Mercedes slumps after cutting EV prices in China

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Mercedes slumps after cutting EV prices in China
Credit: © Reuters.

By Peter Nurse - Mercedes Benz (ETR: MBGn ) stock slumped at the open Wednesday after the auto giant cut prices on two electric car models in China, looking to reposition in a highly competitive market.

By 04:20 ET (09:20 GMT), Mercedes stock in Frankfurt was down 6%.

Mercedes said in a statement on its website that it was reducing prices by up to $33,000, and that it would provide subsidies to customers who recently bought the cars.

The German luxury car maker has struggled to take on local manufacturers in the world's biggest market for electric vehicles.

This news comes just a few days after it lifted its guidance for annual core earnings, reporting a sharp rise in earnings in the third quarter as sales of the group's luxury and electric cars helped overcome ongoing disruptions to the supply of key chip parts.

Mercedes stock is down by almost 9% this year and nearly 18% over the last 12 months.

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