China: Mercedes mulls 10 percent delivery jump for 2015 image

German premium automaker Daimler, the parent company of Mercedes-Benz – the world’s third largest luxury carmaker – has established a target of at least 10 percent sales growth in China for the year.

The company’s China boss Hubertus Troska advanced the figure during a meeting with reporters in Beijing and announced that the group’s Mercedes-Benz brand forecasts deliveries to surge past 300,000 units in China – the world’s largest auto market. Mercedes-Benz, which had trouble matching its bigger BMW and Audi rivals on the Chinese market, decided to overhaul its management and sales structure in the country recently and managed to lift sales in 2014 by around 30 percent. That growth overshadowed the overall market growth, which stood at almost 7 percent last year, after jumping 14 % in 2013. Additionally, industry trade groups, analysts and experts believe the Chinese auto market will continue to “normalize” after years of double-digit gains, with sales forecasted to surge another 7% in 2015.

Reuters also talked to people with knowledge of the matter that reported on Daimler’s decision to support its China-based Mercedes dealer networks with subsidies worth roughly 1 billion yuan ($160 million) after the latter were unable to fulfill aggressive 2014 sales thresholds called by the German automaker. That would fall in line with the BMW and Audi competitors, which have also made similar “support” payments to their own dealers. The latter complained that weaker then expected deliveries dented profits due to the slowing Chinese economy and the maturing of the auto market.

Via Reuters