Mercedes-Benz Group AG is one of the leading global suppliers of premium and luxury cars and vans. Mercedes-Benz Mobility AG offers financing, leasing, car subscription and car rental, fleet management, digital services for charging and payment, insurance brokerage, as well as innovative mobility services. The company’s focus is on innovative and green technologies as well as on safe and superior vehicles that captivate and inspire. The company’s goal is to go all-electric, where market conditions allow.
In 2022 the global automotive market was negatively impacted by the effects of the war in Ukraine, the covid-related lockdowns in China, the ongoing disruptions in global supply chains and semiconductor shortages. Globally, the automotive market was significantly lower in the second quarter in comparison to the same period of the prior year. Despite the challenges, Mercedes-Benz Group AG achieved strong Q2 financial result which was released on the 27th of July 2022, “thanks to sustained demand for luxury vehicles and premium vans, a good model mix, enhanced pricing power and ongoing cost discipline”.
In the wake of heightened geopolitical tensions in Eastern Europe, “Mercedes-Benz has sought to safeguard supply chains and to maximise the potential for reducing or substituting the use of natural gas in vehicle production” according to a company’s news release. “Mercedes-Benz sees a gas reduction potential of around 50% in Germany. The company’s long-term goal is to switch from gas to electricity and other renewable energy sources. The company continues to transform at full speed towards an all-electric future”.
On 11th of October 2022 Mercedes-Benz released its global Q3 (July to September) sales report. In Q3, Mercedes Benz sold 30,000 battery electric vehicles (5.8% from all vehicle sales), which represents an increase of 115% compared to the Q3 2021 and an increase of 28% compared to the Q2 2022. EV demand in the US is ramping up and Mercedes is introducing a full line-up, including the new EQS SUV which premier is later this month. Despite the challenging business environment for the industry, Mercedes appears to be faring better than most of its peers.
Electric vehicle sales were stronger than any other segment in Q3, helping the overall vehicle deliveries to reach 517,800 units (up 21% from Q2). This result shows Q3 is the strongest quarter this year, thanks to continuing demand for luxury EVs. The group has reached the sales numbers of its direct competitor BMW for Q3 (517,689 vehicles sold). As with BMW and other car makers, production and sales continue to be affected by semiconductor shortages and disrupted supply chains. Otherwise, the sales results could have been better, as demand outweighs production.
Parallel to the passenger car division, the Group’s sister company Mercedes-Benz Vans delivered an additional 3,300 electric vehicles in Q3. The company expects electric car sales to grow further, as new models would be introduced. The Mercedes-Benz EQE would be next plus configurations of existing models are on the pipeline.
The shares of Mercedes-Benz Group AG have been trading in a very strong up trend since March 2020, rallying from a low of €17.45 to a high of €77.90 reached in February 2022. A large bearish divergence between the price and the RSI indicator has formed on the weekly chart throughout April 2021 and February 2022, showing that internal momentum conditions have deteriorated. A large head and shoulders pattern has formed on the weekly chart, showing that selling pressure is building up.
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