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Stellantis Q3 2026 Results: Revenue Rises to €37.6 Billion as Automaker Pushes Ahead With Turnaround Plan

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Stellantis has reported a modest increase in revenue for the third quarter of 2026, as the automotive group continues to implement its FaSTLAne 2030 strategy and accelerate efforts to improve profitability. Net revenues reached €37.6 billion, up 1% year over year, while the company significantly reduced its quarterly net loss and reaffirmed its financial outlook for 2026.

The group, which owns brands including Jeep, Ram, Fiat, Peugeot, Citroën, Opel, Alfa Romeo, Maserati, and Dodge, is attempting to strengthen its competitive position across major markets while addressing operational challenges, regional sales declines, and rising costs.

CEO Antonio Filosa said the company was making progress with its strategic plan, new product launches, manufacturing improvements, and a rapidly expanding cost-saving initiative. Stellantis also reiterated its expectation of achieving positive industrial free cash flow in 2027.

Stellantis Revenue Reaches €37.6 Billion in Q3 2026

Stellantis generated €37.6 billion in net revenues during the third quarter of 2026, representing a 1% increase compared with the same period last year. Growth in Enlarged Europe and South America helped offset weaker performance in North America, the Middle East and Africa, and Asia Pacific.

Both Enlarged Europe and South America recorded 3% year-over-year revenue growth. In Europe, the improvement was supported by higher shipment volumes, while South America benefited from stable volumes and favorable foreign exchange movements.

North American net revenues declined 3%, primarily because of lower volumes associated with planned production downtime. The Middle East and Africa region experienced a steeper 19% decrease, while Asia Pacific revenues fell 7%.

Despite the modest revenue increase, Stellantis reported a net loss of €500 million for the quarter. However, this represented a 90% improvement compared with the third quarter of 2025, when the results were affected by significant financial items.

Adjusted operating income reached €300 million, producing an adjusted operating margin of 0.7%. Although the improvement signals progress in the company’s recovery efforts, the relatively narrow margin highlights the challenges Stellantis still faces in restoring sustainable profitability.

Industrial free cash flow remained negative at €4 billion, although this represented a €300 million improvement compared with the same period last year.

FaSTLAne 2030 Strategy Targets Profitability and Cost Reductions

The FaSTLAne 2030 plan remains central to Stellantis’ efforts to improve financial performance, streamline operations, and align production with customer demand.

One of the strategy’s main priorities is the Value Creation Program, which is designed to deliver €6 billion in annualized cost efficiencies. Stellantis expects to have implemented at least 40% of the targeted run-rate savings by the end of 2026.

The company expects the program to generate several hundred million euros in additional savings during the fourth quarter of 2026, approximately double the amount achieved in the third quarter.

Stellantis is also focusing on inventory management, production planning, and working capital improvements. Total consolidated shipment volumes are expected to increase in the fourth quarter compared with the previous three-month period, while North American inventory levels are projected to converge toward December 2025 levels by the end of 2026.

Management expects pricing conditions to remain broadly stable during the final quarter of the year. However, the company continues to face cost pressures from memory chips and recall-related expenses.

Full-year net tariff costs are estimated at €1 billion, with €600 million already incurred through September. Stellantis also expects approximately €1.6 billion in full-year cash outflows related to charges recorded during the second half of 2025.

Capital expenditure and research and development spending are projected to represent 6.5% of full-year net revenues, consistent with the company’s investment strategy.

Despite these pressures, Stellantis has reaffirmed its 2026 financial guidance and maintained its target of generating positive industrial free cash flow in 2027.

North America: Ram Leads Market Share Gains

North America delivered a mixed performance, with sales increasing 1% year over year despite slightly weaker results in the United States and Canada.

Sales declined 0.3% in both the United States and Canada, while Mexico recorded a substantial 24% increase, rising to 28% when Leapmotor is included.

In the United States, Stellantis outperformed the overall industry, which contracted 0.8% during the quarter. Several models delivered encouraging results, including the Ram 1500, whose sales increased 73% year over year. The Dodge Durango grew 14%, while the Chrysler Pacifica recorded a 6% increase.

