Benz boss eyes more growth after third year on top

Mercedes has claimed the NZ luxury sector for the third successive year – and it’s looking to 2018 being just as good.
Friday December 15, 2017

By Richard Bosselman

WITH a third consecutive year of prestige market domination in the bag, Mercedes Benz here is now looking to 2018 bringing potential to crack into a whole new level.

This desire has been expressed by brand boss Ben Giffin, who acknowledges the Benz path to maintaining as a big gun ahead of BMW and Audi at the end of next year has not been entirely to class script.

For one, the brand is again bucking the market trend in that its top-selling single model is a car, the C-Class, at a time when almost all other significant foes have seen their respective SUVs uplift to that status.

For another, he knows that he cannot count on the biggest thing from Benz coming in 2018 being of any assistance to his impressive passenger volume upward growth curve.

That’s because the impending and sure-to-star X-Class, being a utility, registers as a commercial vehicle.

For all that, Giffin – whose official title is general manager passenger cars – does not anticipate that Benz’s first one-tonner, which is drawn off the Nissan Navara but heavily revised, will not hurt his passenger volume, even though some editions will be tailored very much to put private owner play ahead of work.

But that’s in the future: right now, there’s celebration that it is looking great to keep the category crown.

The latest registrations data, to November 31, shows Benz with 2347 registrations, while Audi has 1916 and BMW 1818.

Audi has already exceeded its whole-of-2016 count, by 86 units, while BMW and Benz are behind but would seem to be on track to deliver better scores in the weeks remaining. Benz achieved 2482 registrations for all of 2016 and BMW had 1864.

What’s fuelling this, plus a trend of continual year-on-year growth that began six years ago? It’s more than this period being a boom market, Giffin suggests.

Speaking on a day when New Zealand media were in Melbourne to experience the updated version of the plushest and most expensive Benz builds, the S-Class (below), he says the product itself and the distributor and dealership dedication to excellence is also paying dividends.

“The advances Mercedes have made with technology have been amazing … whilst it is pleasing to see we are number one in the market, that is not the be-all.

“We certainly also have some other measurements and KPIs that we are very pleased with.”

Also, there’s now strong evidence that customers are not only being captured from other top-echelon brands but are also being retained.

“The pleasing thing for us is that our growth is coming from new clients. Sixty percent of buyers this year have been new to the brand. They are coming out of all sorts of models, not necessarily prestige. With the A-Class segment, they are also coming out of Japanese products.”

With the ute sector being so strong, it’s an utter certainty that X-Class will bring in many more customers, but he doesn’t think many Benz car owners will sell their road-bound wheels to achieve a taste of elevated and off-road tuned action.

“We see it (X-Class) as a positive addition to the Mercedes Benz family. It will bring people who we may not have seen before into our showrooms.”

With more than six in 10 new car buyers putting their cash into SUVs, doesn’t it seem surprising that the C-Class keeps on as the top-selling Benz?

The top-selling Audi for some time has been the Q5, the biggest selling BMW is the X5 and, for Lexus, the RX is the breadwinner. Jaguar is also seeing its F-Pace climb the ladder.

This time last year, Mercedes Benz NZ had expressed belief that the GLC would assume dominance by now. But it hasn’t – with 450 registrations to date, the C-Class has maintained a lead of almost 100 units.

GLC has been in limited supply and it competes in a massively congested sector, but are those the only reasons why the medium elevated wagon has not stolen the crown?

Giffin suggests the C-Class, as one of the country’s top-selling sedans full stop, is simply continuing to win because of its qualities.

The sales runs is “is a testament to that vehicle. The C-Class is one of the top four medium sedans in the country.

“Mercedes Benz invented the automobile 132 years ago and the passenger car is the foundation of the brand.”

As for 2018? “Well, there are some exciting things coming for C-Class and we certainly think it is the best car in the segment.

“Our goal is to maintain that lead in that segment. We’re not going to take our foot off the pedal with C-Class.”

Giffin doesn’t want to be drawn directly into conjecture Benz passenger volume could break 3000 units in 201, though it certainly seems to be trending that way.

“Regardless of the total number, we are always looking for growth opportunities,” he offers in response to that one. “We are extremely pleased to be recognised as the No.1 luxury brand in New Zealand for the third year in a row.”

He has suggested, too, that there is “a very good chance” that the total count when including its vans, the X-Class and heavy trucks could be above 4000 units. Given that, Mercedes’ local car sales count has always comprised two thirds of its total vehicle volume … well, you do the math.

“What we want to with the brand and the people we will touch with X-Class in the market, there’s a really great opportunity across all the Mercedes products that we sell.

“It’s more than possible, though it really depends on what happens in the marketplace and we need to allow the Government to settle in and provide an understanding of what their plans are for the future of the economy.

“I think that will really help settle the market … but, I don’t think there is ever a car manufacturer who wants to go back on their previous year’s results and we certainly do not want to.”

How much the S-Class will contribute to the cause has not been made clear, but the very top end of the luxury sedan market is certainly niche and has been eroded by SUV abdication over recent years.

For all that, Benz says the reason why it has reduced its potential selection from 12 models down to five, strengthened specifications and reduced comparable price tags, is more to do with giving customers a more coherent choice.

The line still starts with a 210kW/600Nm 2975cc six-cylinder diesel, the $176,900 S350d, and continues to top out with a Maybach edition, with the latter – powered by a 590cc V12 making 463kW and 1000Nm and commanding a $359,900 tag – retaining special order status.

Benz anticipates 80 percent of volume will be snared by the eight cylinder models, the S560 and S560L, which share a common 345kW/700Nm unit and cost from $219,900, and the S63 L, whose biturbo eight of the same 3982cc capacity cracks out 450kW and 900Nm. It costs $324,900.