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The luxury car market, particularly in China, has experienced a seismic shift. Sales figures reveal that while total vehicle sales in China grew by 5% in 2024, the luxury segment—historically a stronghold for brands like Mercedes—saw a sharp decline. The advent of Chinese EVs is reshaping consumer preferences, diverting sales from traditional luxury competitors. Data indicates that in segments where quality Chinese EVs like those from Zika and XPeng have taken root, luxury sales for brands like BMW and Audi have plummeted.
Further compounding these issues, Mercedes-Benz experienced a particularly harsh environment in 2024, with a 31% decline in their EV sales in the third quarter alone.