Mercedes-Benz Stock at a Crossroads as China Woes Deepen and Technical Signals Flash Red

Mercedes-Benz faces a pivotal week with Q1 earnings, a death cross pattern, and a 25% China sales drop. Stock near 52-week low as it expands IONCHI charging venture with Seres.

Mercedes-Benz investors are bracing for a pivotal week as the automaker prepares to release first-quarter results on Wednesday, April 29, amid a perfect storm of declining sales, a bearish chart pattern, and mounting pressure from Chinese rivals. The stock has already shed roughly 18 percent since the start of the year, trading near €50.65 — uncomfortably close to its 52-week low of €48.45.

A Death Cross Adds to the Gloom

The technical picture took a decisive turn for the worse just days ago. On April 23, immediately following the dividend payment two days earlier, the daily chart flashed a so-called "death cross" — the 50-day moving average sliced below the 200-day moving average. Both trendlines now sit well above the current share price, with the shorter-term average at €54.64 and the longer-term at €55.82. The relative strength index has dropped to 38.8, edging toward oversold territory but not quite there yet.

The dividend itself — €3.50 per share, approved at the virtual annual general meeting on April 16 — offered shareholders a decent yield on paper. But the payout came against a backdrop of sharply lower earnings. Net profit for the 2025 financial year halved to €5.3 billion from €10.4 billion, prompting criticism from analysts and shareholder representatives who questioned the wisdom of maintaining such a generous distribution while the company pours billions into its MB.OS operating system and electric vehicle transition.

IONCHI Gets a Third Partner

To shore up its position in China, Mercedes-Benz is reshaping its charging infrastructure joint venture. The Seres Group, a Chinese automaker, is joining IONCHI — originally a partnership between Mercedes-Benz and BMW. Under the new arrangement, all three companies will hold an equal one-third stake. The expanded venture plans to build a premium charging network in urban centers powered entirely by renewable energy, with exclusive reservation slots and priority power allocation for customers of the three brands.

The move comes as the Stuttgart-based group struggles to contain a deepening sales slump in Asia. Global deliveries of cars and vans fell 6 percent in the first quarter, but the drop in China was far more severe at over 25 percent. By contrast, the US and European markets posted modest gains.

Localized Models Take Center Stage

At the upcoming Beijing Auto Show, Mercedes-Benz will unveil a long-wheelbase version of the GLC L EV, an electric SUV tailored specifically for Chinese buyers. The vehicle uses an 800-volt architecture for faster charging, boasts top-tier interior features, and offers a range exceeding 700 kilometers. It represents the company's attempt to claw back ground lost to domestic premium EV makers that have been aggressively discounting in the same segment.

CEO Ola Källenius continues to bet on the luxury end of the market and the proprietary MB.OS software platform as the twin pillars of profitability, even as volumes shrink. The strategy faces a stern test: the automotive division's return on sales slipped to around 5 percent in 2025, and the company has set a target of 8 to 10 percent for 2026 — a gap that will require a sharp turnaround.

What to Watch on Wednesday

When Mercedes-Benz publishes its first-quarter interim report next Wednesday, the market will be laser-focused on margin trends for the high-end top-end models. Detailed guidance on profitability and the substantial investment requirements for autonomous driving technology will likely dictate the stock's near-term direction. With the €50 support level looking fragile and the death cross still fresh, the earnings release could determine whether the shares bounce or slide toward that 52-week floor.