Mercedes and VW fail in their electric car targets

The German automobile industry is one of the most powerful in the world. Brands like Mercedes-Benz and Volkswagen aim high in the electricity market, but maybe too much. The numbers don’t quite add up.

One thing is what you expect to sell and quite another is what you get. Faced with the era of electromobility, Mercedes and Volkswagen have put a lot of meat on the grill. Both companies have made a strong commitment to electric cars. Ambitious production and sales figures that according to analysts are not being achieved, at least for now. The figures show that although the path is good, sales are not accompanying. A clear example is that Mercedes has had to significantly reduce the price of its electric cars in China due to the low demand for them.

The world is moving right now in an atmosphere of economic instability. Many countries are announcing lower growth targets, stock market health is weak, to say the least, and markets are bracing for a slowdown in sales with inflation skyrocketing across many continents. Given this scenario, electric cars are still difficult to access for many drivers, who prefer to reserve their money or bet on cheaper brands and models, something that is not especially good for Mercedes or Volkswagen.

With the former CEO Herbert Diess at the helm, Volkswagen bet on the electric market with the launch of its ID family. The strategy for the future is to convert the entire range, although for now, it is difficult to sell it en masse. Despite the high production figures in electric plants such as Zwickau, the reality indicates that Volkswagen has grown less than expected in the global electric panorama. Despite this, it is the fourth group that has grown the most, below Tesla, BYD, and General Motors. Worse are the results obtained by Mercedes.

Those from Stuttgart have set out to surpass Tesla many times, but according to a Bloomberg analysis, they are a long way from achieving that goal. Like Volkswagen, Mercedes grows in its electric deployment, but by only 1.9% between January and September of this year. It is the sixteenth company in the ranking. This is a hard blow for a brand that has announced such strong investments in the electric field, so strong that it has declared the barrier of 2030 as the year in which it will become 100% electric.

VW ID.5

In economic terms, the outlook is even grimmer since the main German manufacturers, BMW, Mercedes, and Volkswagen, have announced more than 100 million euros to expand their strategy. Costs for the development of products, technologies, and software will take time to be reflected again in the coffers of the companies. The hope for all of them is a quick change in the current situation, although analysts are not very determined in this regard. The global crisis of components and materials will continue for at least a year.

Volkswagen already knows that they do not reach its objectives, and that is why they have decided to reassess the situation. Oliver Blume, the new CEO of the Volkswagen Group, is seriously considering delaying his most ambitious project of his, the Trinity project, by two years. Software issues are causing severe setbacks and early-release models are having their release dates postponed, such as the Porsche Macan. It must be borne in mind that the Germans are not the only ones who are being affected by this problem since Toyota is in a very similar situation as we told you last week.

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