Daimler's Mercedes-Benz sees double-digit growth in China market

Fri Aug 30, 2013 2:57am EDT
 
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By Norihiko Shirouzu

CHENGDU, China (Reuters) - Daimler AG's Mercedes-Benz expects to see growth of up to 15 percent in China's luxury car segment this year, a senior executive said, and is trying to grab a bigger share of that market by expanding into the inland-west and smaller cities.

The company plans to open 75 new dealer outlets this year, nearly half in third- and fourth-tier cities, said China sales head Nicholas Speeks, as part of a broader turnaround plan to reverse its recent struggles in the world's biggest auto market.

"We are a little bit lagging behind our principal competitors in terms of outlets opening," Speeks told reporters at a news briefing to outline the German brand's strategy at the Chengdu auto show on Friday.

"In the past we have been concentrating on Beijing, Shanghai (and other major markets along China's coast). We recognize one of our shortcomings is the fact that we need to expand our dealer network."

The network expansion is a key component of Daimler's (DAIGn.DE: Quote) strategic plan to invest 2 billion euros ($2.67 billion) in China over the next two years.

It aims to boost sales of Mercedes-Benz cars by a third to more than 300,000 cars a year by 2015, from this year's forecast sales of 230,000 cars.

If achieved, the target would make China Mercedes-Benz's biggest market globally. Currently, China is the brand's No. 3 market behind Germany and the United States.

Speeks said China's economy remained "fairly healthy", despite a slowdown in growth.   Continued...

 
People looks at Mercedes-Benz cars during the the 15th Shanghai International Automobile Industry Exhibition in Shanghai April 21, 2013. REUTERS/Carlos Barria