Daimler CEO Ola Kallenius stated the success of the newest Denza crossover will decide the long run prospects of the Chinese language electric-car model with accomplice BYD, following years of lackluster gross sales.

“The money funding is behind us” for the mannequin, Kallenius informed reporters on Thursday. “Now we glance how Denza develops after which we are going to make choices.”

Tepid demand for Denza’s EVs has raised issues because the maker of Mercedes-Benz vehicles works to elevate returns. BYD declined to remark.

Daimler and BYD established the model a decade in the past to faucet development within the Chinese language new-energy automobile market. Whereas gross sales have taken off, fierce competitors in price-sensitive quantity segments is posing a problem with regard to profitability.

“We maintain the view that solely EVs geared towards the upper finish of the market makes financial sense,” Sanford C. Bernstein analyst Arndt Ellinghorst stated in a notice.

Kallenius has taken various steps to overtake the world’s largest maker of luxurious vehicles and business automobiles since turning into CEO in 2019. Daimler this month stated it can spin off its sprawling vans division to make each firms extra nimble.

Earlier, the corporate folded the Sensible minicar model right into a joint venture in China and offered the unit’s French manufacturing unit to Ineos Group. Ineos will use Sensible’s Hambach plant to build the Grenadier, a Land Rover Defender rival.

Daimler’s strikes are a part of a plan to deal with luxurious vehicles filled with refined digital gadgetry.