Reference Auto

With BMW bringing in the Mini, Mercedes-Benz is not sitting idle, targeting a five-figure annual sales in India, and owing to the intense slugfest with rivals, Mercedes is planning to drive in its small cars to India in order to cater to the largest segment of the car market in the country (the smaller cars category).

CEO and managing director of Mercedes-Benz Peter Honegg had a few days ago said that the luxury auto giant may bring into India small cars like the B-Class and A-Class as these cars could have a “huge potential” in the country’s market.

In fact, the country has been offering a mega market to small cars all along. Only companies like Maruti Suzuki, Hyundai and Tata Motors realised this and raked in the moolah.

Though late, companies like Honda, and makers of luxury liners such as BMW and Mercedes-Benz finally seem to have realised the potential of small cars in India.

These companies now know that the only way to scale up profit is by going into the volumes market in a big way. The result: cars like the Honda Brio, BMW Mini as well as Mercedes plan to bring in small cars like those in the A-segment.

But even after Mercedes-Benz and BMW enter the small cars market, they can only shore up profits when they play in the compact car category. That is, these luxury car makers must make cars that are priced within Rs 5-6 lakh or less than Rs 10 lakh for that matter.

Currently, even the “small cars” made by these companies could be priced over Rs 20 lakh and may not help the German duo to scale up profits substantially.

Meanwhile, the cars Mercedes-Benz plans to bring into India are from the A-Class category, which is the company’s entry-level car in most markets. Then, the company is also bringing in another small car range, the B-Class car, which is a family car.

Honegg revealed that Mercedes will bring in an upgraded B-Class car along with the A-Class, which would most likely be available in two years.

So far as the compact SUV goes, Mercedes is contemplating introducing the GLK, which will vie with BMW’s X1 and Audi’s Q3. But a right-hand drive version of the SUV could take some time (a year at least, which is a dampener).

Mercedes-Benz sold 7,400 cars in 2011 compared with 5,600 cars in 2010. But BMW had overtaken Merc’s last year’s sales in October 2011 itself. From January to October, it sold 8,042 cars.

As per the latest news, Audi has dislodged Mercedes-Benz in 2012 sales so far. Mercedes sold 2,130 cars during the first quarter of this year while Audi logged sales of 2,269.

So, there is an urgent need for Mercedes-Benz to pull up its socks and the only way it can do so is by bringing in its A and B segment cars early and pricing them very competitively compared with BMW, so that Merc can compete on the volumes front to rev up profit.