The region’s market share rose to 7.5%, up 0.1 percentage points compared with the third quarter of 2025.

Ram was a particularly important contributor to the improvement. The brand increased its North American sales by 30% year over year, benefiting from its expanding product and powertrain offerings.

The results suggest that Stellantis’ strategy of strengthening its core truck and SUV businesses is beginning to deliver benefits in one of its most important markets. Nevertheless, the company must maintain that momentum while managing production levels, inventory, and operating costs.

Europe: Electric Vehicle Sales Surge 65%

Europe remained a key market for Stellantis, particularly as demand for battery-electric vehicles continued to expand.

Sales across the EU30 markets increased 1% year over year, rising to 6% when Leapmotor is included. The Smart Car program was a major contributor, recording 36% growth, while demand for battery-electric vehicles strengthened in France, Germany, and the United Kingdom.

Stellantis reported a particularly strong performance in electric passenger cars. EU30 battery-electric passenger car sales increased 65% year over year, or 93% including Leapmotor. Battery-electric light commercial vehicle sales rose 46%.

Despite the growth in overall sales and electric vehicles, Stellantis’ EU30 market share declined to 14.8%, down 0.6 percentage points year over year. Including Leapmotor, the figure reached 15.6%, representing a smaller decline of 0.1 percentage points.

The company retained its leading position in the European light commercial vehicle market, with a 26.9% share. However, this was 1.1 percentage points lower than a year earlier.

Stellantis is looking to reinforce its commercial vehicle business with the expansion of its Pro One lineup, including the affordable Smart Car Compact Van.

Leapmotor also continued to gain traction in Europe, with sales increasing to nearly four times their level in the same period of 2025. The partnership gives Stellantis another route into the increasingly competitive market for affordable electric vehicles.

Despite these positive developments, Europe was the weakest major region for Stellantis’ adjusted operating margin, which declined by 3.4 percentage points year over year. The contrast between growing electric vehicle sales and weaker operating profitability highlights the importance of pricing, product mix, and cost control.

South America: Fiat and Ram Support Regional Leadership

South America remained one of Stellantis’ strongest markets in terms of competitive positioning, even as regional sales declined.

Sales fell 4% year over year, narrowing to a 2% decline when Leapmotor is included. Stellantis maintained its regional leadership, securing an 18.6% market share, or 18.9% including Leapmotor.

Brazil and Argentina continued to be particularly important markets. Stellantis held a 25.1% share in Brazil and 25.3% in Argentina. Including Leapmotor, those figures increased to 25.5% and 25.6%, respectively.

Several models delivered solid year-over-year sales growth during the quarter. The Fiat Strada increased 13%, while the Fiat Toro recorded a stronger 26% gain. The Fiat Pulse grew 20%, and Ram sales increased 33%, supported by the all-new Ram Dakota.

These results demonstrate the importance of locally relevant vehicles, including pickup trucks and compact utility models, to Stellantis’ regional strategy.

Although the group experienced a decline in sales and a slight deterioration in adjusted operating margin, South America continues to provide a substantial market presence and a strong position in key vehicle segments.

Middle East and Africa: Sales Fall Amid Market Challenges

The Middle East and Africa region faced a more difficult quarter, with sales declining 22% year over year and net revenues falling 19%.

Stellantis recorded a regional market share of 10.1%, down 1.5 percentage points compared with the third quarter of 2025. The decline occurred against an 11% contraction in the overall regional automotive market.

However, the group maintained a strong position in light commercial vehicles, where it achieved a 21.8% market share, an improvement of 2.4 percentage points year over year.

Türkiye was a major factor behind the weaker performance. Difficult market conditions were compounded by a temporary product transition, including the phase-out of the Fiat Egea ahead of the introduction of the all-new Fiat Grizzly.

The start of local production of a small van in October is another part of the company’s effort to strengthen its regional offering.

