Mercedes-Benz: An Armored V12 and a Vulnerable Stock as US Law Looms

Mercedes-Benz shares flirt with 52-week low as US Senate bill targeting Chinese investors could block imports; Q1 revenue slips 5% while US sales surge.

Mercedes-Benz can build a car tough enough to withstand assault rifles and explosive blasts, but its stock is proving far more fragile. The Stuttgart automaker has just rolled out the updated S 680 Guard 4MATIC, a 4.2-ton luxury limousine certified to the highest civilian protection level, VR10. Beneath its discreet aluminium shell lies a V12 biturbo engine, an all-wheel-drive system fitted for the first time in a Guard model, and a suite of survival features — including a fire-suppression system and an overpressure fresh-air unit that seals the cabin against chemical attacks. Yet even as the company showcases its engineering might, the share price is flirting with a 52-week low and a new legislative threat from Washington has entered the frame.

That threat is the “Connected Vehicle Security Act,” a bipartisan bill in the US Senate that targets cars with significant Chinese ownership ties. The legislation draws a red line at a 15% stake held by Chinese investors — a threshold Mercedes potentially breaches through its shareholder structure. The BAIC Group controls roughly 10% of Mercedes shares, while Tenaciou3 Prospect Investment Limited holds a further 9.7%. Together, the two exceed the limit. If enacted, software restrictions would take effect as early as 2027, with hardware rules following in 2030, giving the US Commerce Department the power to block imports and sales entirely. General Motors has already voiced support for the measure, calling it a vital safeguard for domestic production.

For Mercedes, the US market is not a side dish — it is a main course. In the first quarter the company sold 78,500 vehicles in America, a 20% jump from a year earlier. That growth helped offset a worsening slump in China, where demand continues to erode. Losing access to the US would be a severe blow, and executives are acutely aware that the political winds are shifting. The management team will face investors on May 19 in Los Angeles at the “MBG US Capital Market Event & AMG World Premiere,” where it plans to unveil a new AMG model alongside a broader electric-vehicle strategy. The event doubles as a moment to address the mounting regulatory risk and to convince shareholders that Mercedes can still deliver profitable growth in an increasingly complex transatlantic environment.

Operationally, the numbers paint a sobering picture. Group revenue slipped nearly 5% to €31.6 billion in the first quarter, marking the twelfth consecutive quarter of declining sales. The China headache persists, even as Europe and the US show signs of life. Excluding China, global passenger car deliveries actually rose 5%, but the Asian shortfall has been too deep to overcome. That dynamic has weighed heavily on the stock. On Friday the shares closed at €50.10, and by Monday they had slipped further to €49.60 — just a hair above the 52-week low of €47.92. So far this year, the equity has lost roughly 19% to 20% of its value, depending on the day’s trading.

RBC analyst Tom Narayan sees a potential catalyst beyond the headlines. He rates the stock with a price target of €56 and argues that selling the remaining stake in Daimler Truck could unlock capital and sharpen the focus on Mercedes’ core automotive business. Whether that move alone can counterbalance the twin pressures of a softening top line and a hardening US regulatory environment remains an open question. The LA event in May will give investors a clearer sense of the roadmap — and of whether the company’s armor is thick enough to weather the storm.