BERLIN — German premium carmaker Mercedes-Benz reported a 22-percent rise in second-quarter (Q2) operating profit but flagged weakness in its core cars business on Tuesday, now forecasting a drop in overall sales due to problems in China. Mercedes, which like German peers Volkswagen and BMW, is facing mounting tariff costs and intensifying competition from Chinese rivals, also pledged to accelerate cost-cutting measures with a focus on its German plants. Group earnings before interest and tax came in at 1.5 billion euros ($1.71 billion), slightly below an average analyst estimate of 1.6 billion euros, according to a poll conducted by Visible Alpha. Mercedes now expects both sales of cars and group revenue to come in slightly below the prior-year level in 2026, having previous forecast a stagnation. The group result in the April-to-June period was supported by strong earnings at Mercedes’ financial services and vans units. It also benefited from a 131-million-euro gain linked to the planned sale of its leasing subsidiary Athlon. “Despite a demanding market environment, we remained on track in the second quarter while continuing to advance our product launch program,” CEO Ola Kaellenius said, vowing further cost-cutting measures in the second half of the year. Mercedes’ shares rose 5.6 percent following the results announcement.
