Reluctant To Price War With Chinese Cars, Mercedes-Benz Remains Confident In Premium Strategy

JAKARTA - In the midst of a brutal wave of price wars in China's automotive market, Mercedes-Benz remains firm in its stance. Instead of saving prices, this luxury German manufacturer chose to maintain its premium strategy, even though it had to sacrifice its market share.

This step was expressed directly by CEO Ola Kaellenius, quoted from Reuters, Monday, September 8. According to him, although sales of Mercedes-Benz cars in China had fallen 19 percent in the second quarter of 2025, the company would not change course.

"We still charge prices a little more expensive, but GLC fans can be sure... in terms of price, if you are currently a GLC customer, you will still feel comfortable with this new electric GLC," Kaellenius said on the sidelines of the IAA Mobility car exhibition in Munich.

Mercedes-Benz now has high hopes for its newest flagship model, the GLC electric SUV, as the key to reclaiming dominance in the world's largest car market. Kaellenius believes that this model will be "targeted right" according to what Chinese consumers are looking for. This strategy demonstrates Mercedes-Benz' commitment to prioritize profit margins above sales volume, an approach that Porsche-class brands also adhere to.

On the other hand, the challenge for Mercedes-Benz does not only come from China, but also from the United States. This manufacturer is now waiting for the US government's decision to lower the car import rate from the European Union to 15 percent from the previous 27.5 percent. Although the impact on the company's finances has not been quantized, Kaellenius hopes that this tariff relief will be realized soon.

Amid the dual pressure from China's competition and international tariff regulations, Mercedes-Benz proved that they are ready to fight. By maintaining a premium brand identity and relying on product innovations like electric GLC, they hope to win back the hearts of consumers without having to give up on a weakening price war.