Mercedes-Benz’s personnel restructuring in China represents not merely a short-term, department-specific downsizing, but rather an ongoing strategic response to declining sales, the imperative for cost control, and the need to enhance organizational efficiency. Since 2025, these adjustments have spanned multiple functions, including automotive finance, sales, IT, research and development (R&D), and manufacturing. The measures implemented encompass layoffs, non-renewal of expiring contracts, business downsizing, and workforce realignment, with compensation packages varying accordingly. Notably, the R&D division has emerged as a focal point for workforce reduction, with an anticipated 10% cut in headcount this year. Manufacturing adjustments commenced earlier, with over 2,000 employees departing from Beijing Benz in 2025, coupled with an increase in factory holidays due to reduced production volumes. Concurrently, employee benefits have been curtailed, and the work pace has intensified.

Mercedes-Benz has witnessed a persistent decline in its Chinese sales, with a 7% year-on-year decrease in 2024, a 19% drop in 2025, and a 27% slump in the first quarter of 2026. This downturn reflects structural challenges posed by the rise of new energy vehicles (NEVs) and intelligent transformation, as traditional luxury brands grapple with shifting market dynamics. Chinese consumers’ evaluation criteria for premium electric vehicles have evolved, prioritizing technological sophistication and fulfillment capabilities. This shift has eroded Mercedes-Benz’s technological competitive edge, as its pure electric offerings have yet to captivate buyers. Internally, employees harbor a pessimistic outlook on the competitiveness of the brand’s NEV lineup. Analysts emphasize that to reverse its fortunes, Mercedes-Benz must deeply integrate China’s local technological ecosystems and re-establish its unique value proposition. Failure to do so risks marginalization, relegating the brand to a niche market presence.