RBC cuts Mercedes, raises Volkswagen ratings on trade risk exposure

Porsche Automobil Holding SE

23/09/2025 09:17

** RBC Capital Markets cuts rating of Mercedes-Benz MBGn.DE, but upgrades Volkswagen VOWG.DE on differences in exposure to trade risks, regional performance

** VOWG now "outperform" from "sector perform", MBGn "sector perform" from "outperform"

** Says VW's Mexico-heavy production base, potential USMCA carve-outs could significantly reduce tariff exposure vs Mercedes' EU-based manufacturing that faces 15% tariff and limited ability to shift production

** RBC cites VW's stabilising China ops, strong core brand margins, expected gains from Everllence, local equity income

** Notes recent conservative Porsche-tied impairments, share price pullback have de-risked VW's downside

** Mercedes faces persistent China weakness, soft luxury demand, new import taxes, intensifying competition from domestic EV maker - RBC

** VOWG rises 1.9%, MBGn up 0.77%

 (Reporting by Emanuele Berro)

 ((emanuele.berro@thomsonreuters.com))