Mercedes Boss Hands The Combustion Engine Another Lifeline
Mercedes has been teasing AMG's first in-house all-electric vehicle, a 1,000-horsepower-plus super sedan that will redefine Affalerbach's definition of an Autobahn animal. On the other end of the spectrum, the entry-level CLA has arrived with similarly brilliant all-electric technology, and the automaker had previously announced intentions for all its products to be EVs around the end of the decade. Those plans have continually shifted as demand has, and based on comments Mercedes CEO Ola Källenius recently made to German publication Auto Motor und Sport, they're seemingly shifting again. When asked if the decision to offer the GLC SUV as an EV and also with a hybridized combustion engine was a stopgap measure, Källenius responded, "The electrified, high-tech combustion engines will run longer than we originally expected. We have made this course correction."
The CEO added, "I believe the most rational approach in the current situation is for an established manufacturer to do both [EV and gas] and not neglect one technology." If those sorts of comments sound familiar, BMW CEO Oliver Zipse and Toyota Chairman Akio Toyoda have expressed similar sentiments, saying that focusing all one's resources on exclusively building cars that are not yet fully supported in terms of worldwide infrastructure and demand is simply implausible for any automaker that wishes to exist long enough to see global EV adoption take hold en masse. To be fair, Källenius hasn't just come to this realization now. Last year, he announced plans to move the EQS and S-Class under one nameplate, and Mercedes, like most of its peers, has always accompanied its all-electric goals with the condition that they are subject to market conditions. And let's face it, the market for new luxury EVs is not exactly booming.
"The new CLA is the greeting from the kitchen of an entire family," Källenius said. "Then the core segments will follow with the electric versions of the GLC, C-Class, and E-Class. We still have an incredible amount in the pipeline." As we touched on above, Mercedes is dropping the EQ "sub-brand," which was essentially a gamble based on the supposition that EV buyers wanted association with the Mercedes brand but also a unique identity. It was also a marketing ploy because Mercedes EQ models looked vastly different from traditionally named and powered Benzes, but the combination of a new name and jellybean styling led one dealer to tell Automotive News (subscription required) in 2023, "Our cars need to be 'want' cars. The S-Class has maintained good loylty because it's aspirational. An EQS is not something that most people aspire to own."
Källenius' comments indicate that, like BMW (which sells identically styled i7 EV and 7 Series sedans), future EVs will look similar to their combustion-powered counterparts, and those hybridized counterparts will now likely be sold well into the next decade. The shift in styling strategy has already begun. The all-electric G 580 with EQ Technology has a silly name, but it looks like the solid G-Wagen it is. Notably, Porsche is also now working on a new gas Macan after the EV's sales failed to sustain the nameplate, reports Autocar. In America, both the old gas and new electric Macan are sold concurrently, but in Europe, cybersecurity laws meant Porsche had to move on, and with the 718, too. Now, it may be returning to combustion, but have no doubt, more EQs and electric Caymans will still be developed.
Related: Genesis Is Going After BMW And Mercedes Where It Will Hurt Most
Copyright 2025 The Arena Group, Inc. All Rights Reserved.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
an hour ago
- Yahoo
This Top Warren Buffett Holding Could Outperform the S&P 500 in the Second Half of 2025, According to Certain Wall Street Analysts
Warren Buffett has consistently sold more stocks than he bought over the last 30 months. The biggest challenge is that many of the biggest companies in the market have high valuations and low expected returns. This investment is low-risk and offers good value right now. 10 stocks we like better than S&P 500 Index › Warren Buffett is widely regarded as one of the greatest investors of all time. He has a public track record of over 70 years to back that up, generating massive market-trouncing returns over that time. His company, Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) has continued to outperform the S&P 500 (SNPINDEX: ^GSPC) in 2025. That's despite the fact that Buffett's retirement announcement in May has somewhat deflated the premium investors are willing to pay for shares. That speaks to the strength of Buffett's portfolio of investments, including owned and operated businesses, marketable equities, private issues, and bonds. While Buffett expects everything his company buys to outperform over the long run (why else would he buy it?), one of Berkshire's biggest holdings looks particularly well-positioned to do so in the near term. That's backed up by analysis from Morgan Stanley's team of market analysts led by Lisa Shalett. Here's the Buffett investment that could outperform over the rest of the year. It's worth pointing out that Buffett has had a hard time identifying great opportunities in the stock market recently. Not only that, but he's consistently sold many of Berkshire's biggest marketable equity holdings, including Apple (NASDAQ: AAPL), Bank of America (NYSE: BAC), and Citigroup (NYSE: C). That said, Buffett hasn't said that he sees significant challenges developing at any of those companies. Apple notably remains Berkshire's largest marketable equity holding, accounting for about 21% of the portfolio. Bank of America remains third in line with more than 10% of the $283 billion portfolio invested in the bank stock. Buffett did cut Citi entirely, though. The challenge for Buffett in holding those