Mercedes-Benz Halts German Investment and Weighs Plant Closures

Mercedes-Benz announced on November 12, 2026, that it is halting all further investment at its German facilities. The company is evaluating potential plant closures to address unsustainable cost structures, noting that labor costs in Germany are reportedly five times higher than those at its plants in Eastern Europe.

Mercedes-Benz attributed the decision to a combination of declining sales and profits. The automaker cited weakened demand in China, its largest market, and a slower-than-expected transition to electric vehicles in North America and Europe. The company also reported approximately €1 billion in profit losses resulting from U.S. tariffs under President Donald Trump and increased competition from lower-cost Chinese electric vehicle imports.

Chief Production Officer Michael Schiebe announced the investment freeze via a company memo, while board member Britta Seeger stated the company must now examine which German sites it can afford to maintain. These moves come amid mounting pressure from the IG Metall trade union and the company's works council.