Saturday, May 28, 2011

BMW, Mercedes-Benz Fight to Outsell Each Other in China

BMW, Mercedes-Benz Fight to Outsell Each Other in China
BMW may have outsold Mercedes-Benz globally in 2009, but the two German automakers are both vying to be the biggest luxury brands in the Chinese market.

For the time being, BMW holds that title. Over the past six years, its marketshare in China has grown from 16 to 23 percent, but BMW isn’t resting on its laurels. At the Beijing auto show, CEO Norbert Reithofer announced the company has increased its 2010 sales forecast (which includes BMW, Mini, and Rolls-Royce vehicles) by 20 percent, bumping the total to 120,000 units. In contrast, BMW sold 90,500 vehicles in China in 2009.

New vehicles tailored to the Chinese market -- like the new long wheelbase 5 Series sedan -- will likely help BMW achieve that goal, but the automaker sees the potential to grow over the long term. Reithofer believes his company can build as many as 300,000 vehicles annually in China, thanks in part to an expanded joint venture with Brilliance Automotive Holdings. BMW is expanding its existing plant in Shengyang, which builds the 3- and 5 Series lines, but is also building a second facility, which may build the X1 crossover for the market.

Daimler was a little less forthcoming with specific goals for its Chinese market strategy, but said it simply plans on outselling BMW by 2011. The automaker believes a number of products, designed exclusively for Chinese customers, will help propel it to the top of the sales charts. In addition to launching a new line of heavy-duty trucks for commercial clients, Mercedes-Benz will ultimately launch an electric car co-developed with Chinese automaker BYD, and a long-wheelbase C-class sedan.

Of course, these plans for domination assume another German rival -- Audi -- isn’t able to turn about its fortunes in China. Although it had been the leading luxury brand in the market for the last 20 years, Audi has seen its marketshare slip over the last six years, falling from 66 to 46 percent. Should the firm’s new A8L or the forthcoming A7 fastback resonate with Chinese buyers, BMW and Mercedes-Benz both have their work cut out for them.

Source: Automotive News; 1,2 (Subscription required)