stocks appears to be a matter of valuation. Apple's price-to-earnings ratio when Buffett made Berkshire's initial investment in the stock was between 10 and 11.3. Today, it trades for 31 times trailing earnings, and it consistently traded higher throughout the second half of last year. When it comes to bank stocks, Buffett has mentioned that the new accounting rules requiring banks to mark assets to market make it difficult to assess the financial reality of their balance sheets. As a result, he's less comfortable holding companies like Citi, and he's slowly selling off harder-to-value financial stocks. It's not just those three that Buffett's been selling. In fact, Berkshire's been a net seller of stocks for 10 straight quarters. Total sales during that period add up to more than $174 billion in excess of Berkshire's stock purchases. While some of that cash went toward paying a record corporate tax bill last year, the vast majority has gone into a single investment vehicle: short-term U.S. Treasury bills. Berkshire Hathaway held over $314 billion of U.S. Treasury bills as of the end of the first quarter. Morgan Stanley analysts think that's a smart place to stash cash in the current financial market environment. In fact, they think there's a good chance T-bills outperform the S&P 500 through the end of the year. One of the biggest reasons analysts think government bonds offer a better investment than the S&P 500 right now is that the premium investors get for taking on the risk of equities is extremely low. Shalett and her team say the equity-risk premium sits near a 20-year low. With the earnings yield (the inverse of the price-to-earnings ratio) on the S&P 500 sitting around 4.7%, that's not a lot higher than the 4.3% investors can receive on 10-year Treasuries. One-month to six-month yields also range between 4.1% and 4.3% as of June 25. Meanwhile, there seems to be a lot of risk involved with buying equities right now, considering the ongoing conflicts in the Middle East and unpredictable U.S. trade policies. Further supporting the short-term value of Treasury bills are proposed regulatory changes, says Shalett. The Federal Reserve proposed adjusting the supplementary leverage ratio for banks. If banks can take on more Treasury bills on their balance sheets, it should support a higher debt ceiling without a rise in interest rates (thus supporting the value of current bond issues). Additionally, the Genius Act supports the creation and issuance of stablecoins, which are typically backed by U.S. Treasuries, adding more bidders to the auction. But it's important for investors to keep in mind that these are short-term factors. The equity risk premium is unlikely to stay this low for very long, especially if the above factors and the Fed's plans to eventually lower the Fed Funds Rate push yields lower over time. Despite the fact that Buffett has more money in Treasuries than marketable equities right now, he'd still prefer Berkshire's money to go into stocks. "Berkshire shareholders can rest assured that we will forever deploy a substantial majority of their money in equities," Buffett wrote in his 2024 letter to shareholders. The challenge for investors is finding good value in the current market. That's an even bigger challenge for Buffett, who's not very interested in opportunities where he can only invest a few billion dollars. The good news for smaller investors is that small- and mid-cap stocks trade at much more attractive valuations than large-cap stocks. So, while the large-cap S&P 500 index doesn't look that attractive right now, there are plenty of opportunities among smaller companies. Before you buy stock in S&P 500 Index, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and S&P 500 Index wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $713,547!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $966,931!* Now, it's worth noting Stock Advisor's total average return is 1,062% — a market-crushing outperformance compared to 177% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 23, 2025 Bank of America is an advertising partner of Motley Fool Money. Citigroup is an advertising partner of Motley Fool Money. Adam Levy has positions in Apple. The Motley Fool has positions in and recommends Apple, Bank of America, and Berkshire Hathaway. The Motley Fool has a disclosure policy. This Top Warren Buffett Holding Could Outperform the S&P 500 in the Second Half of 2025, According to Certain Wall Street Analysts was originally published by The Motley Fool Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Yahoo
an hour ago
- Yahoo
Big News for Roku Investors (and It's Exactly Why I Decided Against Selling)
Roku is trying to provide an advertising capability that few (if any) have ever been able to offer. However, the platform doesn't seem to have impressed advertisers in recent years, This is a troubling trend that needs to soon change in order to jump-start the business. 10 stocks we like better than Roku › There are multiple reasons to believe that stocks are overvalued right now, generally speaking, motivating me to move on from some old duds in my portfolio. For starters, consider the market for initial public offerings (IPOs). Companies usually wait to go public until market conditions heat up. High stock valuations allow IPO companies to raise more money. After below-average IPO years in 2022, 2023, and 2024, this year is shaping up to be above-average for new listings. The rise in IPO stocks in 2025 suggests that stock market valuations are high. And this suggestion can be corroborated further. According to YCharts, the price-to-earnings (P/E) ratio for the S&P 500 is 28, well above its 10-year average of 25. Some investors may use this information to "time the market," selling all of their stocks. I believe that's the wrong takeaway -- there's no telling what will happen with the market