Mercedes-Benz announces price cuts and halts electric vehicle deliveries to the US, citing tax credit changes and shifting market dynamics. Analysts predict slower EV adoption in 2025.

Mercedes-Benz Slashes US EV Prices, Halts Deliveries as Market Faces Slowdown

German automaker recalibrates electric vehicle strategy in response to changing US policy and consumer trends

Mercedes-Benz has announced a sweeping move to cut prices of its electric vehicle (EV) models in the United States and temporarily suspend new deliveries, signalling a strategic shift as the American EV market faces headwinds.

The decision, revealed on Wednesday and confirmed by Reuters, comes as the automaker adjusts to a changing economic and policy environment, including reduced federal tax incentives for electric vehicles. The manufacturer said it will reduce inventories of EVs in the US and focus on supplying models built at its Tuscaloosa, Alabama plant.

Mercedes-Benz Electric Cars Affected by Policy and Pricing Pressures

Trump-era tax credit cuts reshape EV affordability landscape

The move follows recent developments in Washington, where a revised spending bill introduced under former President Donald Trump accelerated the phase-out of EV tax credits. The legislation has already begun to impact consumer sentiment, analysts say, with projections for the US electric vehicle market being revised downward.

With fewer federal incentives in place, the effective cost of electric vehicles has risen for many American buyers, placing added pressure on automakers to lower retail prices in order to remain competitive.

CEO Remains Optimistic Despite Challenging Outlook

American EV market seen as long-term opportunity

Mercedes-Benz CEO Ola Källenius addressed the decision in a press briefing on Wednesday, noting that while the US EV market is currently growing at a slower pace than anticipated, he remains confident in its long-term prospects.

“Despite the slower trajectory, we believe American consumers will continue to shift toward battery-electric vehicles over time,” Källenius said. The company, he added, is recalibrating its approach to better match local demand and regulatory frameworks.

Tuscaloosa Plant to Anchor US EV Supply Strategy

Focus shifts to domestic manufacturing as global brands adapt to local challenges

With the halt in overseas deliveries, Mercedes-Benz will concentrate on vehicles produced at its Alabama facility to meet any residual demand. The move is seen as part of a broader industry trend, as foreign automakers increasingly localize production in North America to better navigate tariffs, logistics costs, and shifting regulations.

While no timeline has been given for the resumption of international EV deliveries to the US, the company has not ruled out revisiting the decision as the market evolves.

 Mercedes-Benz Electric Cars Face a Crossroads in America

Pricing adjustments and policy shifts test automaker's US electric ambitions

As the US electric vehicle landscape undergoes a transformation, Mercedes-Benz is taking a cautious but calculated approach. By slashing prices and focusing on domestic production, the luxury automaker aims to stay aligned with evolving consumer expectations and regulatory changes. Whether these steps will help Mercedes-Benz electric cars gain a stronger foothold in the US market remains to be seen, but the strategy signals a new chapter in the brand's electrification journey.