Hampered by weak business in the key Chinese market, German luxury carmaker Mercedes-Benz reported a sharp drop in profits in early 2025.

The company reported a 43% drop in net profit for the first quarter compared to the same period last year, to €1.73 billion, AFP reported.

Revenue fell 7.3% to 33.2 billion yuan due to the global decline in car sales. Operating profit fell by almost 41% to €2.29 billion, reflecting ongoing market challenges.

Mercedes-Benz also warned of a potentially significant impact on profitability from the recently imposed tariffs on imports into the US.

However, the company said it was still difficult to assess the exact impact on demand due to the changing situation and possible retaliatory measures. | BGNES