Mercedes-Benz to only offer all-electric lineup in markets with strong demand

Mercedes-Benz is getting a lot of flak from the internet today as various media outlets claim it backtracked on its promise to manufacture only all-electric vehicles by 2030.

Let us clear up the issue. In July 2021, the company announced that they are indeed going all-electric by 2030, but with a caveat – it will only sell electric vehicles ‘where market conditions allow.’ That last part was conveniently left out by many writers in their report. So, without stating the obvious, Mercedes-Benz implied that in markets where EV demand is low, it will still sell gas-powered models.

Perhaps the audience at the time got excited when Mercedes-Benz also stated that it would offer a fully electric model in every segment and even prepare three EV architectures, one for passenger vehicles, another for performance cars, and the last one for commercial units.

However, Mercedes-Benz has indeed slowed down its electrification goals in terms of sales. Previously, the company was expecting 50% of its sales to be all-electric by 2025, but demand doesn't seem to be heading towards that goal. Instead, Mercedes-Benz pushed the 50% sales target to 2030, with which they also included electrified vehicles such as mild and plug-in hybrids.

In a recent report by Reuters, Mercedes-Benz CEO Ola Kallenius was quoted as saying the brand is likely to introduce a new ICE lineup in 2027 that should have a model cycle that lasts well into the 2030s.

Unsurprisingly, Mercedes-Benz is not the only manufacturer that will continue offering gas-powered models. Even car rental companies are cutting down on EV purchases because it is more expensive to maintain than regular cars.

Slower customer demand, production delays, and supply chain issues forced Mercedes-Benz and several other automakers to be more conservative with EV projections. Ford and General Motors (GM) are scaling down on EV-related spending, the Honda-GM EV collab is now effectively canceled, Volkswagen will stop making the ID3 in China, and Tesla revealed late last year that profit margins have hit a four-year low.

Mercedes-Benz saw the future in 2021 and had a hunch that it would not be all-electric, yet. They were right.

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