It’s a close race, one that likely won’t result in deep price cutting to move models, but is certain nevertheless to be on the minds of operatives employed by two automakers until the clock strikes midnight for the final time this year. What the race is all about is this : the perennial sales battle between two German automakers, BMW and Mercedes, with BMW expected to pass Mercedes in world sales totals for 2005. The implications are robust for each automaker and will set the tone for the way each company produces and markets vehicles from 2006 forward.
Mercedes finishing second to BMW isn’t a comfortable taste for DaimlerChrysler, parent of Mercedes and now owner of The Chrysler Group, maker of Jeeps, Dodges, and Chryslers. Only Volkswagen sells more vehicles than either make, but when it comes to a predominately luxury line up Mercedes and BMW battle alone amongst German makes with Audi a distant third.
Unlike American automakers, Mercedes is not likely to engage in deep price cuts to draw in purchasers and “steal” sales that they might have made in 2006 for 2005 to stave off BMW. Still, buyers of Mercedes automobiles should find an even friendlier showroom in which to buy when they barter the price on their “C”, “E”, or “M” Classes of vehicles.
So, exactly what has led to the shift in sales? Well, published reports indicate that Mercedes sales continue to rise, but slowly. On the other hand, BMW sales growth are in the double digit class which is what has pushed BMW before Mercedes so far this year. Oddly, it isn’t the posh autos in each automakers’ fold that is spelling the difference. Unknown to many Americans, both BMW and Mercedes sell cars that are smaller and less opulent than the cars that appear in the states. Vehicles that compete squarely against Volkswagen’s Golf and offerings from GM, Ford, many Eastern automakers, and others.
Yes, it’s right. Not all BMW or Mercedes models are top end cars. Unlike in the USA where a Cadillac is solely a luxury car, both German brands produce cars for the rank and file driver too. It is these types of vehicles that have fueled both automakers expansion and is likely behind BMW jumping ahead of Mercedes.
To counter BMW’s surge, Mercedes does have an ace up its sleeve : the introduction of 1 or 2 smaller lines of automobiles to the U.S. Market by 2007. If you haven’t figured it out yet, Mercedes has “A” and “B” Class cars that are smaller and more cost effective than the present “baby” Mercedes, what we call the “C” Class. Mercedes hopes the US market is prepared for less pricey cars sporting the venerable Mercedes name and that these sales will push Mercedes back to the lead.
Of course, what is good for BMW as the automaker explores bringing its “1″ and “2″ series automobiles to the US to compete for sales. Both lines of cars are positioned against Mercedes “A” and “B” class autos and are the same vehicles that have bumped BMW’s sales figures up.
Now if only Mercedes would consider importing it’s SMART vehicle to the US market.
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