Mercedes of course wants the G wagen to be a prestige vehicle. Just like Porsche isn't pumping out GT2s and GT3s to fill dealer lots.

There are vehicles that drive profits (GLA, GLC, GLE, GLS, GLB, etc.) and there are ones that build the brand image (G).

Once demand drops on the G wagen, they will pull back production. Even in the old body style they weren't flooding the market and filling dealer lots.

Same with Hermes, they have many other bags you can go in a buy right away (along with other goods) its just the Birkin and Kelly that drive prestige (and are limited in many ways).

 

Mercedes is not Hermès. It’s not an exclusive brand anymore - they're in the business to sell as many vehicles as possible and make shareholders happy. MB is now cranking out the G63 as fast as they can, which is why you’re starting to see the premiums drop, while Hermès has artificially controlled production of the Birkin for decades now.

The G63 hype is weighing down, production is at full speed and they will be more readily available and on dealer lots in the not too distant future, when the next “it” vehicle comes out - maybe the new Range Rover. Remember those were selling at $25,000 over list when they came out in 2013?

Not anymore. That’s what happen when production catches up to demand which absolutely *will* happen with the G.

 

Hermes artificially limit the production of their bags for the sole purpose of ensuring scarcity. They want it to be difficult for a buyer who wants one to actually purchase.

Mercedes is trying to get a G wagon into every person who wants and is able to afford one. With their current production volume, they will get there.

Porsche only applies the scarcity philosophy on cars like the speedster or 911 R. The 991 generation closed out with over 20K GT cars produced. Not exactly rare.

 

LOL The R is a super bad example since they screwed them with the 991.2 GT3 Touring....exact same car minus about 100k+ in cost.

 

Let me be clear, I don't think the mark ups will stick around for the G63 forever (or much longer.) But at the same time, I don't think (based on even the previous generation) it will ever be a vehicle that regularly gets discounted or be in surplus. The G Wagen is very special, otherwise why would MB spend so much on R&D to produce a new model on a bespoke chassis? There is no other SUV other than the new Aston Martin SUV that doesn't share a platform with another vehicle. If MB wanted to maximize profit and the ability to increase production they would have moved it to a modified GLE/GLS chassis and built them in Alabama.

Also just because something is scarce doesn't mean its prestigious see MB Sprinter 4x4s, very hard to get one with months of waiting and has been that way for years while you can go into a Rolls Royce dealer and get any models without any insane markups or waits. Does that mean a Sprinter is more prestigious than a RR?

Every company wants to maximize profit which means finding the right balance between supply and demand. Thanks to having more data and much larger markets (see China, Russia, etc.) it is much easier for automakers to produce the 'right' numbers compared to before (such as the 90s.)

This is really going off topic but this past fall I walked into a Hermes store in Paris and walked out with a Birkin for my wife as a birthday gift 20 mins later. Neither of us had ever shopped at Hermes before and I didn't have to jump through any hoops. Hermes very much wants to sell Birkins, they want to generate a healthy profit.

It is naive to assume that any company doesn't spend lots of time and energy to determine how to handle production v. demand especially those trying to sell luxury goods. It's a guarantee that many people even on this forum wouldn't have bought a G wagen if the dealer lots were full of them. But again, I will also agree that the mark ups will go away and in fact for most in-demand cars they are happening due to flippers, exporters, etc.