The upcoming product launches could help Stellantis recover some lost ground, although the timing and scale of any recovery will depend on market conditions and the successful execution of its product strategy.

Asia Pacific: Weak Sales Continue as New Partnerships Take Shape

Asia Pacific remained Stellantis’ smallest and one of its most challenging major regions.

Sales fell 27% year over year, narrowing to a 22% decline when Leapmotor is included. The decrease was driven primarily by weaker performance from the Citroën C5 X.

The group’s regional market share slipped to 0.2%, down from 0.3% in the third quarter of 2025.

Despite the disappointing sales figures, Stellantis continued to make strategic investments in the region. Malaysian production of the Leapmotor C10 and B10 began during the quarter, potentially strengthening the group’s access to regional electric vehicle markets.

The company also established Dongfeng Stellantis Automotive Technology (Wuhan) Co., while Dongfeng Peugeot Citroën Automobile completed a shareholder loan-to-equity conversion in September 2026.

The restructuring is intended to support the development and expansion of two new Jeep models and two new Peugeot models.

These initiatives reflect Stellantis’ efforts to rebuild its position in Asia through local production, partnerships, and a broader range of vehicles. However, the latest figures show that the company still has considerable ground to recover in the region.

What Stellantis’ Q3 2026 Results Mean for Its Automotive Future

Stellantis’ third-quarter results present a mixed picture. Revenue growth remains modest, industrial free cash flow is still deeply negative, and adjusted operating profitability remains limited. At the same time, the sharp reduction in net losses, improving results in North America, and accelerating cost-saving initiatives suggest that the company is making progress toward stabilizing its financial performance.

Electric vehicle growth in Europe is another encouraging sign, while the performance of Ram in North America and Fiat in South America demonstrates the value of strong regional brands and established product segments.

However, the pressure on European margins, declining market shares in several regions, and weak performance in Asia Pacific underline the scale of the turnaround still required.

For the remainder of 2026, Stellantis will focus on increasing shipments, maintaining inventory discipline, controlling costs, and delivering the next phase of its Value Creation Program. The company must also balance these efforts with continued investment in new vehicles, electrification, research, and development.

The most important milestone will come in 2027, when Stellantis expects to achieve positive industrial free cash flow. Meeting that target would represent a significant step toward restoring financial stability and giving the company greater flexibility to invest in its brands and future products.

For now, the third-quarter results indicate that Stellantis is moving in the right direction, but the success of its FaSTLAne 2030 strategy will ultimately depend on turning cost savings and operational improvements into stronger, sustainable profitability.

Source: Stellantis

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Porsche Reports Higher Profit and Stronger Cash Flow in First Nine Months of 2026 Despite Falling Sales

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Porsche has reported an improvement in profitability and automotive net cash flow for the first nine months of 2026, despite a challenging global economic environment and a significant decline in vehicle deliveries. The German sports car manufacturer generated €25.28 billion in revenue, down 5.9% from €26.86 billion during the same period last year, while operating profitability improved substantially as the company continued implementing its strategic realignment.

The results highlight Porsche’s renewed focus on financial discipline, cost reduction and long-term profitability under its Sportwagenschmiede ’35 strategy. Although customer deliveries declined by 16%, the company improved its operating return on sales, strengthened its cash position and confirmed its financial outlook for the full 2026 financial year.

Porsche Improves Profitability as Deliveries Decline

Between January and September 2026, Porsche delivered 178,532 vehicles to customers, compared with 212,509 during the first nine months of 2025. Despite the reduction in sales volume, the company managed to limit the decline in revenue to a considerably smaller percentage, reflecting its focus on value-oriented sales management and balancing supply with demand.

Porsche’s Group operating return on sales climbed to 6.9%, compared with just 0.2% in the previous year. However, the comparison must be viewed in context: the first nine months of 2025 included approximately €2.7 billion in costs associated with the company’s strategic realignment, compared with around €500 million recorded during the corresponding period in 2026.

The Automotive EBITDA margin also improved, reaching 17.3% against 11.9% a year earlier.

