Mercedes-Benz takes action to pursue premium rivals in China

Article by Christian A., on January 7, 2015

Mercedes-Benz is currently behind rivals BMW and Audi in terms of sales both in China and around the world. Knowing this fact, Mercedes is taking definitive action to narrow the gap established by its two German rivals in China – making its local r&d operations much stronger than before and the possibility of launching products first in the country.

The carmaker’s lag can attributed to the fact that it had two competing sales organizations, has fewer dealers, and a seemingly lack of locally built compact crossovers. Mercedes development chief Thomas Weber told Automotive News Europe that in the past, the carmaker was behind competing manufacturers since China wasn't part of the first rollout phase for new vehicles.

"Why not be first at some point?” He noted that introducing a vehicle first in China would entail a massive investment in r&d, which is what Mercedes is intending to do. In the past few years, Mercedes parent Daimler has named a new board-level executive who would be responsible for China, has unified its local sales and distribution and added 179 dealerships.

Daimler also built a car engine site in China and acquired a 12-percent stake in joint venture partner BAIC Motor for almost EUR630 million ($769.2 million).

Mercedes will commence output of the GLA compact crossover early this year in China, adding to the production of its midsize GLK crossover and long-wheelbase versions of the E- and C-class sedans.

The carmaker is also bound to build compact cars at its joint venture plant in Beijing following a $1.2-billion investment by Daimler and BAIC.

For this year, Mercedes is targeting to sell over 300,000 cars in China, two-thirds of which would be built locally. However, building such large number of vehicles in China would mean higher level of local content, a larger pool of qualified suppliers and more testing operations as well as large investment.

Topics: mercedes-benz, china

If you liked the article, share on:

Comments

Recommended

We recently heard that Italian automakers, Ferrari and Lamborghini, are not so keen on building an all-electric sports car just yet. On the contrary, Bentley has just confirmed that there...
by - September 17, 2017
Back in 2013, Nissan introduced the IDx Concept at the Tokyo Motor Show. When the audience first saw this, a lot of people got excited to see a lightweight sports...
by - September 17, 2017
Does the RS Edition and its LSD feature deserve all the media attention? The short answer to that is yes. Let us explain why. Ford today has revealed its new...
by - September 16, 2017
While the FJ Cruiser was no longer sold in the US since 2014 with the Trails Teams Edition being its final model, Toyota has now decided to terminate its production...
by - September 16, 2017
That there’s bad blood between Mercedes-Benz and BMW doesn’t surprise anyone. The fierce competition between the two brands may have stemmed from the fact that they both have German roots,...
by - September 15, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries