News

Mercedes plans drastic changes in its access models: “they will be more expensive”

The compact range of Mercedes is, and has been, the fundamental pillar on which the company has relied in recent years. The conversion of the Mercedes A-Class from utility to compact was a turning point for those from Stuttgart. Around the Class A derivative models such as the CLA, the Class A Sedan or the GLA have been born. An entire family that will now be analyzed in detail to calculate the next steps of the firm. Changes are coming to the Mercedes access range: it will be more expensive and less accessible.

In recent years the compact segment has lost importance in the markets. Estimates consider that segment C will lose 25% of sales between 2019 and 2026. The A-Class has been a mass success, but its sheer volume has made Mercedes earn less per unit. After the pandemic and the successive crises that have devastated the industry, the profitability of the range has stood at 14%, a figure that in Stuttgart they want to increase by making fewer units, but more expensive than the current ones.

The next generation of Mercedes access models will completely change the current paradigm. The Germans will eliminate units from the portfolio, leaving only those that are profitable in financial terms. As announced long ago, the extensive fleet of models has caused a problem with the names. Many names will disappear. Of the seven current body variants, only four will survive, although we do not know which ones will follow and which ones will fall by the wayside. Everything indicates that the GLA and GLB SUVs will remain, while the Class A Sedan could have its days numbered.

mercedes-benz-access-range_01
Mercedes plans to sell 25% less of its access models, but with higher profit margins.

As a fundamental part of this new strategy, the entire range will revolve around the MMA platform. The new architecture specifically designed for electrical units will be the one that shapes a revised family. Electric models will have priority, while thermal versions will have to be adapted to the MMA platform. Quite the opposite of what is currently happening with the MFA2 platform, with the electric ones having to adapt to it.

Improving performance for each unit sold is the great objective of Mercedes, and that goes through a two-lane road. On the one hand, as we have already said, the bodies will be reduced. Using a state-of-the-art platform will allow Mercedes to save costs while removing models from the catalogue. The other step (this one is not so popular anymore) is to raise the sale price. The A-Class and the access family models will rise in price considerably for the next generationswhich will make them more exclusive and expensive models.

The financial director of Mercedes, Harald Wilhelm has recognized that the profit margin has grown in the last year thanks to a reduction in the offer of models and the increase in price. The CEO of Mercedes, Ola Kallenius, has recognized that prices will increase in the future, making the path of Mercedes very clear in this particular strategy: “The entry point to the Mercedes brand in the future will be different from today.”.

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button