Oh Lord, won’t you buy me a (small) Mercedes-Benz
Three days before she died in 1970, American singer Janis Joplin recorded in song a request to the Almighty to procure her with a car from the famous German luxury automaker, a colour television, and a “night on the town”, wailing that these materialistic items were needed to keep up with her friends who “all drive Porsches”.
Over 40 years later, Joplin’s “Mercedes-Benz” is still in rotation on oldies radio, and the German automaker’s cars (and Porsche) still vie for the same, status-seeking upscale customers as in the singer’s day. However, as a response to tighter fuel economy and tailpipe regulations, and an existing customer base that is growing older—quickly—Mercedes is joining its German luxury car rivals in attacking the type of small car customer that mainstream brands like Mazda or Honda already have covered.
Just last week at this year’s Frankfurt auto gala, Mercedes unveiled its next-gen compact B-Class four-door hatch, seen above with parent Daimler head honcho, Dieter Zetche. And although Canadians have been buying the original B at a rate of about 3,000 units per year, the next model precludes a whole family of new, small ‘Benz’s based off the B’s platform, and eventually, the even smaller A-Class.
And in a recent chat with The Crank, Mercedes-Benz Canada’s new President and CEO Tim Reuss (seen here on the right, taking the "torch" from his successor, Marcus Breitschwerdt, who now heads Mercedes-Benz UK., with Dr. Joachim Schmidt, Executive Vice President Mercedes-Benz Cars Sales and Marketing, Daimler AG, in between) is counting on these small Mercedes to sell at a higher annual rate than the current B.
A lot higher.
Whereas the more traditional compact C-Class sedan and GLK-Class crossover make up the majority of ‘Benz sales in Canada, Canada’s number-one luxury brand last year is betting that smaller, more fuel efficient—and perhaps more important for younger buyers—and less expensive cars are the way forward.
“In the future, these small cars will be the core of our product lineup,” said Reuss.
Following the new B-Class— debuting this year in Europe and set to go on sale in Canada next year—Reuss said the new family of front- and all-wheel-drive compact cars will include a four-door crossover in 2013 and a four-door coupé (think mini-CLS-Class) in 2014.
After that, the subcompact A-Class, currently seen only as a two-door hatchback in concept, arrives in 2015.
Despite Mercedes previous lack of presence in the small car market, Reuss is adamant that these new Bs and As won’t cannibalize sales from existing larger Mercedes models. In fact, he believes that ‘Benz’s new fleet of small cars will attract new buyers to the brand from “near-luxury” makes like Acura, Lexus and Infiniti.
“We’re targeting everyone, young males, older females”.
Reuss has reason to be optimistic. As Canadians have proven in the past, we like small cars. Its why the Smart ForTwo went on sale here four years before the U.S. got it, and the original B-Class in 2006, which the States still don’t get. But Reuss knows success in Canada means more than just dumping a bunch of small cars into the market.
In a recent cross-Canada tour that saw him visit every Mercedes dealer in Canada, Reuss realized how diverse new car buyers are here.
“In Toronto alone, you have at least five distinct markets,” remarked Reuss.
German-born, the Mercedes executive has had plenty of experience in diverse, international markets. And he readily admits one of his biggest challenges going forward will be to manage future growth simultaneously with Mercedes expanding its lineup in Canada AND sustaining its luxury segment leader status.
From a logical standpoint, the forthcoming gaggle of new Mercedes’ seem to be where the majority of luxury car buyers are heading. Yet any time any automaker ventures into a new segment, there’s a certain amount of risk.
In a nutshell: If Joplin was alive today, would she be wishing for a Mercedes B-Class?
And how do you feel about paying a premium price for a Mercedes-badged car, compared to less-expensive-yet-similarly-sized cars from near- or non-luxury brands?