(Reuters) – German luxury carmaker Mercedes-Benz on Friday reported a 64% drop in third-quarter profit at its core auto unit as Chinese consumers continued to hold back on luxury purchases amid the economic downturn. announced.
“The results for the third quarter did not meet our targets,” Chief Financial Officer Harald Wilhelm said in a statement.
Mercedes added that revenue in the July-September period was hit by model refresh costs as well as a tough market, particularly for the new version of the G-Class SUV that will be launched next quarter.
The company expects annual car sales to be slightly lower than the previous year, and sales in the fourth quarter are expected to be on par with the third quarter.
Automotive adjusted earnings before interest and tax (EBIT) fell to 1.2 billion euros ($1.3 billion), compared to LSEG’s average estimate of a 3.6% decline to 3.19 billion euros.
The news comes after the luxury carmaker lowered its full-year profit margin target twice during the third quarter, blaming a weakening China’s auto market for the drop in profits and margins. joins a growing number of European rivals.
Mercedes-Benz CEO Ola Källenius said that Chinese consumers are currently struggling with the current , warned that people are being extremely cautious about making big purchases.
(1 dollar = 0.9242 euro)
(Reporting by Andrey Sychev; Editing by Rachel More)
