announcement comes in light of a challenging market in China, where Mercedes' vehicle sales fell 31% year-on-year in the third quarter. The company is also in discussions with trade unions regarding additional cost-cutting measures, although no specific redundancy targets have been set.

Mercedes' third-quarter revenue decreased by 4.5% to €30.7 billion, and adjusted group operating profit fell by 15%. The company plans to localize more of its supply chain in China and expand production in lower-cost countries like Hungary.

The new redundancy program follows a previous round in 2025, which incurred about €1.8 billion in provisions.