In its TV and social media commercials, German automaker Mercedes-Benz (DDAIF) famously sells its luxury vehicles under the tagline "The Best or Nothing," which signifies the brand's rock-solid reputation for building some of the most desirable cars out on the road.
But while the brand's plushy sedans, powerful sports cars, and towering SUVs have proven to be winners for the three-pointed star, customers with the means to shell out for Mercedes have turned up their noses at one particular offering from the brand: electric vehicles.
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In October 2023, American Mercedes dealers complained that they had difficulty selling the six-figure EQS sedan, noting that its 'jellybean shape' turned off customers who wanted 'aspirational' cars.
Last year, the brand promised its North American dealers that it would provide its customers a 'balanced' portfolio of powertrains, shifting away from an aggressive EV strategy to a play that includes gas-powered cars and hybrids alongside electric offerings.
Although Mercedes struggled to get a foothold in the electric vehicle space, it isn't done with EVs yet.
Mercedes retools its EV strategy
According to a new report from Automotive News Europe, Mercedes-Benz will offer its upcoming models in electric and gas-powered versions.
The automaker's new electric models will no longer use the "EQ" designation. A Mercedes spokesperson confirmed that future models will incorporate "EQ Technology" for EVs and "EQ Hybrid Technology" for plug-in hybrids.
For example, the electric version of the new Mercedes CLA, which is set to be released later this year, will be called the "CLA with EQ Technology."
"We are strengthening our traditional class logic and will no longer use 'EQ' in model nomenclature for new vehicles," the spokesperson told AutoNews.
Related: Mercedes is seeing the writing on the wall with its EVs
The name change for its electric models represents a significant shift from Mercedes's old strategy. When Mercedes began marketing its EVs, it created an EQ sub-brand to distinguish its electric and gas-powered offerings.
Mercedes' EQ cars looked significantly different from normal, gas-powered Mercedes cars, but some of the EVs had asking prices that neared close to six figures.
By October 2023, the strategy was showing its flaws. Edmunds data at the time showed that competitors BMW and Audi respectively took an average of 38 and 46 days to move electric vehicles off their lots, while Merc electric vehicles sat on dealer lots for an average of 82 days. One frustrated dealer noted that Mercedes' electric models lacked what they called the "lust factor" of the brand's gas-powered flagship cars, like the S-Class sedan and the AMG-GT sports car.
"Our cars need to be 'want' cars," they told AutoNews. "The S-Class has maintained good loyalty because it's aspirational. An EQS is not something that most people aspire to own."
Mercedes-Benz
To appeal to stuffy old-money types, the EQS received a significant redesign for the 2025 model year, swapping some of the more brash styling elements for more conservative ones, including an S-Class-styled three-bar grille and a proper Mercedes hood ornament.
In its investor presentation on its capital markets day, Mercedes committed to producing a variety of products with different powertrain types and continuing to develop gas engines for its cars, noting that its portfolio will incorporate a "coherent design language" that will allow both electric and BEV and "electrified high-tech" gas cars to "exploit their respective strengths, without sacrificing space, elegance, convenience or efficiency," all while keeping a close eye on its expenditures and manufacturing flexibilities.
In a statement at the event, Mercedes CEO Ola Kallenius noted that the company is "staying the course" with its Vs but also noted that companies like it need to adapt to their customers' unique needs.
"But if the world changes, you have to adapt. That is what we're doing on the BEV/ICE dual track," he said.
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Mercedes-Benz starts road testing first solid-state-battery vehicle
Mercedes-Benz
Mercedes EV and F1 engineers develop promising EV tech
Despite the change in strategy, Mercedes is still committed to being on the cutting edge of electric vehicle technology.
In collaboration with Factorial Energy, engineers from both Mercedes-Benz and Mercedes AMG High Performance Powertrains (HPP), the engine manufacturers powering the Mercedes-AMG Petronas F1 Team, developed a solid-state battery that is expected to deliver a range of more than 620 miles on a single charge.
"Developing an automotive-scale solid-state battery underlines our commitment to innovation and sustainability," Mercedes-Benz Development & Procurement Chief Technology Officer Markus Schäfer said in a statement.
"We're therefore excited to announce that we've started road testing with a prototype vehicle equipped with this advanced technology. We will gain crucial insights into possible series integration of this cutting-edge battery technology."
Mercedes says that the new energy storage technology offers a 25% increase in range compared with an equivalent-sized lithium-ion battery. The automaker is currently road-testing an experimental vehicle equipped with the new battery, and the first production models are expected to hit the roads by 2030.
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