Mercedes-Benz's Ludwigsfelde Sale Stalls as Cost-Cutting Standoff Deepens
Published on 09/28/2026 at 11:41 | Editorial boerse-global.de
Mercedes-Benz's effort to reshape its German manufacturing footprint has run into fresh trouble, with the planned handover of its Ludwigsfelde van plant to defense contractor KNDS now delayed and, according to industry sources, at risk of collapsing altogether. The uncertainty casts a shadow over the factory near Berlin and its roughly 1,800 employees.
Talks between the carmaker and KNDS are said to be broadly advanced, with the arms manufacturer weighing either a full takeover of the site or use of part of its capacity. But the order that was meant to underpin the deal — expected as early as the start of the year — has yet to materialize, and both the procurement process and the final volume remain unresolved. Should the contract come in below expectations, KNDS has concluded it simply would not need the Brandenburg halls. Stuttgart had treated the transaction as its preferred route to preserving as many jobs as possible at the location; without a viable agreement, the automaker would have to devise alternative uses or, in the worst case, wind the plant down.
Savings Target of 800 Million Euros Fuels Unrest
The Ludwigsfelde limbo compounds an already fraught situation across Mercedes-Benz's German network, where management is negotiating with IG Metall over cuts to labor costs to keep its three assembly and seven powertrain plants in the country competitive. According to WirtschaftsWoche, the company aims to trim German labor costs by 800 million euros — a figure that has stirred considerable unease among the workforce, with the group's leadership so far declining to comment officially on the reported number.
Longer hours without extra pay are among the options on the table, alongside speculation about changes to, or the outright elimination of, existing bonus payments. The push follows pointed remarks from production chief Michael Schiebe, who told a works meeting in Sindelfingen that keeping every German site running remains the goal but is contingent on cost concessions. Ahead of the talks, the company had warned that absent agreement on a savings package, one German assembly plant and one German powertrain facility could be shuttered.
Should investors sell immediately? Or is it worth buying Mercedes-Benz?
Tariffs, China and a Stock Near Its Low
External pressures are adding to the strain. US import tariffs weighed on the balance sheet for the 2025 financial year to the tune of more than 1.1 billion US dollars. On September 16, Berenberg lowered its price target on Mercedes-Benz from 56 to 52 euros while keeping a "Hold" rating, citing a lack of near-term catalysts along with persistent headwinds from the Chinese market, geopolitical uncertainty and broad inflationary pressure.
The company has sought to shore up the equity story through its own measures. After announcing the launch of a share buyback at the end of August, it repurchased 1,606,805 of its own shares on the market between September 1 and September 11.
Management is also tightening internal working rules: a draft proposal would require employees to be in the office up to four days a week, while supervisory board chairman Martin Brudermüller has advocated extending the working week to 40 hours at unchanged pay to bring unit labor costs closer to international rivals.
The market has taken little comfort from any of it. At a current price of 41.56 euros, the stock sits just above the 52-week low of 41.05 euros touched on Friday, and shareholders have seen losses of 31 percent since the start of the year. Whether the exit from Ludwigsfelde succeeds — or brings further burdens — now rests with the Bundeswehr's procurement office.
Ad
Mercedes-Benz Stock: New Analysis - 28 September
Fresh Mercedes-Benz information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.
