Mercedes To Charge Customers More

Thu 5th May 2022

High demand for premium vehicles at a time when supply is low has allowed German manufacturer Mercedes-Benz put a premium on their prices, says the company’s Chief Financial Officer.

Pandemics, lockdowns, microchip shortages and the war in Ukraine have combined to create the perfect storm of low availability for most motor manufacturers and Mercedes are no different. But with the typical Mercedes customer being accustomed to getting what they want, even if they have to pay the price, the German company has put up their prices to offset the rises in raw materials and transport costs.

Speaking to the press this week to report the company’s Q1 results, Harald Wilhelm, CFO for the company said: “In terms of the desire of wealthy people to spend the money for exceptional products, I would say there is no barrier, there is no limit.”

Mercedes saw earnings rise to $5.54 billion in the first quarter, with a 16.4 per cent margin in cars. 

However, the ongoing crisis in the Ukraine and extended lockdowns in China are expected to hit motor manufacturing further. Some companies are also likely to be exposed by Russia stopping gas imports to Poland and Bulgaria.

Gas is required in the production of paint shops and also the main factory areas, but Germany, like many other countries is getting by on sustainable energy for their electricity.

"I can say from the news from yesterday with regards to a gas delivery stop to Poland and also Bulgaria there are no clear consequences for our plants in Germany, Jawor (Poland) or Kecksemet (Hungary).

“We are working on how to reduce demand, but also on changing the energy source as quickly as possible. An abrupt stop would have an impact on the industrial side,” Wilhelm said.