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Mercedes Cedes Luxury Sales Lead to BMW

German maker sees victory in defeat.

by on Dec.14, 2012

Mercedes-Bez US CEO Steve Cannon.

With barely two weeks left in the year, Mercedes-Benz is ceding victory to rival BMW in the luxury car sales sweepstakes.

But there’s victory in that loss, contends Mercedes’ top American executive as he notes the maker still had its best year ever in the U.S. market and is looking to do even better when an assortment of critical new products reach showrooms in 2013.

The Last Word!

“I don’t think we’ll win the race this year,” said Steve Cannon, CEO of Mercedes-Benz U.S., adding that he felt “no pressure” from his bosses in Stuttgart to engage in the sort of last-minute deal-making that has marked the race for luxury sales supremacy in recent years.

One reason may be that despite falling short of BMW’s tally, Mercedes has set records for eight of the first 11 months of this year and will still set an all-time record in the U.S. once the books are closed on 2012.

Sales should come in “north of 270,000,” said Cannon, during a luncheon meeting with Detroit’s automotive media.  That will not only be a significant jump from 2011 but also beat the maker’s previous record of 253,000 set in 2007.

That’s clearly good news for a company facing problems in a number of other major markets. Like virtually everyone operating in Europe, Mercedes has suffered a significant decline as the Continental car market continues to decline along with the rest of the economy there.

But things have also proved unexpectedly challenging in China, the world’s largest automotive market. Overall sales have slipped sharply in 2012 and the luxury market, in particular, has been particularly problematic, Mercedes having to boost incentives and slash prices. It has nonetheless fallen behind key rivals BMW and Audi in the Chinese market.

(As TheDetroitBureau.com reports today, the maker’s parent, Daimler AG, has shuffled Chinese management hoping to revive its position in the market. Click Here for that story.)

There had been some concerns that 2012 would be a tough year in the U.S., as well. Cannon was elevated to the CEO spot following the 2011 ouster of Ernst Lieb who had been accused of misusing corporate funds to furnish his home.

“We made it through a transition in a very healthy state,” said Cannon.

The coming year could prove an even bigger test of his leadership skills, however, as 2012 sees the launch of three “watershed” new products:

  • The all-new CLA, a coupe-like sedan that is based on the latest-generation Mercedes-Benz A-Class, the first time the maker has offered a product of that diminutive size in the U.S.;
  • An all-new version of the E-class sedan, a model Cannon describes as the “bread-and-butter” for Mercedes’ U.S. subsidiary; and
  • A complete remake of the flagship S-Class, the car that ultimately defines the Mercedes brand.

(For more on the new E-Class, Click Here.)

With those three models on the docket the sales race for 2013 could have very different results – or so Mercedes officials are hoping.

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