next. But for me, I have stocks in my portfolio that I'd like to move on from. In my view, now is as good a time as any to sell these, considering the stock market is potentially overvalued. I recently gave connected-TV platform company Roku (NASDAQ: ROKU) a hard look. I started buying shares in 2020 and continued buying into 2022. My entire position is down about 15% as of this writing, even though the S&P 500 has risen dramatically during my holding period. But I ultimately decided to keep holding for one key reason. It's early. But so far, I'm happy with my choice. On June 16, Roku secured a deal with Amazon (NASDAQ: AMZN). And it underscores why I still haven't sold Roku stock yet. For eight consecutive quarters, Roku has sold its hardware devices at a gross loss -- it sells them for less than it costs to make them. It does this because it's more interested in taking market share and becoming an advertising-technology (adtech) titan in connected TV (CTV). When it comes to adtech, TV screens are the most desirable advertising medium, and Roku powers TVs in over 90 million households. Not only is the video format attractive to advertisers, but Roku has an interesting value proposition: It can "close the loop" in advertising. Over the years, Roku has struck some interesting partnerships with companies such as Kroger, Walmart, and Cox Automotive. Take the Cox Automotive partnership for illustration. It owns the popular Kelley Blue Book platform. Through the partnership, Roku can show marketers how viewers are really responding to vehicle ads. If they see an ad and then head over to Kelley Blue Book for better info, that's an important data point for advertisers. In this scenario, Roku and Cox Automotive work together to close the loop as much as possible. Roku's partnerships with Kroger and Walmart can do similar things. Consumer brands could advertise on Roku, know who saw an ad, and know whether they bought anything at Kroger or Walmart as a result. Assuming Roku can demonstrate a high return on advertising spending, demand for its platform should soar, allowing it to command better advertising rates. Now Roku is partnering with Amazon, and the potential is similar. Amazon is the largest e-commerce company in the world and perhaps knows more about consumers than any other retailer. This makes Amazon's advertising solutions quite popular and explains how its ads business scaled so quickly. Through the new partnership, Roku and Amazon hope to deliver a win-win. It's a potential win for Roku because advertisers will have data from Amazon and can better target Roku's viewers. It's a potential win for Amazon also because (in spite of investors' concerns about Amazon's Fire TV) Roku remains the top player in the space. In short, I believe Roku's partnership with Amazon is big news for investors, and it's exactly the kind of news that's kept me as a shareholder. But allow me to contextualize the news a little more. Roku's potential has been sky-high, but it has, nevertheless, been a disappointment in recent years. Roku generated higher average revenue per user (APRU) in 2022 than it did in 2024. And management doesn't even break out this metric anymore, suggesting the numbers are still disappointing. But viewership has increased dramatically. This alone should have lifted ARPU. The only logical explanation is that advertising demand simply hasn't grown as it should, in spite of what Roku's adtech capabilities can theoretically provide. Roku's partnership with Amazon is expected to officially launch before the end of the year. If the partnership can't materially improve Roku's monetization at some point in 2026, then I don't know what will. Failure to see a substantial improvement with Roku at some point in 2026 could suggest it's finally time to move on from this once-promising stock. Before you buy stock in Roku, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Roku wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $713,547!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $966,931!* Now, it's worth noting Stock Advisor's total average return is 1,062% — a market-crushing outperformance compared to 177% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 23, 2025 John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Jon Quast has positions in Roku. The Motley Fool has positions in and recommends Amazon, Roku, and Walmart. The Motley Fool recommends Kroger. The Motley Fool has a disclosure policy. Big News for Roku Investors (and It's Exactly Why I Decided Against Selling) was originally published by The Motley Fool Sign in to access your portfolio
USA Today
an hour ago
- USA Today
Max Verstappen knocked out of Austrian Grand Prix on first lap crash
SPIELBERG, Austria ― Max Verstappen suffered his first retirement of the Formula One season on Sunday after a collision with Mercedes' Kimi Antonelli on the opening lap of Red Bull's home Austrian Grand Prix. The four-times world champion had started seventh on the grid, with Italian rookie Antonelli ninth, at a circuit where he has won a record five times. Antonelli, who clearly caused the Turn Three collision, also retired and the safety car was deployed. "I'm out, I got hit like crazy," Verstappen, third in the championship going into the race, said over the team radio. "Sorry about that, I locked the rear," Antonelli told his team. Here's the video of Kimi taking Max out.. :/ The retirement ended a run of 31 grands prix in the points for the Dutch driver, whose fans throng in their thousands to the Red Bull Ring. The race had started later than scheduled after Carlos Sainz's Williams was stuck on the grid as cars moved away for the formation lap. Sainz eventually got going and returned to the pitlane, where his car's brakes caught fire before being extinguished by mechanics with smoke still billowing out as he was pushed back and into retirement.