Porsche CEO Dr Michael Leiters said the company was implementing its strategic realignment consistently, concentrating on its core business, a more competitive cost structure and sustainable improvements in profitability.

The strategy aims to create a leaner and more agile organisation while strengthening the appeal of Porsche’s product portfolio. New products will remain central to the company’s future, but management intends to combine investment in emotionally engaging sports cars with lower capital intensity and stronger cash generation.

Automotive Net Cash Flow Rises to €2.5 Billion

One of the most significant improvements in Porsche’s financial performance was the increase in Automotive net cash flow, which reached €2.50 billion during the first nine months of 2026. That represents a substantial increase from €1.34 billion in the same period last year.

The Automotive net cash flow margin rose to 11.3%, compared with 5.6% in 2025. Porsche’s Automotive net liquidity also strengthened, increasing by €884 million from the end of the 2025 financial year to €8.23 billion as of September 30, 2026.

A major contributor to the improvement was the completed sale of Porsche’s stakes in Bugatti Rimac and the Rimac Group. The transaction generated a cash inflow of €984 million and a gain of €593 million, significantly influencing the group’s financial result.

Nevertheless, several one-off costs weighed on cash flow during the third quarter. These included between €100 million and €200 million related to the strategic realignment, €250 million allocated to the further financing of pension obligations and €200 million in charges associated with US tariffs.

Porsche’s finance and IT executive board member, Dr Jochen Breckner, described the results as evidence of the company’s financial resilience. He highlighted the combination of a solid operating result, strong net cash flow and a robust balance sheet as important foundations for continuing the restructuring programme.

North America Remains Porsche’s Largest Market

North America continued to be Porsche’s largest sales region during the first nine months of 2026, accounting for 56,088 vehicle deliveries.

China, meanwhile, remained a challenging market for the German manufacturer. Porsche continues to prioritise its long-term brand positioning and profitability in the country rather than pursuing higher sales volumes at the expense of value.

This approach reflects the company’s broader “Value over Volume” strategy, which places greater emphasis on pricing discipline, product positioning and sustainable returns than on maximising deliveries.

The decline in overall deliveries also affected the proportion of battery-electric vehicles in Porsche’s sales mix. Battery-electric vehicles accounted for 21.7% of deliveries during the first nine months of 2026, down from 23.1% a year earlier.

The higher electric-vehicle share in 2025 was partly attributable to the strong sales ramp-up of the all-electric Porsche Macan. The latest figures underline the challenges of managing the transition to electric mobility while responding to different customer preferences and market conditions across regions.

Porsche’s full-year forecast nevertheless anticipates an Automotive battery-electric vehicle share of between 24% and 26%, suggesting that the company expects the proportion of electric models to increase during the final quarter.

Porsche Continues to Streamline Its Business Portfolio

Beyond its financial results, Porsche made further progress in reshaping its business structure during the third quarter.

In August, Porsche agreed to sell its wholly owned management and IT consultancy subsidiary, MHP, to Tata Consultancy Services (TCS). The companies are also planning a strategic collaboration focused on digital solutions and artificial intelligence.

The partnership is intended to accelerate the development, deployment and integration of AI applications across key business areas. Completion of the transaction remains subject to several closing conditions and is expected within the following 12 months.

Porsche classified the assets and liabilities associated with the planned sale as held for sale as of September 30, 2026, in accordance with IFRS 5 accounting requirements.

The planned MHP transaction forms part of Porsche’s wider effort to focus its resources on its core automotive business while pursuing opportunities to improve operational efficiency through technology and digitalisation.

The completed sale of its Bugatti Rimac and Rimac Group stakes represents another important step in this portfolio realignment, releasing capital and contributing to the improvement in Automotive net cash flow.

Porsche Confirms Its 2026 Financial Forecast

Despite ongoing economic uncertainty, geopolitical risks and pressure in key automotive markets, Porsche has confirmed its financial outlook for the full 2026 financial year.

The company’s projections take into account the cash inflow from the sale of its Bugatti Rimac and Rimac Group stakes, as well as the additional €250 million contribution towards pension obligations.

