If you need further proof that the auto market is now one-sided for the high end, here it is. Mercedes-Benz plans to reduce its entry-level offer by three to 43 percent, adding an upmarket line of more exclusive cars than the Maybach. The bottom end of the market is simply not profitable enough, so the company is spending more than 75% of its budget on enticing customers who claim extreme luxury.
The strategy was outlined at a session called “Economics of Desire” in C ডিte d’Azur. Mercedes-Benz credited its shift to 2021 sales figures, which saw record-breaking sales of the AMG and Maybach models. In its flagship brand, the flagship sedan S-Class has grown by 40%.
These vehicles include the G-Class, EQ and EQS, in Mercedes’ so-called “top-end” category. Using 2019 as the baseline, the group will see 60% sales growth by 2026 if everything goes according to plan. Soon, this will include a series of “ultra-exclusive collector cars” called the Mithos series. Very little was revealed about the line, but production will be limited and the cars will only be offered to “the most dedicated enthusiasts and Mercedes collectors” Benz.
Additionally, the AMG.EA platform which is based on the vision AMG concept will be a key part of the top-end expansion, such as limited edition and collaborative specials such as Virgil Abloh Mebach (pictured) which had 150 units. Mercedes added that it is looking for ways to expand the G product family beyond the upcoming electric G-Class.
The next section below is called “Core Luxury”, which includes the C- and E-Class and their derivative models, as well as electric cars built on the EVA2 platform (EQE) and the MB.EA platform. A new e-Class will make its debut in 2023 to headline this segment.
Finally, and apparently, there is the “entry level” category, which currently includes A-, CLA- and GLA-class cars and crossovers. Elsewhere in the world, Mercedes sells B- and GLB-Class, as well as additional models from the A-Class, such as a wagon and hatchback. It is unknown at this time what he will do after leaving the post.
The rest will be built on the compact MMA platform, which will launch in 2024 alongside the MB.OS operating system. Mercedes-Benz plans to become fully electric with the sale of new cars According to a press release, 2030 includes “wherever market conditions allow” and “the ambition to be CO2-neutral by 2039”.
The change of strategy is a departure from the company’s former market share acquisition method that has created a model similar to the CLA. We see brands as specialized because they are moving towards an EV and possibly an autonomous future. As cars combine functionality and capability, companies need to rely on other features such as brand and exclusivity to differentiate.