Mercedes-Benz threatened to close a plant in Germany and relocate production
a month ago by schizoidman to c/europe
Mercedes-Benz management warned that it plans to close one of its plants in Germany and move production to Eastern Europe if employees do not agree to cost-cutting measures. Wirtschaftswoche reports this, citing company sources, with UNN reporting, citing Bild.
According to the publication, management is demanding that employees give up some benefits, including vacation pay and Christmas bonuses, as well as reconsider the 35-hour workweek. Management believes that current conditions are making German plants less competitive amid
Blaming management when the truth is the car industry has been in an almost perfect storm for almost a decade.
- Global Chip shortage ( Disruption of supply chain, decreasing sales due to slowed production )
- Covid ( Hurting sales and production )
- Energy crisis in Europe imposed by Russia before they invaded Ukraine ( Increasing production cost )
- Increased competition from China ( lowering sales and profits )
- Brexit ( Disrupting supply chains, and decreasing sales to UK )
- Transition to EV ( Increasing cost of R&D and production due to more models makes production more expensive )
- Sanctions against Russia ( Loss of market and the value of investments in supplying the country )
- US Tariffs ( Preventing sales to USA )
- War in Iran ( Disrupting the economy and economic outlook, lowering car sales globally )
All these issues have direct impact on all European car brands, VW is making EU best selling EV cars, and they too have problems.
But yes the management for the car brand that makes the most energy efficient EV is incompetent.
They sold their soul in China for short term profit.
They never had a long term plan, they just saw the profit they were making in China, given away their technology advantage.
So this is solely the management to be blamed for. During Covid they were making record profits, due to the state paying the employees.
I worked 5 years for Mercedes and over 10 years in German car industry. They always kept laughing at Tesla and Chinese cheap EVs, now look were they are. No one wants the Mercedes expensive EVs...
They sold their soul in China for short term profit.
Exactly what did they sell out? Exactly what technology did China "steal" from Mercedes?
Car manufacturing has been a global business for more than half a century. Should they just ignore a major emerging market?
During Covid they were making record profits,
Yes the Chip shortage had the effect that car prices increased, making each car more profitable to sell.
But the after effect was a near recession and inflation where profits and sales fell back. Only helped partially and regionally subsidizing EV sales.
They always kept laughing at Tesla and Chinese cheap EVs.
Doesn't change the fact that Mercedes today make the best electric cars on the market without comparison. So they must have done a heck of a lot more than just laughing.
No one wants the Mercedes expensive EVs…
That's an absolutely moronic claim, A Mercedes CLA is not much more expensive than a VW ID.4 here.
But yes compare to a Fiat 500 Mercedes is expensive, but that doesn't mean they don't have good value.
No one wants the Mercedes expensive EVs…
That graph doesn't say much about profits, but lists like this one did look very different 10-20 years ago. I'm no expert on the topic, but I have no reason to believe Europe couldn't have done what China did. It's not just because Chinese labour is cheaper that they sell so many cars. I don't know enough to blame it on the management but I do have a feeling they could have done better. Also not a single new European brand selling enough to get on this list. I don't know enough to blame it on politicians, but I also have a feeling they could have done better. I don't mind China "winning", but I sure am disappointed to see EU "losing" this market. Especially Germany is getting some serious hits.
Edit: uploaded the image because it didn't want to be embedded.
Exactly what did they sell out? Exactly what technology did China "steal" from Mercedes?
Car manufacturing has been a global business for more than half a century. Should they just ignore a major emerging market?
To get a car certified to be sold in China, you need to get a certification, where you need to provide all technical plans and documents for them to be certified. Most of the time a year later there would be a quite similar looking car from a Chinese brand. Collected data about the car and customer is stored on Chinese servers, where the government has access to.
So I am pretty sure they would never give any of that data to their own manufacturing companies...
Of course they should sell their cars there, but they should have also prepared for what will happen in the long term. They kept selling petrol cars, because they were are the most profitable cars.
Yes the Chip shortage had the effect that car prices increased, making each car more profitable to sell.
