Mercedes-Benz Q1 profit rises as pricing power and resilience offset headwinds


·       Profitability increased: Mercedes-Benz Cars adjusted Return on Sales in Q1 reaches 16.4% and Mercedes-Benz Vans adjusted Return on Sales 12.6%

·       Transformation accelerated: Top-end and electric vehicle demand surges, EQE launched and U.S. battery factory opened to supply EQS SUV

·       Milestones achieved: Vision EQXX sets benchmark with >1,000 kilometres range, Level 3 enters production

·       Healthy balance sheet: Free Cash Flow Industrial Business at €1,216 million, Net Industrial Liquidity reached €22,706 million

·       Outlook 2022: Guidance for Group KPI’s confirmed despite impact of geopolitical situation

Mercedes-Benz Group AG (ticker symbol: MBG) achieved strong financial results in the first quarter of 2022, boosted by pricing power, the sharpened focus on top-end vehicles and premium vans, combined with ongoing cost discipline. These measures helped to lift the adjusted Return on Sales at Mercedes-Benz Cars to 16.4% and to 12.6% for Mercedes-Benz Vans even as the COVID-19 pandemic, semiconductor supply-chain bottlenecks and war in Ukraine continued to impact business.

“In this challenging environment resilience and pricing power are crucial. Our sharpened focus on desirable top-end and electric vehicles, combined with ongoing cost discipline, allowed us to deliver strong earnings despite numerous headwinds,” said Harald Wilhelm, Chief Financial Officer of Mercedes-Benz Group AG. “On this foundation we continue to transform our business by growing the luxury business, scaling up production of electric vehicles and accelerating software development.”

Group EBIT rose 11% to €5.2 billion (Q1 2021: €4.7 billion). Earnings were impacted by a positive €918 million gain from the sale of Canadian own retail operations and the partial sale of MB Grand Prix, nearly offsetting €709 million in expenses tied to adjustments of industrial business activities in Russia and €281 million in expenses related to diesel vehicles.

In the wake of Russia’s attack on Ukraine, Mercedes-Benz suspended the export of passenger cars, vans and spare parts to Russia and halted local manufacturing. Furthermore, the company is in close contact with suppliers that have exposure to Ukraine with a view to safeguarding supply chains. This includes among other things, transferring production to other locations within the supplier network. Mercedes-Benz has adapted shift plans at some plants and taking advantage of its flexible manufacturing system to avoid downtime and maintain production.

Mercedes-Benz reasserted its claim to leadership in the electric era. In April, the Mercedes-Benz Vision EQXX demonstrated world-beating efficiency by driving more than 1,000 kilometres on a single charge under real-world conditions. The EQS SUV was presented and the EQE was launched in the market. That’s after Mercedes-Benz opened a new battery plant in the United States in the first quarter, as part of a broader push to ramp up global production of electric vehicles this year.

Mercedes-Benz Group*



Change 22/21









EBIT adjusted**




Net profit/loss**




Net liquidity (industrial business, March, 31)**




Free cash flow (industrial business)**




Free cash flow (industrial business) adjusted**




Earnings per share (EPS) in EUR




* from continuing operations

**in millions of €

Investments, free cash flow and liquidity

The free cash flow of the industrial business in the first quarter amounted to €1,216 million (Q1 2021: €1,297 million). The adjusted free cash flow of the industrial business was €1,210 million (Q1 2021: €2,505 million). The net liquidity of the industrial business amounted to €22,706 million (end of 2021: €21,005 million). The Group’s investments in property, plant and equipment in the first quarter totalled €855 million (Q1 2021: €1,186 million). Of this amount €0.8 billion (Q1 2021 €1.1 billion) was attributable to Mercedes-Benz Cars and €18 million to Mercedes-Benz Vans (Q1 2021: €29 million). Research & development expenditure amounted to €1,979 million (Q1 2021: €2,414 million) including important upfront investments in future products. At €1.9 billion (Q1 2021: €1.9 billion), Mercedes-Benz Cars accounted for a majority of the research and development expenditure. During the reporting period, Mercedes-Benz Vans had research and development expenditure of €84 million (Q1 2021 €119 million.)

Divisional results

Despite strong demand, sales at the Mercedes-Benz Cars decreased by 10% to 487,008 vehicles (Q1 2021: 538,869) mainly due to semiconductor supply bottlenecks, COVID-19 lockdowns as well as the war in Ukraine. Nonetheless, revenue rose 8% highlighting the pricing power and ability to improve product mix even in volatile markets. Deliveries of top-end vehicles, which include Mercedes-Maybach, Mercedes-AMG, G-Class, S-Class, GLS and EQS, rose 5% to 78,000 vehicles during the same period. Top-end vehicles now account for 16% of overall volume. Sales of Mercedes-Benz Cars hybrid and electric models rose 19% during the quarter to 74,000 vehicles.

This resulted in a 21% rise in adjusted EBIT to €4,243 million and an adjusted Return on Sales of 16.4%. The adjusted CFBIT decreased to €1.7 billion due to working capital effects caused mainly by semiconductor supply constraints as well as logistics issues related to Ukraine/Russia and China.