Auto Dealers Urge Mercedes-Benz to Revise Business Policies Amid Profitability Crisis

The China National Federation of Industry and Commerce (CNFIC) Automobile Dealers Association recently issued a public appeal urging Mercedes-Benz’s manufacturer to directly address dealers’ concerns and promptly optimize its commercial policies. According to the association, since late 2025, numerous authorized Mercedes-Benz dealers have reported mounting operational pressures stemming from excessive inventory, price inversions (selling below cost), delayed rebate payments, overly stringent performance targets, and lack of compensation for dealers exiting the network. The association sent a letter to Mercedes-Benz China in December 2025 and followed up with two additional letters to Mercedes-Benz’s global headquarters in January 2026, proposing measures such as maintaining inventory-to-sales ratios below 1.0, improving the rebate mechanism, setting realistic sales targets, and establishing a compensation framework for dealers withdrawing from the network. Although Mercedes-Benz has responded, acknowledging the concerns, no substantive resolution has yet been achieved. As Mercedes-Benz marks its 40th anniversary in the Chinese market this year, the association urges the brand to take swift and effective action—prioritizing the health of its dealer network and long-term sustainable development—to foster a more resilient and balanced market ecosystem in China.