With car sales in freefall in the U.S., Mercedes-Benz is moving to reduce its exposure in the vehicle segment.
The luxury automaker plans to jettison seven car models from the U.S. market, Mercedes-Benz USA CEO Nicholas Speeks told dealers during a webinar in late June. Speeks did not identify the models or offer a timeline, according to retailers who heard the presentation.
But according to a source familiar with the plans, there could be more than seven models. Those under consideration are the coupe and convertible versions of the S-, C- and E-Class nameplates, as well as the CLS coupe and one of the brand’s GT models, according to the source.
A Mercedes spokesman declined to comment on the brand’s U.S. product plans.
The portfolio paring is a significant sign of change for a global marque that built its identity on luxury sedans, coupes and convertibles. But U.S. demand for cars has slumped, as Americans flock to roomier and more practical crossovers. Luxury car sales in the U.S. declined 37 percent in the past five years, compared with a 73 percent increase in luxury crossovers in that period, according to the Automotive News Data Center.
Mercedes’ product pruning is geared toward reducing complexity and cost — for the company and retailers. The brand’s bloated U.S. portfolio — which one dealer compared to the menu at a Cheesecake Factory restaurant — has nearly doubled to 15 nameplates since 2000. Including engine variants and body styles, the lineup in the U.S. has ballooned to more than 100 versions.
Product expansion has made it harder for consumers to differentiate between models, and added complexity and cost for dealers, said Jeff Aiosa, owner of Mercedes-Benz of New London in Connecticut. “Reducing model proliferation is good. We’ve been asking for that,” Aiosa said.