An employee performs final inspection on a Mercedes-Benz C-Class sedan at the Mercedes-Benz U.S. International Plant in Vance, Alabama.
Andrew Caballero-Reynolds | AFP | Getty Images
Benz The German automaker's shares fell more than 8% on Friday after it cut its 2024 guidance due to weak demand in China.
The company said late on Thursday it now expects group earnings before interest and tax (EBIT) to be “significantly lower” than the previous year, with adjusted return on sales to be between 7.5% and 8.5%, down from its previous forecast of 10% to 11%.
The stock narrowed its losses slightly, falling 7% as of 9:15 a.m. London time.
The automotive sector dragged down 3.2% Volvo and Strantis fell 4% and 2.7% respectively.
Mercedes said in a statement on Thursday that the company's adjustments were triggered by “a further deterioration in the macroeconomic environment”, mainly due to weak consumption in China and a long-term downturn in the country's real estate industry.
“This has affected overall sales in China, including those in the high-end segment. Overall, the sales mix in the second half of 2024 is expected to remain unchanged from the first half and is therefore weaker than initially expected,” the company said.
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