Mercedes-Benz Stops Deliveries of EQ Electric Vehicles in the U.S., Reduces Prices
Mercedes-Benz Pauses U.S. Sales of EQ Electric Vehicles
In a move to address slowing demand, high dealership inventories, and the upcoming expiration of U.S. federal EV tax credits, Mercedes-Benz has announced a temporary halt in U.S. deliveries of its current EQ electric vehicles, including the EQS and EQE sedans and SUVs, starting September 1, 2025.
The production pause affects all U.S.-bound EQE and EQS models, including their various trims. However, production of these EQ models will continue at the Tuscaloosa, Alabama plant for global markets, and vehicles produced before September 1 will still be delivered in the U.S.
To move existing inventory, Mercedes-Benz is implementing significant price reductions on EQE and EQS sedans and SUVs, ranging from 4% to 16%, for the 2026 model year. The base prices of the EQE and EQS models will exclude delivery fees.
The decision comes as the German automaker faces slowing EV demand, high dealership inventories, and the looming expiration of federal EV tax credits. Sales figures show a struggle for Mercedes' EQ lineup, with a 32% drop in EQS SUV shipments and a 35% drop in EQE crossover deliveries in the first half of 2025.
Some EQ models have taken over 100 days to sell, which is significantly longer than the industry average. Since Mercedes' EQ sedans are imported, they are not eligible for federal EV tax incentives unless leased, putting them at a further disadvantage compared to domestic EVs.
The production pause does not affect Mercedes' long-term belief in battery-electric vehicles, as reaffirmed by CEO Ola Källenius. Källenius acknowledged that adoption of battery-electric vehicles in the U.S. is progressing slower than expected. However, Källenius stated that he does not believe that BEV demand in the United States goes to zero.
Looking ahead, Mercedes plans to rebalance its lineup by introducing 19 new internal combustion engine vehicles alongside 17 new EVs by 2027, reflecting a strategic pivot after EV sales declined significantly. The automaker's production system remains flexible, allowing switching between electric, hybrid, and combustion-engine vehicles to adapt to changing market demands.
Mercedes-Benz has not provided a timeline for when production or deliveries might resume. The EQ sedan variants, assembled in Germany, will not be shipped to U.S. buyers for the time being due to the production pause. The company is working closely with dealers to adjust sales strategies amid this market shift.
References: 1. Mercedes-Benz pauses U.S. sales and deliveries of its current EQ electric vehicles 2. Mercedes-Benz cuts prices on EQE, EQS models to move inventory before tax credit expiration
- Despite the production pause, Mercedes-Benz continues to believe in the future of battery-electric vehicles, as demonstrated by the production of these models in global markets.
- In the face of slowing demand for electric-vehicles and high dealership inventories, Mercedes-Benz is implementing price reductions on EQ models for the 2026 model year, aiming to move existing inventory before the expiration of federal EV tax credits.
- The automotive industry, including the finance sector, is closely monitoring Mercedes-Benz's strategic pivot, with plans to introduce 19 new internal combustion engine vehicles alongside 17 new EVs by 2027, reflecting a shift in lifestyle preferences towards sustainable transportation solutions.
