Mercedes hurt by another weak sales month in China

FRANKFURT Tue Nov 6, 2012 11:44am GMT

A Mercedes-Benz logo is seen on a displayed car is displayed on media day at the Paris Mondial de l'Automobile September 28, 2012. REUTERS/Jacky Naegelen

A Mercedes-Benz logo is seen on a displayed car is displayed on media day at the Paris Mondial de l'Automobile September 28, 2012.

Credit: Reuters/Jacky Naegelen

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FRANKFURT (Reuters) - Daimler's (DAIGn.DE) flagship premium brand Mercedes-Benz overcame another weak month in the key growth market of China to sell 6 percent more vehicles in October and mark a fresh record for that month, the company said on Tuesday.

Including the 109,632 vehicles Mercedes sold last month, volumes rose by 5.1 percent to about 1.07 million cars in the first ten months of this year.

"We expect a new all-time best for sales in the full year," said Mercedes sales chief Joachim Schmidt in a statement.

Despite the seemingly positive news, Mercedes continues to heavily lag larger German premium brands BMW (BMWG.DE) and Audi (VOWG_p.DE), which are growing far more rapidly in China. Each had already sold roughly 1.10 million vehicles before the month of October even began.

China remains the Achilles heel of Mercedes. Sales actually fell 3.9 percent to about 15,900 vehicles last month, a decline which Daimler attributed to the "very strong" sales from October 2011.

"With the full availability of the high volume B-Class that was only recently introduced in China, the company expects an added growth impetus in the coming months," Daimler said, adding it also was working to reorganise the sales operations in China.

The roomy Mercedes B-Class compact tourer was launched in China in August. According to Daimler, the sportier A-Class compact hatchback is expected to debut in China in the middle of next year.

Daimler added that sales of its diminutive Smart car rose 8.1 percent in October, lifting the cumulative sales growth to a still tepid 2.4 percent, or 87,961 cars during the first ten months.

(Reporting By Christiaan Hetzner)

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