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Mercedes Hits the Brakes on EVs: Profit Woes Lead to Focus on Gas-Powered Cars

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StartupStories - Mercedes

Luxury carmaker Mercedes-Benz is experiencing a shift in gears, prioritizing gasoline-powered vehicles over its previously ambitious electric vehicle (EV) strategy. This comes after disappointing sales figures and shrinking profit margins for their electric offerings.

The Dream Runs out of Charge:

Mercedes, a leader in the luxury car market, had set a goal to be fully electric by 2030. However, sluggish sales of their electric vehicles, particularly the high-end EQS and EQE sedans, have forced a recalibration of their plans. The company’s profit margin dipped to a concerning 9% in the first quarter of 2024, falling below their long-term target range.

Why the Slow Charge?

Several factors are contributing to the lackluster performance of Mercedes’ EVs:

  •  Price Point Pinch: The high price tag of Mercedes’ electric cars, ranging from $70,000 to $120,000, limits their appeal compared to more affordable electric options. 
  •  Competition Heats Up: Other luxury carmakers like Tesla and BMW are offering strong competition, with some even surpassing Mercedes in EV sales growth. 
  •  Infrastructure Concerns: Gaps in charging infrastructure and anxieties about range remain significant deterrents for potential EV buyers.

Back to the Drawing Board:

In response to these challenges, Mercedes CEO Ola Källenius announced a revised strategy. The company will:

  •  Extend Focus on Combustion Engines:  Production of gasoline-powered and hybrid vehicles will continue well into the 2030s, catering to customer demand.
  •  Rethink EV Strategy: Mercedes will analyze consumer preferences and market trends to refine their electric car offerings. This may involve focusing on more affordable models or improving features to enhance range and charging efficiency.

The Road Ahead

The shift by Mercedes highlights the complexities of the automotive industry’s transition to electric vehicles. It underscores the need for car manufacturers to balance ambitious environmental goals with the realities of consumer behavior and market competition.

Is this a Permanent Pause?

While Mercedes is putting the brakes on its all-electric vision, it doesn’t necessarily signal a complete retreat from EVs. The company may leverage this time to strengthen its electric offerings and ensure they are competitive in the rapidly evolving market. Only time will tell if Mercedes can reclaim its position as a leader in the electric vehicle race.

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OpenAI’s Trusted Contact Feature Signals a New Direction in AI Safety

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Open AI

OpenAI’s introduction of trusted contact safeguards for potential self-harm cases reflects a major evolution in AI responsibility.

Beyond Moderation

AI safety is shifting from simply blocking harmful content to actively supporting user wellbeing through:

  • early risk detection
  • human-centered intervention
  • stronger emotional safety frameworks

This positions AI as more than an information tool—it becomes part of broader digital support systems.

Key Industry Impact

Trusted contact models could influence future safety standards across:

  • AI assistants
  • mental health platforms
  • social media
  • digital health services

The Bigger Challenge

While promising, success depends on balancing:

  • privacy
  • consent
  • ethical intervention
  • user trust

Final Take

This move signals that the future of AI safety may rely not just on preventing harmful responses, but on building more responsible, human-connected support systems.

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₹290 Crore Boost: Rozana’s Series B Funding Scales Rural Retail Network Nationwide

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rozana

Rozana, India’s leading rural retail platform, has secured ₹290 crore ($35 million) in a Series B funding round led by Bertelsmann India Investments (BII), with participation from Omidyar Network India, Vivid Capital, and Tana Investment Holding. This Rozana funding brings its total capital to over ₹500 crore, fueling hyperlocal expansion in underserved rural markets. Founded in 2021 by brothers Prashant and Prateek Chauhan, the startup’s phygital model blends micro-stores, app-based ordering, and last-mile delivery to connect 5 million+ users in 12 states with brands like ITC and HUL.

The ₹290 crore investment will supercharge Rozana’s rural omnichannel retail strategy, targeting 5x growth in 18 months. Plans include adding 5,000 micro-stores in Uttar Pradesh, Bihar, and Rajasthan; AI-powered inventory tech; and new categories like groceries and electronics. By empowering 20,000+ rural micro-entrepreneurs, Rozana taps into India’s $700 billion rural retail boom, where smartphone penetration and UPI drive 12% annual growth.

This Rozana Series B milestone positions it as a frontrunner against rivals like Ninjacart, eyeing unicorn status by 2028 amid ONDC tailwinds. CEO Prashant Chauhan emphasized, “We’re building rural prosperity through accessible premium brands.” For more on Rozana funding news and rural retail trends, stay updated on India’s startup ecosystem.

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Peak XV New Funds: $1.3B Commitment for India Startup Surge 2026

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Peak XV Partners has launched three new funds totaling $1.3 billion, targeting India’s booming startup ecosystem. The lineup features the $600M Surge fund (8th edition) for early-stage ventures, a $300M Growth Fund for Series B+ scaling, and a $400M Acceleration Fund for rapid portfolio expansion. This commitment arrives as India’s VC inflows rebound, with AI and fintech leading 2026 trends.

These funds build on Peak XV’s legacy of backing unicorns like Zomato and Pine Labs, offering founders capital plus strategic guidance amid post-winter recovery. Early-stage deals surged 20% last year per Tracxn, positioning Peak XV to fuel the next wave of innovation in SaaS, climate tech, and consumer plays.

For startups eyeing Peak XV new funds or Surge fund 2026 applications, this signals prime opportunities. Investors and marketers should watch for deployment updates India remains a global VC hotspot.

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