You’ll Never Guess Which Vehicle Is Saving Mercedes-Benz. Okay, I’ll Tell You: It’s Vans

If there’s one thing I’ve come to appreciate about The Autopian audience is that y’all either have a van or greatly appreciate the vans other people have. If 2024 was “brat summer” then 2026 is “van summer.” You know else is having van summer? Well, if you read the headline and don’t have the answer to this question go grab another cup of coffee.

It’s Mercedes! The automaker has done the German thing of having over-invested in EVs and underestimated the downturn in Chinese demand. Thankfully, Mercedes does one thing consistently well: Vans. It also has a great looking EV van coming out. Vans!

What Mercedes doesn’t sell here (yet) is a small car. The President was in Michigan trying to build excitement ahead of the midterm elections and a random part of his pitch was tiny cars again. Tiny cars! This isn’t a terrible plan, as tiny cars are how BYD is hoping to break into the Chinese market. On the topic of Japan, our thoughts are with the people there facing another devastating earthquake which, again, is potentially going to disrupt the car market.

Mercedes Slumps After Weakness In China, Vans Come To The Rescue

Things have not been gut in Stuttgart, with historic automaker Mercedes-Benz taking it in die shorts due to various geopolitical issues, EV investments not yet panning out, and the weakness in the Chinese market.

As Bloomberg reports, this has meant a weak Q2 and a write-down due to the business in China not working out:

For the second quarter, adjusted operating earnings from carmaking slumped 26% from a year earlier to €909 million ($1 billion). The average selling price fell by 4.4% to €64,700 from a year earlier, underscoring the pressure from weaker pricing and product mix.

The worsening outlook in China also prompted Mercedes to take a €704 million write-down on investments in businesses there.

That’s not great. As Bloomberg points out, there is one part of the business that’s making up for some of the weakness in automotive and it starts with V and it rhymes with P and that stands for, uh, vans. I guess.

Vans! As Mercedes-Benz pointed out in its Q2 financial release:

With an adjusted RoS of 10.2%, Mercedes-Benz Vans once again achieved double-digit results in the second quarter of 2026. Adjusted EBIT increased by 3% to €454 million compared with the second quarter of 2025, driven by higher sales outside of China, positive contributions from aftersales and the leasing portfolio. At the same time, the results reflect net pricing pressure and product mix effects as well as the ramp-up efforts for the new Van Architecture. Mercedes-Benz Vans is currently executing its largest product investment programme in its history.

Mercedes-Benz Vans recorded second-quarter sales of 94,075 units, reflecting stable overall global demand with a strong performance in North America (+23%) and Europe (+5%) along with significant sales growth for eVans (+46%) compared to the second quarter of 2025.

I do love a Mercedes van. In fact, the eSprinter is maybe my favorite electric vehicle. The company knows how to make a van, and the new VLE looks kind of incredible. Mercedes has apparently improved its game when it comes to its latest generation of EVs, and if I ever get to drive one again I’ll let you know how that goes.

It’s a great time for vans, and Millennials (like myself) are apparently making vans cool again. Or at least trying according to CNN. What’s wild is that,  per a report in Manager Magazin, CEO Ola Källenius almost stopped the development of gas and diesel vans entirely:

Källenius staked almost everything on one card. AMG, the company’s in-house supercar division from Affalterbach, was to focus exclusively on building electric vehicles. The then-head of the van division, Mathias Geisen (48), developed the VAN.EA platform for all battery-powered vans, while existing gasoline and diesel variants like the Sprinter were to be extended. Mercedes simply refused to develop a new platform for combustion engines. This plan is likely to prove one of Källenius’s biggest failures. While the company had long made enormous profits from vans, the new platform unfortunately had to be converted to accommodate combustion engines at great expense. This billion-dollar debacle is likely to soon be reflected in the company’s financial results.

Vans!

I Don’t Really Know What President Trump Means Here

Like many of us, President Trump seems obsessed with kei cars, and talks about approving the production of them all the time. What does that mean? I have no idea, but President Trump spoke in Michigan at a rally at a GM’s Milford Proving Grounds, and there was a lot of political talk and then… an appreciation of small European cars.

“And today I’m giving all American car companies the right to build what are called tiny, little, tiny cars. Because I go to Europe and I see these little cars all over the place. I say ‘Why aren’t we making some?” Trump explained. “Sean Duffy, the Secretary of Transportation, has just cleared it. I was with him in the plane and I said ‘Sean, did you clear that?’ and he said ‘No sir, not yet,’ and I said ‘I want it done now’ [and he said] ‘Oh, it’s done sir.”

He then said Sec. Duffy was “very smart” while laughing for some reason. Addressing GM CEO Mary Barra, he said:

“It’s a tiny little beautiful little car. I’m not sure I want to get hit by one of your Silverados or one of your Cadillacs, but you’ll make them as safe as possible, right? You put a cocoon, you put a little cocoon around them.”

I have reached out to the Department of Transportation on clarification of what this all means, because I haven’t seen anything in the Federal Register today that explains what any of this means. President Trump did talk about affordability, and this seems to stem from an understanding that vehicles are expensive, and an unwillingness to connect that reality to tariffs.

BYD Is Going After Japanese Small Cars

BYD needs exports, so why not try to crack into Japan’s notoriously walled off market? The Chinese automaker’s first big attempt is an electric kei car called the Racoo, which is the Japanese word for sea otter. It costs about $13-15k and returns almost 200 miles of range (on their test), which is more than any other Japanese mini EV.

It’s also the first car developed by a Chinese automaker solely for a single export market, as Nikkei Asia reports:

“When I visited regional parts of Japan, I often heard people say that kei cars are an integral part of daily life and ask whether BYD could introduce one as well,” Liu Xueliang, president of BYD Japan, said at a launch event. “Contributing to the growth of local communities is at the very root of BYD,” he said, explaining its decision to develop a kei EV from the ground up.

It marks the first time the Chinese automaker has developed a passenger vehicle specifically for a single country. “No overseas brand had ever taken on the challenge before, but BYD decided to do so … we are fully committed to Japan,” added Liu, who is also vice president of BYD.

I’m looking forward to seeing one in action in Godzilla Plus One.

Japanese Earthquake Could Impact Production

The large earthquake that hit the Kumamoto region of the island of Kyushu this afternoon in Tokyo could impact an area that has a large amount of car production as Automotive News reports:

Toyota Motor Corp. and Nissan Motor Co. have automaking hubs in the northern part of Kyushu, about 150 kilometers (93 miles) from the quake’s epicenter.

Toyota suspended second-shift operations at its Lexus assembly plant, its Kanda engine plant and its Kokura hybrid powertrain plant in the region.

“Due to the impact of the earthquake, considering safety, logistics, and supplier status, we have suspended operations for the 2nd shift,” a spokesman said.

Toyota aims to resume work from the first shift on July 29, pending evaluation of the supply and quake aftermath, the spokesman said.

Japanese automakers are experienced with these kinds of disruptions and the plans are to resume production tomorrow.

What I’m Listening To While Writing TMD

The Kacey Musgraves video for “Mexico Honey” is out and it’s very literal, with a bit of a karaoke theme. And parrots!

The Big Question

What’s your favorite van?

Top photo: TMD