Porsche’s financial targets for 2026 are as follows:

  • Group sales revenue: €35 billion to €36 billion.
  • Group operating return on sales: 5.5% to 7.5%.
  • Automotive net cash flow margin: 5.5% to 7.5%.
  • Automotive EBITDA margin: 15% to 17%.
  • Automotive battery-electric vehicle share: 24% to 26%.

These targets reflect Porsche’s intention to prioritise profitability and financial resilience as it adapts to changing market conditions. While the manufacturer faces declining deliveries and a difficult environment in China, improved cost control and portfolio restructuring have started to support its financial performance.

The expected Automotive net cash flow margin for the full year is also lower than the 11.3% recorded during the first nine months, illustrating the importance of seasonal effects, planned spending and the influence of exceptional transactions on the interim results.

What Porsche’s 2026 Results Mean for Its Future

Porsche’s first-nine-month results reveal a company attempting to balance two priorities: preserving the exclusivity and emotional appeal of its sports cars while restoring sustainable profitability in a demanding global automotive market.

The reduction in deliveries remains a significant challenge, particularly as the company navigates competitive pressure in China, changing demand for electric vehicles and additional costs associated with US tariffs. However, the improvement in operating margins and automotive cash generation indicates that its restructuring measures are beginning to influence the financial results.

The disposal of non-core investments and the planned sale of MHP also demonstrate Porsche’s willingness to reconsider its business portfolio as it concentrates on its core automotive operations.

The next test will be whether the company can maintain its improved profitability without relying on one-off asset disposals and other exceptional financial effects. Delivering attractive new vehicles, controlling costs and sustaining demand across its major markets will be crucial to achieving that goal.

For Porsche, the Sportwagenschmiede ’35 strategy is therefore about more than reducing expenses. It represents a broader effort to build a more focused, agile and financially sustainable business while protecting the brand identity that has made its sports cars distinctive.

With its 2026 forecast unchanged, Porsche is signalling confidence in its restructuring programme. The coming quarters will show whether the improvements recorded so far can translate into lasting financial strength and a more sustainable growth trajectory.

Source: Porsche

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Mercedes-Benz Is Developing More Than 40 New Models by 2027, With F1 Technology Shaping Its Next-Generation Engines

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Mercedes-Benz is preparing one of the most ambitious product expansions in its history, with more than 40 new models scheduled to arrive by the end of 2027. Behind this rapid expansion is a strategy built around powertrain diversity, advanced electrification, next-generation battery technology and software integration, with innovations from Formula 1 playing an increasingly important role in the development of production cars.

Rather than committing to a single propulsion technology, Mercedes-Benz intends to offer customers a broad range of fully electric and hybrid vehicles tailored to different markets, driving habits and expectations. The approach combines more than 140 years of engineering experience with modular vehicle architectures, digital simulations and extensive real-world testing.

At the heart of this strategy is the Mercedes-Benz Operating System (MB.OS), which integrates key vehicle functions into a unified software platform. Designed to work across different powertrains, the system enables Mercedes-Benz to standardise essential technologies while adapting each vehicle to its intended role.

The objective is straightforward: regardless of whether a Mercedes-Benz is powered by electricity, a hybrid system or a combustion engine, it should deliver the same familiar combination of comfort, safety, refinement, sportiness and precision.

Mercedes-Benz Is Expanding Its Powertrain Strategy

Mercedes-Benz believes that the powertrain remains one of the most important factors in determining a vehicle’s character. Engine response, torque delivery, efficiency and refinement all influence how a car feels behind the wheel, making the development process about much more than achieving impressive figures on a specification sheet.

According to Jörg Bartels, Vice President of Powertrain Development at Mercedes-Benz AG, the company is focused on matching technology to real customer needs rather than pursuing a universal solution.

That philosophy influences everything from the calibration of accelerator response to the way a vehicle behaves during motorway acceleration, hill starts, towing or low-speed urban driving.

