Mercedes-Benz’ U.S. Chief Predicts Record Sales in 2012

NEW YORK – Stephen Cannon, president and CEO of Mercedes-Benz USA, predicts the importer is on its way toward breaking the sales record it set in 2007.

Without offering a specific figure, he forecasts the auto maker will surpass the 253,000 units sold five years ago, before the worldwide economic crisis. Sales in 2011 totaled 245,231, and deliveries have increased 24% since October.

What drives those numbers is that Mercedes boasts one of the youngest portfolios in the luxury segment, Cannon contends. “We have a dynamic product lineup that's already produced record-breaking first-quarter sales of 61,000, up 15.3% over 2011.”

That surge makes the U.S. the world’s biggest Mercedes market, surpassing Germany, according to Joachim Schmidt, head of global sales and marketing. China ranks third, followed by the Middle East.

The all-new SL goes on sale in mid-April, followed later in the year by new GLK and GL models. That's only the beginning of a new-product blitz.

In the next four years, eight new Mercedes products in segments where the brand does not now compete will be introduced. A new, small entry-level A-Class is under discussion for import into the U.S.

“We're going to expand the S-Class also,” Cannon says. “There will be expansion up and down our model lineup.” He also promises Mercedes will introduce new coupes and convertibles. “We can get a bigger share of the (luxury) market in the U.S. That's part of Daimler’s growth plan globally.”

The Mercedes chief does not fear growing sales will impair the exclusivity of the luxury marque. “An expansion that keeps the virtues of the brand” is healthy, Cannon suggests, adding, “Our brand wouldn't be what it is today if we had not introduced the 190 at the low end of the portfolio.”

That's why he's confident other entries below the C-Class won't harm Mercedes’ cachet. “A measured and smart expansion to make our brand more accessible is essential.” 

The skyrocketing cost of gasoline isn’t as crucial in the luxury segment, Cannon says. “Fuel prices are less of a factor for our customers who have seen this movie before. They've been sensitized to it.”

He notes that California, the best-performing Mercedes market, is confronting $5-a-gallon gasoline prices.

Mercedes continues to command premium prices over its competitors globally, Schmidt says. The premiums range from 3%-5% more than comparable BMW models and 5%-8% more than Audi. “It depends on the car line.”

The flagship Mercedes S-Class still leads the BMW 7-Series in sales, even though the S-Class is in the final year of its current lifecycle.

Schmidt expects the U.S. will remain Mercedes’ top export market for at least several more years. Sales are improving in China, but at a slower rate than expected. Northern Europe is doing well, but Southern Europe lags.

He's confident overall light-vehicle sales in the U.S. will exceed 16 million units annually by 2015. “We can feel momentum and traction in the marketplace. There's pent-up demand and, barring a global economic crisis, a 16 million market doesn't feel as far away as it once did.”

Schmidt predicts the luxury segment will grow at a slightly higher rate than the overall market by 2020.

Mercedes’ future growth both in the U.S. and globally will be helped by new entries in the compact SUV segment. “We see big potential in that segment,” he says. “It's important that we make them fuel-efficient.”

Diesels continue to play a big role in European sales, showing penetration of 50% in Germany and more than 80% in France. Diesels in the U.S. account for slightly more than 15% of deliveries. Mercedes does not sell diesels in China because of regulatory issues.