Audi, BMW, Mercedes-Benz challenge US rivals with cheaper models

Article by Anita Panait, on January 14, 2014

German luxury carmakers Audi, Mercedes-Benz and BMW are introducing cheaper models in the United States to attract customers and take the away from volume rivals like Ford. Audi will sell the A3 sedan for $29,900 when it becomes available in the spring. This would be almost the same price as the Mercedes-Benz CLA sedan that has been on sale since September 2013. 

German luxury carmakers are trying to capture customers who are willing to pay for such models like the $26,780 Ford Taurus and $30,545 Chrysler 300. They are targeting to ensnare a wider base of customers and keep them loyal. Mercedes’ CLA drive has helped it to capture the crown as the best-selling luxury carmaker in the US, dethroning BMW.

BMW is planning to roll out the $33,025 2-Series Coupe in the first quarter of 2014 as it vies anew to capture new customers.

“Luxury has always been aspirational and once you’re part of that, you tend to want to maintain that,” said Jeff Schuster, an analyst with LMC Automotive. “There tends to be more loyalty with premium than non-premium brands. Take the case of Steve Berger of Massachusetts.

He told Bloomberg he never owned a Mercedes and considering Chevrolet and Lincoln models until he saw a black CLA with a tan interior. “It hit me right away like ‘Bang!’,” Berger said, paying about $37,000 for his CLA after getting captured by its styling and handling. The move to shift down-market follows a similar move by Mercedes, Audi and BMW in Germany.

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