Development begins with an analysis of real-world driving behaviour. Engineers translate customer usage patterns into technical targets, then use computer simulations to evaluate power outputs, torque characteristics, gear ratios and control strategies. Once a suitable configuration has been identified, it undergoes testing on specialised test benches under different loads and temperatures before moving into vehicle testing.

Suspension, braking and steering systems are developed alongside the powertrain to ensure that every component works as part of a coherent whole. The result is intended to be a consistent Mercedes-Benz driving experience across an increasingly diverse model range.

Modularity is central to making this strategy commercially viable. By sharing components, software foundations and engineering solutions across multiple vehicles, Mercedes-Benz can accelerate development, control costs and introduce new technologies to more market segments.

Modular Hybrid Engines Will Continue to Play a Key Role

Despite its significant investment in electric mobility, Mercedes-Benz is continuing to develop combustion engines and hybrid powertrains.

Its FAME (Family of Modular Engines) programme provides a scalable foundation for petrol and diesel hybrid applications, allowing the company to adapt engine technology to vehicles ranging from the GLA to the flagship S-Class.

These engines incorporate an all-aluminium crankcase featuring NANOSLIDE technology, cylinder heads with partially integrated exhaust manifolds, segmented-turbine turbochargers and compact intercooling systems. Positioning the exhaust system close to the engine also supports efficient thermal management.

The second-generation integrated starter-generator, known as ISG 2.0, contributes to improved fuel efficiency while providing additional electric assistance. Combined with a common software architecture through MB.OS, the modular approach allows Mercedes-Benz to fine-tune hybrid systems for different vehicle sizes and performance requirements.

The strategy reflects the company’s view that electrification will develop at different speeds across global markets. Hybrid technology can offer reduced fuel consumption and improved responsiveness without requiring customers to adapt to fully electric driving and charging.

Mercedes-Benz Is Scaling Its 800-Volt Electric Architecture

On the fully electric side, Mercedes-Benz is extending a modular powertrain architecture derived from the technology developed through its VISION EQXX programme.

The architecture is designed to accommodate a wide range of vehicles, including the CLA, CLA Shooting Brake, GLB and GLA, as well as the GLC and C-Class. Each application can be tailored to its segment, balancing efficiency, everyday usability, long-distance comfort and performance.

The next stage of development will extend the 800-volt electrical architecture to larger vehicle categories, including the E-Class and S-Class.

An 800-volt system can offer substantial charging and efficiency advantages when paired with compatible battery and charging hardware. It allows higher power transfer at a given current, helping engineers manage electrical losses and support rapid charging without relying on excessively high currents.

Mercedes-Benz is approaching the electric powertrain as an integrated system rather than a collection of separate components. The battery, electric drive unit, charging hardware, thermal management and software must work together to minimise energy losses between the battery cells and the wheels.

That integration is particularly important for long-distance driving, where energy efficiency, charging speed and sustained performance all influence the overall ownership experience.

The New Electric Drive Unit Combines an 800-Volt System With Two Gears

One of the key components of the new electric powertrain is the Electric Drive Unit 2.0 (EDU 2.0), which Mercedes-Benz has developed in-house and manufactures within its own powertrain production network.

Designed from the outset around an 800-volt electrical system, the unit applies high-voltage technology throughout the relevant electric drive system, including components such as the air-conditioning compressor. Mercedes-Benz describes this as a first for the entry-level segment.

The inverter uses silicon-carbide technology to improve electrical efficiency, helping reduce energy losses during the conversion of electrical power for the drive motor.

Another important feature is the two-speed transmission with a dog clutch. While many electric cars use a single-speed gearbox, a two-speed arrangement can help reconcile competing demands for strong acceleration, high-speed cruising and efficient energy consumption.

A lower ratio can support acceleration and torque delivery, while a higher ratio can help the motor operate more efficiently at sustained higher speeds. The objective is to achieve a broader range of useful operating conditions without compromising everyday drivability.

The EDU 2.0’s compact construction also helps preserve cabin space, demonstrating how powertrain engineering can influence vehicle packaging as well as performance.

