To all intents and purposes Mercedes-Benz appears to be going mainstream with the upcoming A-Class. It’s a move that has shaken some investors who say the three-pointed star should only contend in the premium marketplace. Profit margins are traditionally not as flush on the lighter side of the C-segment (think C-Class) and Mercedes-Benz investors quite rightly love nothing more than to see a fat bottom line at the end of every quarter.
Chief Executive Dieter Zetsche says those voices have nothing to worry about, however, and that almost 90 000 orders have already come in for the Golf 7-competing A-Class. The new A-Class was launched in the summer and first European deliveries started in late-September; an impressive number given the economic crisis in Europe.
A month ago Mercedes-Benz added a third shift, with independent vehicle manufacturer Valmet of Finland, to meet strong A-Class demand. At that point, the company had received 70 000 orders, while at the same time it was alleged that Volkswagen had only received 40 000 orders for its Golf 7.
Dieter Zetsche says Mercedes-Benz will increase global car sales by 5% this year because of the A-Class and B-Class, versus last year’s 1.28 million units. By 2020, they want to double deliveries of Mercedes and Smart cars to approximately 2.6 million. Volkswagen and the Golf 7, you’ve be forewarned.
