Mercedes-Benz Launches All-Electric GLB Production in Hungary, Accelerating Eastward Shift to Counter Declining Profits

Mercedes-Benz has recently started production of the all-electric GLB SUV at its Kecskemét plant in Hungary, with a starting price of approximately €59,000. Originally manufactured in Mexico, production of this model is now gradually shifting to Hungary. Meanwhile, the Rastatt plant in Germany ceased production of the B-Class Estate at the end of last year. In the future, more models—including the electric C-Class—will also be moved to Hungarian production. Following its expansion, the Kecskemét facility will become Mercedes-Benz’s second-largest global production site. The company stated that manufacturing costs in Hungary are less than half those in Germany, and the plant complex includes an on-site battery factory, significantly shortening the supply chain. This strategic shift aims to address mounting profit pressures stemming from weakening demand in China, new U.S. tariffs, and intensifying competition from domestic Chinese EV makers. As a result, Mercedes-Benz’s automotive division margin has already dropped to 4.8% from its target of 8%. The automaker urgently needs new electric models to reverse its lagging position in electrification.