Mercedes-Benz celebrates 100 years of its brand as profit slumps and luxury-only strategy is rolled back

Exactly 100 years ago, on 28 and 29 June 1926, the merger of the companies founded by Carl Benz and Gottlieb Daimler created Daimler‑Benz AG and gave birth to the Mercedes‑Benz brand. The famous three‑pointed star inside a laurel wreath was registered as a trademark on 21 August that year, and the emblem has barely changed since. Today the brand ranks among the most valuable in the world, plastered on Formula 1 cars, stadiums and school bags, and name‑checked in songs by Miley Cyrus, 50 Cent and the late Janis Joplin.

Marketing’s luxury pivot beyond cars

Marketing chief Christina Schenck sees the brand as “the benchmark for progress – technologically, in design and in the entire customer experience.” Beyond mobility, the company is licensing its name for residential towers in Dubai and Miami. The projects are “a strategically relevant business field with which we create new emotional touchpoints for the brand,” Schenck said.

Mercedes‑Benz stands for pioneering spirit, excellent engineering and timeless, elegant design.

A strategy U‑turn on the factory floor

CEO Ola Källenius had pursued a pure luxury strategy, captured in the 2023 annual report: “Think and act as a luxury brand.” That language has disappeared. The focus on top‑end models – fewer cars, higher margins – failed to deliver, according to automotive economist Helena Wisbert of Ostfalia University. “Mercedes is a volume manufacturer, not a manufacture,” she said, adding that among premium competitors the marque still embodies luxury, prestige and status more than any other and has successfully differentiated itself from BMW and Audi over a long period.

Focusing on top models, on fewer cars but those with higher margins, did not work out well.

Profit collapse forces a rethink

Group profit nearly halved in 2025, tumbling from €10.4 billion to €5.3 billion. Management blamed tariffs, adverse exchange‑rate effects and fierce competition in China. The deterioration had already been visible in 2024, prompting a cost‑cutting programme whose details remain incomplete in the reporting. The numbers leave little room for the extravagant, high‑stakes luxury narrative that dominated just a year earlier.

What comes after the centenary

While the brand’s pull remains undeniable – from teenagers’ key chains to the glitzy residential towers now associated with the star – the Stuttgart‑based automaker faces a crossroads. The 100‑year anniversary finds it not only looking back but also recalibrating a strategy that once bet heavily on exclusivity. As the company trims costs and refocuses on volume segments, the coming quarters will show whether the balance between heritage, margins and scale can be restored.