Mercedes-Benz Is Developing New Battery Chemistries to Improve Range and Reduce Costs

Battery technology remains another major strategic priority for Mercedes-Benz. Rather than relying on a single cell chemistry across its entire portfolio, the company intends to tailor battery systems to different vehicle segments and customer requirements.

Some applications prioritise long driving ranges, while others place greater emphasis on charging performance, power delivery, packaging or affordability.

Mercedes-Benz defines the technical requirements, develops battery systems and integrates them into its vehicles. At the same time, it is investigating new cell chemistries designed to improve energy density, shorten charging times and reduce the use of expensive or strategically sensitive raw materials.

One development direction combines lithium manganese oxide (LMO) with nickel manganese cobalt oxide (NMC). Increasing the proportion of manganese while reducing the use of nickel and cobalt could provide an attractive balance between energy density and battery cost.

The company is also advancing lithium nickel manganese oxide (LNMO), a promising chemistry that could eliminate cobalt and significantly reduce nickel requirements compared with conventional NMC cells.

LNMO’s potential high-voltage operation, reaching up to five volts at the cell level, is particularly interesting. Mercedes-Benz identifies the possibility of achieving up to 30 percent greater range than lithium iron phosphate (LFP) batteries at comparable weight and packaging volume.

However, these figures represent potential advantages rather than guaranteed improvements in production vehicles. The ultimate benefits will depend on cell design, durability, thermal management, manufacturing costs and the performance of the complete battery pack.

More compact and lighter battery systems could also give designers greater freedom when developing future electric vehicles. Reducing dependence on critical raw materials would provide additional flexibility as battery supply chains and regulations continue to evolve.

Solid-State Batteries Move Closer to Real-World Testing

Mercedes-Benz is also pursuing solid-state battery technology through partnerships with Factorial Energy and ProLogium.

Solid-state batteries replace the conventional liquid electrolyte used in many lithium-ion cells with a solid electrolyte. Depending on the chemistry and design, this could enable higher energy density, improved packaging and potential safety benefits.

A significant milestone in Mercedes-Benz’s development programme came when a lithium-metal solid-state battery developed with Factorial Energy was tested in an EQS-based development vehicle.

The car covered 1,205 kilometres from Stuttgart to Malmö without recharging, demonstrating the potential of the technology for long-distance electric travel.

The achievement is an important indication of what solid-state batteries could eventually offer, although a development vehicle’s performance does not automatically translate into production-ready technology. Manufacturing scalability, charging behaviour, durability, safety validation and cost remain essential challenges before widespread commercialisation.

Mercedes-Benz is continuing to test next-generation cells, including ProLogium’s Gen4 technology, with a focus on performance, safety and thermal characteristics. The company is also evaluating cells from other partners and working on its own developments.

The programme incorporates expertise from Mercedes-Benz’s motorsport operations in the United Kingdom, underlining how knowledge developed in high-performance engineering can contribute to future road-car technology.

Formula 1 Technology Is Influencing Mercedes-Benz Road Cars

Mercedes-Benz is strengthening its collaboration with Mercedes-AMG High Performance Powertrains (HPP), the company’s Formula 1 powertrain specialist based in Brixworth, England.

HPP develops and manufactures Formula 1 powertrains for the Mercedes-AMG PETRONAS Formula One Team and customer teams. Its contribution to road-car development extends beyond transferring individual components from racing cars into production vehicles.

Instead, the collaboration focuses on sharing engineering knowledge, development techniques and approaches to solving complex technical challenges under demanding time constraints.

The electric exhaust-gas turbocharger introduced in the latest development of Mercedes-Benz’s M 252 petrol engine is a clear example of this relationship.

Formula 1 programmes place enormous emphasis on energy management, thermal efficiency, rapid response and extracting maximum performance from compact powertrain systems. Those same principles can be valuable when engineers seek to make production engines more responsive and economical.

For Mercedes-Benz, the aim is to translate specialist motorsport expertise into improvements that drivers can experience in everyday conditions.

