Mercedes-Benz Faces Twin Crises of Labor Revolt and Supply Chain Collapse as Shares Languish
Published on 07/05/2026 at 16:12 | Redaktion boerse-global.de
The assembly lines at Mercedes-Benz’s Bremen plant have ground to a halt, a stark symbol of the automaker’s deepening woes. The stoppage stems from a critical shortage of high-voltage batteries: supplier CATL was forced to temporarily shut its Hungarian factory in Debrecen over environmental compliance issues. To plug the gap, Mercedes is now shipping battery packs from China, adding six weeks to lead times. Missing wiring harnesses from a Moroccan supplier hit by floods have compounded the problem. By the end of May 2026, only around 3,300 units of the new electric GLC had reached customers, a fraction of the volumes rival BMW has achieved with its iX3.
Meanwhile, internal tensions have boiled over into the streets. On Friday, July 3, tens of thousands of workers demonstrated at eight German sites, from Sindelfingen to Berlin. The IG Metall union puts the nationwide turnout at 33,000; Mercedes counters with 10,000. The flashpoint is management’s decision to defer a tariff-based special payment — equivalent to 18.4% of monthly salary — until 2027, affecting roughly 90,000 employees. Added to that are talks about extending working hours without additional pay. The union has already announced a car cavalcade in Stuttgart for the coming week.
Even the performance division is feeling the heat. The current AMG C63 S E Performance, powered by a four-cylinder hybrid, has been rejected by the core customer base. AMG chief Michael Schiebe acknowledged that buyers miss the V8 roar. For the C-Class facelift next year, Mercedes is shifting to a six-cylinder mild-hybrid powertrain instead.
Should investors sell immediately? Or is it worth buying Mercedes-Benz?
At the bourse, the stock has been battered but showed a flicker of life on Friday, closing at €45.40, up 1.10% on the day and 4.91% for the week. That still leaves a 9.19% decline over the past 30 days and a year-to-date loss of 26.37%. The shares hit a 52-week low of €42.64 on June 29, far below the December peak of €62.30. Technical indicators remain weak: the 50-day moving average stands at €48.44 and the 200-day at €54.80, both well above the current price, while the RSI of 43.8 sits in neutral territory. Analysts at Jefferies, however, see a turnaround opportunity. They upgraded the stock from Hold to Buy, citing restructuring progress and a supportive margin outlook — though they trimmed the price target from €60 to €52, arguing that operational risks are already priced in.
First-quarter numbers underscore the damage. Revenue slipped 4.9% to €31.6 billion, earnings per share fell to €1.49 from €1.74, and sales in China — Mercedes' largest single market — collapsed 27%. The calendar offers two critical near-term milestones: a pre-close call with analysts on July 14, followed by the second-quarter interim report and another analyst call on July 28. Beyond the factory floor and the protest lines, investors will also watch for India’s new cybersecurity rules for automated vehicles, expected by October 2026 and directly affecting models such as the S-Class. For now, Mercedes is caught between a rebellious workforce and a breakdown in its supply chain — with the market waiting to see which crisis eases first.
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