Daimler AG Chief Executive Officer Dieter Zetsche issued a challenge to BMW and declared that by the end of the decade Mercedes-Benz will knock off BMW as the world's biggest luxury car manufacturer. On a recent interview with Wall Street Journal, Zetsche stated his company's plans and vision for the years to come.
Back in 2005, Daimler AG's Mercedes-Benz lost the global battle to be the world's foremost manufacturer of luxury cars. Currently the company sits in the third position just behind its fellow German company Volkswagen.
The reason for Daimler's decline is its loose stranglehold of the Chinese market. Both BMW and Volkswagen have already imprinted their names in China's luxury car market and they are making headways as well. China is the world's second largest economy next to the United States. Since China's opening to the rest of the world, it has become the target of western companies for expansion as there is a greater potential and low competition.
According Forbes, Audi and BMW is accountable for more than 60% of China's overall luxury car sales. In fact Audi outsold Mercedes last year by nearly twice the amount of total units sold. Despite these, U.S is still the biggest market of Mercedes-Benz. Based on the sales figure last year, it shows that Mercedes-Benz covers more than one-fifth of all the luxury cars sold in the U.S.
On the interview with Wall Street Journal, Zetsche revealed that they are planning to release 13 new models before 2020. Zetsche also emphasizes that Daimler also focuses in the development of self-driving car.
The latter part of 2014 has been a tough battle for luxury car manufacturers. In Europe, Russia's economy is in the brink of recession and China's economic growth is slowing down if not completely on halt. These recent development in the world's economy could pose a big threat on the overall sales luxury cars.