Mercedes Benz, Daimler’s motor vehicle division, once a king in the European automotive industry, is watching from the sidelines as BMW and Audi pull away from the crowd. Since 2010, both BMW and Audi have grown considerably in terms of sales and profit, and are only growing. While Mercedes is roughly at the same amount of shares as in 2006, BMW has doubled. Evidently in China, home to the world’s largest automotive market, BMW outsells Mercedes by 70%, and Audi 100%. With all of this, current CEO Dieter Zetsche still believes they will become the world’s number one premier carmaker by 2020.
If Mercedes is truly looking to reach this goal by 2020, they must address a number of reasons. Firstly, they must look at their brand positioning: what is the point of difference of the products they offer? At the moment, BMW and Audi are destroying them in every car class possible. Mercedes claims to be a high-class luxurious auto maker, but at the same time, the poor quality and reliability that they offer cannot justify the premium prices that they charge.
The second issue they must address is the expansion of their brand into China, the world’s leading automotive market. BMW and Audi have already settled nicely with local firms, but MB has yet to make a favourable deal. The company must set up a successful network of outlets to catch up to the already settled BMW and Audi.
Although their goal seems to be far fetched at the moment, with the right guidance and adjustments, the Daimler company may not have to stay in third for long.
http://www.reuters.com/article/2013/08/30/us-china-autos-mercedes-idUSBRE97T02920130830