Mercedes-Benz cut its Guidance The adjusted return on sales for cars is now 2–3%, down from 3–5%, and EBIT is expected at about last year's level. Mercedes has lowered its full-year forecast, as higher-than-expected input costs and deteriorating sales figures in China weigh on fourth-quarter results. The profit margin for Mercedes’ car division nearly halved in the third quarter. The adjusted return on sales slumped to 2.5 percent, down from 4.8 percent in the same period last year, the company announced on Wednesday. In China, sales fell by 31 percent to 86,800 vehicles delivered. “In addition to an increasingly challenging market environment in China, the Mercedes-Benz Group expects higher costs in the fourth quarter, including higher material costs,” the company stated. Meanwhile, Mercedes-Benz is offering severance payments of up to 330,000 euros to employees who agree to the termination of their employment contract. Its getting worse from here.

Mercedes-Benz Group is pushing ahead with its biggest product and cost overhaul in years, betting it can restore profitability even as China turns from a growth engine into one of the biggest drags on the business.