The M 252 LS Is Mercedes-Benz’s Most Powerful Four-Cylinder Compact-Class Engine

One of the most notable developments is the new M 252 LS petrol engine, an evolution of the 1.5-litre M 252 introduced previously.

Mercedes-Benz quotes a combined output of 170 kW from the combustion engine plus an additional 23 kW from the electrified system. This makes it the most powerful four-cylinder engine in the brand’s compact class, according to the company.

The engine also introduces an electrically assisted exhaust-gas turbocharger rated at 5 kW, powered by the vehicle’s 48-volt electrical system.

Unlike a conventional turbocharger that relies primarily on exhaust-gas energy to accelerate its turbine, an electrically assisted system can use an electric motor to help the turbocharger build boost more quickly. This can reduce turbo lag and improve throttle response, particularly when engine speed and exhaust flow are relatively low.

The result should be more immediate acceleration across a wider portion of the rev range, alongside the potential for improved efficiency.

The technology builds on concepts developed and used by the Mercedes-AMG PETRONAS Formula One Team over many years, although the production engine has been engineered for the different demands of road use.

Mercedes-Benz also claims measurable benefits in the new GLB 250. Compared with the previous-generation GLB 250 equipped with the M 260 engine, the M 252 LS-powered model accelerates approximately 0.1 seconds faster while producing around 17 percent fewer CO2 emissions.

An additional 2 kW electric turbocharger function can recover energy from the exhaust system and convert it into electrical energy. Two newly added Lanchester balance shafts further reduce engine vibrations, helping deliver the smooth running expected from a Mercedes-Benz.

Together, these changes illustrate how relatively small combustion engines can continue to evolve through electrification and more sophisticated engineering rather than relying exclusively on increased displacement.

MB.OS Will Connect Different Powertrains Through One Software Platform

As Mercedes-Benz expands its portfolio, software is becoming an increasingly important part of its engineering strategy.

The Mercedes-Benz Operating System is designed to integrate major vehicle functions into a common, adaptable architecture. By providing a shared software foundation across different powertrains, MB.OS can help simplify development while allowing individual models to retain their distinct characteristics.

This is particularly important as combustion engines, hybrids and electric vehicles increasingly share vehicle platforms, electronic systems and digital features.

A common architecture can make it easier to coordinate energy management, powertrain controls and other vehicle functions, while supporting software updates and future technical improvements.

The broader ambition is to ensure that technological complexity does not compromise the driving experience. Drivers should benefit from more sophisticated systems without needing to understand the engineering behind them.

For Mercedes-Benz, digital integration is therefore not simply about adding more connected features. It is also about making the vehicle’s fundamental systems work together more intelligently.

Mercedes-Benz Is Betting on Technological Diversity

Mercedes-Benz’s product strategy for the period leading up to the end of 2027 reflects a major shift in how the company approaches vehicle development.

Rather than choosing between combustion engines and electric propulsion, it is investing in modular hybrid systems, dedicated electric drive units, 800-volt architectures, next-generation batteries and software that can support different technologies across the portfolio.

The strategy also demonstrates the growing importance of collaboration between traditional automotive engineering, battery research and motorsport development.

Solid-state batteries still require further development before their full commercial potential can be realised, while new battery chemistries must overcome practical manufacturing and durability challenges. Meanwhile, hybrid engines and electrically assisted turbochargers offer a way to improve efficiency and responsiveness in vehicles that continue to use combustion power.

With more than 40 new models planned by the end of 2027, Mercedes-Benz is attempting to combine these technologies into a broader and more flexible product range.

The central challenge will be delivering meaningful benefits to customers while keeping development costs, complexity and production requirements under control. If the strategy succeeds, future Mercedes-Benz models could offer a wider choice of propulsion technologies without sacrificing the comfort, refinement and driving character that define the brand.

For buyers, the most important developments may not be the headline numbers alone. Faster charging, improved efficiency, more responsive engines and longer electric driving ranges could ultimately make the biggest difference in everyday use.

Source: Mercedes-Benz

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