On Thursday (February 22), the auto giant became the latest carmaker to warn of a lower than expected appetite for battery-powered cars.

The company now expects sales of EVs to make up around half of its total by 2030.

Thursday's announcement was a major step back from its previous ambition to prepare for all-electric sales by that year.

Mercedes-Benz further said it would update its combustion engine lineup well into the next decade.

Company CEO Ola Kaellenius.

"A systemic shift the size of this, I mean, changing the whole, let's say, energy infrastructure behind mobility is a very, very big task. So we have to realize that there can be peaks and troughs in this transition."

Multiple studies have shown customers holding back from EVs for a range of reasons.

Those included a lack of charging infrastructure and appealing electric models.

Mercedes-Benz reported group earnings fell to $21.3 billion - down from a year before, despite a 2% rise in revenue.

Despite that, shares were up for the luxury carmaker 6% following the update.

The rise was supported by a $3.3 billion share buyback program unveiled late on Wednesday (February 21).