Mercedes-Benz to Move Upscale, Drop Some Entry Level Models
Mercedes CEO Ola Källenius claims the Mercedes-Benz entry level model portfolio is about to be trimmed.
Mercedes has always been about “The Best or Nothing.” Well, according to CEO Ola Källenius, Mercedes efforts on making the best cars means they are moving the entire brand image upscale.
According to Bloomberg, Källenius stated in an interview that the Mercedes offerings in the entry level market are going to be trimmed significantly. “Today we have seven models in that [entry level] segment; in the future we will have four,” he said.
At MBWorld, we’re not quite sure which models this may or may not affect. World wide, Mercedes offers the A-class, B-class as entry level models. Both have a home in any respective market, but perhaps the A and B are so close that they can share a platform in the future. We’re not sure if SMART, still sold in Europe, will be part of the culled models. We’d guess SMART will not be affected, since they are an EV brand. There’s also the T-class, which is a small utility vehicle, but being made for commercial purposes, this model might not be considered entry level.
In the US, the A-class is the current “baby benz.” According to CarSalesBase, sales numbers for the A-class are slipping in the US. We’d imagine if any car is going to get cut, it would be this one. Perhaps the CLA would go with it, too. But the GLA may stick around for a little longer.
Regardless of which models get the purge, Mercedes isn’t interested in an all-out sales war with BMW and Audi. Upper end luxury models have bigger margins anyway. With the current automotive sales market, Mercedes stands to do far better by selling S-class models at higher margin, than A220’s at scale. Luxury Maybach concepts being rolled out now speak of the bespoke direction Mercedes could head as a brand.
Bloomberg points out that Mercedes plans to increase flagship sales by 60%. So those S-class, Maybach and G-wagen models are about to get a bit more popular. AMG models would likely see a bump in sales, too. And wiht the push for electric, the EQ line will also see an uptick in production. The best, or nothing.
Photos: Bloomberg
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