Mercedes-Benz widens global lead

Mercedes-Benz widened its global luxury-car sales lead in the first half of the year, setting back BMW chief executive Harald Krueger’s effort to reclaim the segment’s top spot.

The Daimler brand sold 1.14m cars in the six months through June, 14% more than a year earlier, on soaring demand for its revamped E-Class saloon and trendy sport utility vehicles. BMW, which is only beginning to expand its SUV offering and renew an aging lineup of saloons, lagged behind with a 5.2% gain to 1.04m vehicles.

Even though BMW says it is putting profit before volume, Mr Krueger has vowed to win back the luxury-car sales crown with the biggest product offensive in the company’s history. Last year, Mercedes overtook BMW for the first time in more than a decade with a fresh lineup and some all-new models, including the GLC coupe SUV, that have attracted younger buyers.

Volkswagen’s Audi subsidiary, hit by the growing diesel scandal and a dealer dispute in its biggest market, China, fell farther behind in the first half. The world’s third-largest luxury carmaker sold 908,950 vehicles, a 4.7% drop, largely due to a 12% decline in China. Audi is counting on its revamped A8 flagship, unveiled in Barcelona this week, to pull it back into the race.

“Mercedes has the better momentum as they have a relatively new palette of models,” said NordLB analyst Frank Schwope. “It’ll be a tight race in coming years and even Audi isn’t a lost cause, but this year Mercedes will stay on top.”

Sales of Mercedes’s latest E-Class surged 68% in the first half, and demand for its SUVs gained 13%. BMW’s X1 SUV was its biggest growth driver in the period.

Mercedes’s star has been rising since chief design officer Gorden Wagener led a radical redesign five years ago, which introduced jutting grilles and broader haunches over the rear wheels, transforming the marque’s image from stodgy to sporty and giving it the edge it needed to surpass BMW and Audi. Mercedes also got a boost from finally jumping on the SUV bandwagon.

While Mercedes has been surging ahead, Mr Krueger’s had to wait out BMW’s redesign cycle, and the revamps he’s overseen have been conservative. In February, BMW launched the first fully updated model under the CEO’s rein — a new 5-Series saloon that hid its most interesting innovations under the bonnet.

All that has pushed BMW farther behind in the luxury-car race; the Munich-based carmaker sold 106,244 fewer vehicles in the first half than Mercedes, versus a difference of 89,818 cars in the five months through May.

Bloomberg


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