The profit is huge! It looks like the strategy from MBUSA is to limit certain models to the US to increase their margins. In my opinion they are “playing” with the product mix and the timing of when certain models are shipped to the US—of course they have been doing this for years. It is interesting that when the w222 first came out s63s were stocked in inventory all over the country and now there is limited inventory with a lot less being shipped to the US. Daimler has been on a mission to increase margins across the board. I have no facts about the US strategy but Dieter Zetsche (Daimler CEO) has stated in the past that one of their goals is to increase margins. It also looks like they limited the numbers of 2018 S560 and S63s to the US market to increase margins and to use the S450 as the volume leader for S Class cars while the S560 and certainly the S63 are the increased margin leaders. Speculation on my part but something is up with their lack of dealing as you mentioned.

I agree. I am also interested in a new S63 but I also don’t want to get rid of my 16 S550 4matic that I ordered with every option except the 3D sound system—so I am torn. I spent almost 2 weeks this past summer driving a ‘17 S63 in Germany and Switzerland and absolutely loved it. But I will not buy one with the type of deals that are out there now. So I will probably just keep my ‘16 on my normal 5 to 6 year cycle as I have for the past 25 years. But if dealers were willing to deal I would consider a new S63 now—but not going to happen with the constraint on the numbers being allocated to the US.

You are welcome!

In reality no one wants to take a depreciation hit but it is a fact of life with S Class cars and other high end cars. Even if you buy one with half the depreciation already taken, then you still have considerable depreciation to go. It is all relative to how one thinks and their respective net worth.

The best MB purchase I ever made was over 25 years ago when I bought a used E class with 100,000 miles on it. I put another 100,000 miles on it and sold it for $2000 more than what I purchased it for. I guess I am now making up for that gain with my S Class loses.

Yes it is always better for the sales person and the dealership to lease especially when the standard interest rate on a 18 S63 lease is around 6% APR (.0025 money factor) according to Wolfman. The person leasing takes the big hit on depreciation on the lease AND pays MBUSA 6% on the “borrowed money” in the lease.—oh and they can sell that nice S63 and in about three years again for another profit! Like most things, it depends on many factors whether it is better to pay cash, buy and finance, or lease. The sales person also could have said it is much better to buy a used S63 after it comes off lease. That dealer is just looking at it from their perspective and not yours.

I did not take a scientific sampling of what I am about to say but of the three carfax’s I clicked on from autotrader for 15 S550 4matics for around 50k, two of them had accident records and the other was extremely high mileage. So I think you are a bit off the mark here unless you want a high mileage car or one that has been in an acccident.

Superpop,

No but what about damage or an accident? I said either high mileage or an accident. You just proved my point. The car you picked was in an accident or had a damage record. You simply picked the lowest priced car in autotrader. If I picked the highest priced car it is about $79,900 with 17,224 miles for a ‘15 S550 4matic. So we both know now that we can both pick the high and the low prices so we have a range.

You originally referred to your 3 year old W221 in the mid-40’s. Even during summer a good 3 year old W222 will be $60k unless you are looking for a bare bone or less than desirable model.
Buying used means you can take advantage of lower prices for well optioned cars.
There are plenty of cheap accident or salvage cars for the low ballers out there

I think in general, the SClass is for people who aren’t thinking about profit margins or residual values. And fleet emissions regulations have meant fewer SClass or SLClass AMG models get built — new guzzlers sitting on the lot is the worst of all worlds; lower initial margin, lower resale value and a higher fleet emissions average. MB learned that during the Obama years (basically the W221), so now we see the scarcity, increased prices and margins.

All this fits with MB long term strategy for this car, I think, which is this: as long as the SClass pays for its own development costs (because its typical buyer doesn’t care), anything else is gravy. The real “profit” comes in moving that developed and paid for technology down to the EClass, CClass and the other now dizzying array of models, where many more units are sold. So you have “free” SClass technology in half the E, C, GL, SLK, GLE and whatever other model they can stick it in, and when those cars or sold or leased, that free technology “cost” becomes pure profit. Recall that parktronic, distronic, keyless go, etc., all the way down to the Burmeister sound system, were all developed (and the development cost paid) for the SClass. And now it’s everywhere.

Just my view on how MB views “profit”. This is all separate and distinct from how the dealers view profit. They want you to lease, not buy, service it there so they can swap half your oil and charge you for all of it, fix things on warranty and bill MB full freight for it (more frequent on SClasses, by the way), then have you “rinse and repeat” with a new lease while they “rinse and repeat” by selling your car again for a profit, with a new service customer, etc.

It’s all a racket, but: (1) the scarcity of S AMG models enhances these effects; and (2) cars that fall out of this loop (autotrader, cars.com, bring a trailer) are cheaper. They’re also generally less desirable but not always. A less desirable SClass in the MB profit and dealer feedback loop is still a damned good car, all things considered, unless it’s been wrecked (in which case all bets are off).

maw

PS, those same fleet emissions rules have meant more turbo charged engines, which basically took me out of the S AMG market after my ‘06. I still may hunt an M156 “6.3” car, but it won’t be an SClass. And as much as I love the look of the W222, I’m just not into the driving experience of twin turbo cars (having driven the 65s and twin turbo Porsche’s, all of which are in my opinion the best turbo charged cars money can buy). I’ll keep my old fashioned “right now” power.