Mercedes-Benz Stops US Production of EQ Lineup Electric SUVs and Sedans
Mercedes-Benz has announced a halt in the production and new orders of its EQ electric lineup for U.S. dealerships, citing low demand, a glut of unsold vehicles, and the upcoming expiration of the federal EV tax credit as the main reasons [1][2][3].
The production pause will start on September 1, 2025, with no announced restart date [1][3]. The company's Alabama plant will continue production but will focus on global markets rather than the U.S. [2][3].
Criticism of the EQ design language, particularly the "egg-shaped" EQS, and relatively modest driving range have affected consumer interest [1][2]. Additionally, the disappearance of the federal tax credit will dry up a bidding engine that has buoyed U.S. EV sales for years [2][3].
The production halt affects every variant in the EQE and EQS line, including sedans and SUVs. However, Mercedes is pivoting to MMA-based vehicles, hinting at a return to familiar forms like sedans and SUVs [4].
The Tuscaloosa, Alabama plant will continue building EQ SUVs for export, while German factories at Sindelfingen and Bremen will produce the EQS and EQE sedans. The EQE and EQS share architecture with high-performance plug-in hybrid AMG models [5].
The electric version of the CLA sedan and an electric GLC are expected to launch later in 2025 and September's Munich IAA auto show, respectively [5]. Mercedes views this intervention as tactical, managing supply rather than pulling back from electrification [2][3][4].
However, a more cautious recovery may precede the resumption of production, according to a TruthAboutCars analysis [6]. The intervening months may define whether Mercedes's strategy for its next-stage electric models is bold but blurry or decisive and visionary.
Meanwhile, Mercedes dealers face uncertainty as they head into fall with service capacity but evaporating inventory. The fuzzy middle ground of luxury EVs at six-figure price tags without subsidy has proven difficult terrain for Mercedes. Customers weighing a high-end EV purchase may accelerate decisions or wait for the federal credits to return under a new administration. Fleet incentives often drive last-minute sales, suggesting a potential recovery after the production halt.
[1] https://www.autonews.com/electric-vehicles/mercedes-benz-halts-us-eq-model-production-amid-low-demand [2] https://www.motortrend.com/news/mercedes-benz-pauses-eq-production-for-us-dealers-due-to-low-demand/ [3] https://www.cnbc.com/2025/08/18/mercedes-benz-pauses-production-of-electric-vehicles-in-us-amid-low-demand.html [4] https://www.truthaboutcars.com/2025/08/mercedes-stops-us-eq-production-and-orders-but-not-for-long/ [5] https://www.autoblog.com/2025/08/18/mercedes-benz-pauses-us-eq-production-and-orders/ [6] https://www.truthaboutcars.com/2025/08/mercedes-stops-us-eq-production-and-orders-but-not-for-long/
- The production halt of Mercedes-Benz's EQ electric lineup in the United States has been attributed to low demand, an abundance of unsold vehicles, and the upcoming expiration of the federal EV tax credit.
- Mercedes is pivoting to MMA-based vehicles, indicating a return to familiar forms like sedans and SUVs, despite the pause in the production of the EQE and EQS line.
- The Tuscaloosa, Alabama plant will continue building EQ SUVs for export, while German factories will produce the EQS and EQE sedans, with the electric version of the CLA sedan and an electric GLC expected to launch later in 2025.
- Dealers face uncertainty as they head into fall with service capacity but evaporating inventory, and the fuzzy middle ground of luxury EVs at six-figure price tags without subsidy has proven difficult terrain for Mercedes, as customers weigh decisions or wait for the federal credits to return under a new administration.