But the after effect was a near recession and inflation where profits and sales fell back. Only helped partially and regionally subsidizing EV sales.
Their sales of petrol cars gone down in China the last few years and this is where they make the most profits.
Doesn't change the fact that Mercedes today make the best electric cars on the market without comparison. So they must have done a heck of a lot more than just laughing.
If they make the best cars, why no one wants them? The sales figures don't show it. Teslas are expensive still sell a lot higher volume.
Don't get me wrong, I would hope they do better, as I hate Musk and his Swasticars. I am from Germany and would like our economy doing well, but they should take their fair share, why we are in this situation today.
The management of the German car makers made a bunch of bad decisions and now the employees have to take the burden.
For example an S-class brings about 8000€ of profits, EVs are no way near that. And they sold most of their most profitable cars in China. Now this has gone back a lot and they are missing this income.
Please.
Just look up how much dividends they have payed in the last few years alone (spoiler: it is almost 24 billion € since 2022). This is money that could have been spend innovating, improving and future proofing there vehicle line up.
The death of the combustion engine is nothing new, and yet all of the European car manufacturers hold onto it like it is their only hope.
Sadly I don’t have all the sources right now because I looked it up this morning.
But here is a source for 5 billion for the year 2023. Here is a source for 3.3 billion for the year 2025
Here is another source that has multiple years (although I don’t know if it is trustworthy, but the numbers match with the others).
Also note that in addition to these dividends, mercedes Benz did buy back quite a lot of stock.
So money is really not an issue here.
I am in fact blaming Daimler management for this, yes. It was back in 2010 or so that Mercedes-Benz bragged about having a full electric line-up by 2015 so they've had 15 full years of head start before the chinese came and started taking their lunch. What did they do in the meantime? They colluded with VAG and BMW to keep diesels in the mix. And yes, they've veen trying to weather a nasty storm recently, but they asked for state support every step of the way ( and received it most often than not, precisely because germany wanted to keep those people employed ). Now I'm not sure how their recent EVs fare, but Daimler has been constantly resistant to change ( going as far as anti-ev propaganda spewed by the CEO making the rounds in right-wing groups ) and that blame lies solely with the company's management.
They move3d fast, but so did the Chinese. It's a competition, your opp0onent doesn't always do as expected. China came sooner than expected because the Chinese development has been insane. No wonder Mercedes didn't expect them to move that fast.
But the Chinese market is over saturated now, which is why China expands to Europe before expected.
You forgot decades of enshittification in order to maximally capitalise on the international luxury market rather than building quality products that earned them the reputation that allowed them to do so in the first place.
I am not aware of enshitification with Mercedes.
On the contrary I just saw a review the other day of the Mercedes ACL vs Zeeker. The Mercedes was way higher quality, and the assist systems actually work, contrary to Chinese cars, and the efficiency of the Mercedes was 20-25% higher!!
Yes China can build some pretty attractive cars with decent specs, but don't get fooled to think they are of similar quality to any label of German cars.
Do you even know what Mercedes was once standing for and what it lost thanks to the “great management class”? - btw, management means imo people, who generally have little year-long experience in working in a factory, the assembling and design line, but happily demand salaries almost twice or even three times as much as a normal worker (due to some fantasized responsibility) and are quick in suggesting to throw people on the street when economical problems appear. IMHO, these managers are the most expensive and useless group in most if not all industrial branches (we can continue with the DB).
But but but... how can they afford their third yacht?!!!!
Stop buying German brands! They're blackmailing their employees and that is not ok!
Every day more or less the same story by OP. The entire industry is in crisis, not just Mercedes-Benz. In China, those three show shrinking profits. This is despite Chinese brands benefiting from tremendous subsidy regulations that have never been available for their global competitors, a cheap workforce through forced labour regimes, which allows them to produce massive overcapacity that Chinese brands then need to sell globally due to a shrinking domestic Chinese market. This overcapacity is a decisive reason for the entire sector's crisis imo.
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