Mercedes-Benz Faces a Growth Paradox: BEV Sales Rising, Market Share Falling, Shares at Lows

Mercedes-Benz' European EV sales rise but stock near 52-week low as Chinese automakers like BYD and Chery capture rapid growth, raising margin concerns.

Mercedes-Benz is selling more electric vehicles in Europe than a year ago, yet its stock is plumbing depths that suggest investors see little room for optimism. The contradiction stems from a simple reality: the company is losing ground in a market that is itself expanding rapidly, while Chinese rivals are eating the lion’s share of the new business.

The European Automobile Manufacturers’ Association (ACEA) reported that new-car registrations in the EU, EFTA states and the UK rose 3.6 percent in May to roughly 1.15 million vehicles. Over the first five months of 2026, the market was 4.5 percent ahead of the prior year. Battery-electric vehicles (BEVs) drove that growth, jumping 39.1 percent in May, while plug-in hybrids climbed 13.2 percent. In contrast, petrol and diesel registrations each slumped about 19 percent.

Mercedes-Benz, however, managed only a 0.6 percent increase in its European registrations during May — a fraction of the broader market’s pace. The gap is widening. Chinese manufacturers are capitalising on the shift to electrification with breathtaking speed. BYD’s European registrations surged roughly 136 percent in May, Chery’s jumped 244 percent, and Leapmotor’s soared 465 percent. Although their absolute market shares remain modest, the trajectory is unmistakable.

The stock market has taken notice — and not in a favourable way. Mercedes-Benz shares closed at €44.34 on Wednesday, just 1.26 percent above the 52-week low touched on June 18. The equity has shed 27.75 percent since the start of the year, more than most peers. The Stoxx Europe 600 Automobiles & Parts Index fell to its lowest level since March on Tuesday, reflecting broad sector weakness.

Technical indicators underscore the bearish sentiment. The stock’s distance from its 200-day moving average has stretched to roughly 19-20 percent, a level that often signals sustained selling pressure. The 30-day loss stands at 12.66 percent, and every attempt at a rally has been met with fresh selling.

Yet Mercedes-Benz is not standing still. The company reported that its BEV sales in Europe rose 34 percent in the first quarter, and by 36 percent in Germany alone. The group reiterated its full-year guidance after first-quarter results, citing intense competition and geopolitical headwinds. But the market wants more than volume growth — it wants evidence that margins can hold up as the product mix shifts toward lower-priced electric models and as price competition intensifies.

The ACEA data contained no profit warning, but it laid bare a structural issue. Mercedes-Benz is growing in absolute terms, yet its relative position is deteriorating. The question for the stock is whether management can navigate the transition from high-margin combustion-engine vehicles to a more competitive EV landscape without eroding profitability. Until that becomes clearer, the share price is likely to remain tethered to its lows.