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Mercedes-Benz (MBGAF) Starts Producing 2023 EQ Range in the US

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Mercedes-Benz Group AG (MBGAF - Free Report) recently announced that it has started production of its first battery-electric SUV for the U.S market. The EQS SUV production began at the Alabama plant the previous week and will be followed by the manufacture of the EQE SUV later this year.

The auto magnate has announced a range of EQ lineup of electric vehicles for the U.S. market. Two versions of the EQS sedan have already reached the U.S. market and will soon be followed by two versions of a smaller EQE. In a statement, it shared details of the new versions of EQS and EQE for 2023.

The new addition will cover an EQS 450 4MATIC, which will join the current 450+ and 580 4MATIC, as well as a 350 4MATIC version of the EQE, which will join the previously announced 350+ and 500 4MATIC models.

Moreover, Mercedes has announced that the 2023 model year will include an AMG version of the EQE sedan, in line with the previously announced AMG EQS. The AMG EQE Sedan has impressive driving dynamics and a powerful high-performance drive battery that uses the latest lithium-ion technology.

The entire range of 2023 EQ vehicles will arrive by late 2022. No information on pricing has been released yet, though the SUV is expected to cost more than the EQS 450, priced at $103,360 or the EQS 580, priced at $126,950. Sales are expected to first begin in the United States later this summer.

The country has recently seen a surge in EV production by various renowned automakers. This is because, besides inflation, geopolitical conflict and volatile supply for materials, the Inflation Reduction Act has spurred automakers worldwide to move operations to the United States.

The act, which was recently signed into law, intends to enhance EV capabilities by providing manufacturers with $40 billion in tax credits and stating that EVs eligible for such credits should be made with more American-made parts. Undoubtedly, this law has led automakers to scramble for U.S. production of electric vehicles and batteries to qualify for the incentives.

The 2023 EQS SUV was unveiled in April this year and has pumped up people’s expectations. For quite some time, Mercedes has been taking off the wraps from its EQ lineup of EVs and 2023 may prove to be the year of the EQ as the Germany-based luxury automaker intensively grows its EQ range to aim for zero-combustion as the end goal.

Shares of Mercedes-Benz have lost 35.6% over the past year compared to its industry’s 29.3% decline.

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Zacks Rank & Other Key Picks

MBGAF carries a Zacks Rank #2 (Buy), currently.

Other top-ranked players in the auto space include Harley-Davidson (HOG - Free Report) and LCI Industries (LCII - Free Report) , BorgWarner (BWA - Free Report) , each carrying a Zacks Rank #2, currently. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Harley-Davidson has an expected earnings growth rate of 6.9% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised 8.5% upward in the past 30 days.

Harley-Davidson’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed in one. HOG pulled off a trailing four-quarter earnings surprise of 49.52%, on average. The stock has risen 4.3% in the past year.

LCI Industries has an expected earnings growth rate of 68.1% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised 1.3% upward in the past 30 days.

LCI Industries’ earnings beat the Zacks Consensus Estimate in all of the trailing four quarters. LCII pulled off a trailing four-quarter earnings surprise of 26.48%, on average. The stock has declined 12.7% over the past year.

BorgWarner has an expected earnings growth rate of 2.9% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised 5.2% upward in the past 30 days.

BorgWarner’s earnings beat the Zacks Consensus Estimate in all of the trailing four quarters. BWA pulled off a trailing four-quarter earnings surprise of 29.45%, on average. The stock has declined 11.6% over the past year.

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