Mercedes-Benz has increased its operating profit forecast for the year, with the automaker expecting its earnings before interest and taxes (EBIT) in 2023 to match that of the previous year, reaching an impressive €20.5 billion.

The decision to raise the operating profit forecast comes in the wake of a robust second-quarter performance, where Mercedes-Benz surpassed market expectations. The EBIT profit for the second quarter of 2023 reached a remarkable €5 billion, exceeding the anticipated €4.7 billion.

One of the primary drivers behind these positive results has been the exceptional performance of the company’s Vans division. This division’s increased earnings have significantly contributed to the company’s strong financial showing.

In addition to the Vans division, the Cars division has also performed remarkably well, boasting a 13.5% adjusted return on sales. Furthermore, Mercedes-Benz has raised the anticipated return on sales for the Vans division in 2023 from 11% to an impressive 13% to 15%, reflecting the division’s upward trajectory.

The remarkable financial results are partly attributed to a notable 6% increase in vehicle sales during the second quarter. This surge in demand has been primarily driven by a growing interest in electric and luxury vehicles, aligning with the automotive industry’s broader shift towards sustainable and high-end products.

Despite the positive performance, the announcement of the increased operating profit forecast has had a mild impact on Mercedes-Benz shares. Following the disclosure, the company’s shares experienced a slight dip, trading 0.4% lower on the Frankfurt Stock Exchange. This reaction may be attributed to the market’s sensitivity and expectations concerning the auto industry’s future growth and potential challenges.

Overall, Mercedes-Benz’s strong second-quarter performance and its decision to raise the operating profit forecast underscore the company’s resilience in the face of economic uncertainties. The automotive giant’s continued focus on innovation, sustainable products, and meeting customer demand for luxury and electric vehicles appears to be driving its success in the highly competitive global automotive market.