Mercedes-Benz is strategically increasing its inventory in the U.S. ahead of new tariffs set to take effect on April 3, 2025, according to an analyst call summary. The company is ramping up stock both at wholesale levels and at dealer lots to mitigate the impact of these tariffs, analysts noted from a call with the company’s executives.

Mercedes-Benz executives hinted that the company is observing competitor pricing strategies, suggesting that pricing decisions will depend on how rivals respond once tariffs are enforced. The German automaker is preparing for a potential 25% tariff on imported vehicles, which is expected to reduce its margin by 2.5 percentage points on a gross basis, before any cost-saving measures are implemented.

The company’s upcoming first-quarter financial results are anticipated to meet full-year expectations, with analysts projecting earnings of €1.57 billion ($1.70 billion) on a margin of 6.4%. However, sales in the first quarter have slightly declined compared to last year, primarily due to weaker demand in Europe and China.

In 2024, Mercedes-Benz sold 374,000 vehicles in the U.S., making up 15.6% of its total global sales. While carmakers, including Mercedes-Benz, are evaluating whether and how to adjust vehicle prices in response to the new tariffs, they remain cautious about revealing their plans due to concerns over potential backlash from U.S. President Donald Trump, who has expressed a strong preference for automakers to shift production to the U.S.

Mercedes-Benz has not yet commented on the details of its tariff strategy. The investor call took place ahead of the company’s closed period before its annual results are announced on April 30, 2025