Mercedes Implements Cost-Cutting to Counter Profit Decline

Mercedes-Benz is adjusting its financial strategies in response to a recent downturn in profits. The company is issuing a reduced bonus of up to 5,220 euros to 91,000 German employees, a notable decrease from the previous record bonuses of 7,300 euros. This decision follows a 28% drop in overall profits, with sales down by 4.5% and earnings declining by one-third, largely due to weak performance in the Chinese market.

In response, Mercedes is launching a comprehensive cost-cutting program titled 'Next Level Performance.' This initiative includes measures such as reducing premiums, increasing temporary work, and offering buyouts, alongside extending job security until 2034. The company aims to cut production, material, and fixed costs by 2027, while maintaining stable base salaries for executives in 2025. These steps are part of Mercedes' strategy to enhance profitability and competitiveness in the face of market challenges.