Mercedes-Benz Stock Mounts Comeback as Labor Dispute Escalates Over Soured Bonus Payments

The Stuttgart automaker finds itself caught between a nascent share-price recovery and a rapidly escalating confrontation with its workforce. While the stock clawed back 4.91% last week to close at €45.40, tens of thousands of employees are walking off the job after management scrapped a scheduled bonus and demanded longer shifts without extra pay.

Around 90,000 of Mercedes-Benz’s roughly 108,000 German staff will miss out on the “transformation component” — a special tariff payment originally due in July, now pushed to next year. The company blames shrinking profits and a weak economy for the decision. On top of that, the board is pressing for extended working hours with no wage compensation, a move the works council chief Ergun Lümali described as shifting management’s own failures onto the workforce. IG Metall chairwoman Christiane Benner echoed that criticism, warning that the leadership is creating pressure instead of offering a perspective.

Technical Rebound From the Abyss

The stock’s bounce came after hitting a fresh 2024 low of €42.64 in late June. Analysts view the rally as a textbook oversold reaction. The Relative Strength Index, which had flashed extreme oversold readings, has recovered to a neutral 43.8, removing immediate technical headwinds. Historical patterns suggest such impulses can sustain a multi-week recovery, and market observers now see room to test the €50 psychological barrier.

Yet the long-term chart tells a darker tale. The shares have plunged 26.37% since the start of the year and continue to trade well below the 50-day moving average, currently at €48.44. A clean break above that line would open the path toward €50, but if the price slips back under the recent trough, the bullish signal evaporates.

Should investors sell immediately? Or is it worth buying Mercedes-Benz?

Bargain Hunters Eye Deep Value

Alongside the technical setup, fundamental metrics are drawing attention. Mercedes-Benz trades at a historically cheap valuation, with a 2026 estimated price-to-earnings ratio of just 7.7 and a 2027 multiple of 6.1 — both far below the long-term average. Long-term investors are also lured by a prospective dividend yield of 7.4%, though collecting that payout requires patience until next year. The stock’s current volatility of 29.4% will test the nerve of anyone holding on.

A Hot Summer on the Shop Floor

The labor calm is unlikely to return soon. The union is gearing up for a prolonged battle, warning of a “hot summer” that could cause costly production halts if management stays on its cost-cutting course. The next escalation is already scheduled: a large car convoy through Stuttgart on July 9, orchestrated by worker representatives.

For now, the share price is enjoying a technical reprieve, but the underlying pressure from the factory floor and the persistent downtrend leave the outlook highly uncertain. Ratchets like the 50-day average will determine whether this recovery has legs — or is just a pause before another leg lower.