Mercedes-Benz Malaysia is upbeat about 2017

By CARSIFU | 2 February 2017


EVEN when Mercedes-Benz Malaysia is already at the top of the game with record sales in 2016, there is no “resting on the laurels,” according to its vice-president (sales and marketing - passenger cars) Mark Raine in an interview with CarSifu recently.

CarSifu: 2016 was another fantastic year for Mercedes-Benz Malaysia. How do you view 2017 as many perceive this year as challenging in terms of business outlook and currency fluctuations?
Raine: Yes, 2016 was the best ever year for Mercedes-Benz Malaysia sales. It also saw the best ever month in June and best ever quarter in Q2. I am optimistic and confident about 2017. Why? To look at 2017, let’s do a re-cap of 2016. Last year, the market was already weak. But we bucked the trend, captured new customers and gained market share. We have an extensive strategic growth map, which constantly adapt to meet the demands of premium market customers here. Obviously, among the highlights of 2016 was our 17 product launches. Our product offensive was crucial last year. Traditionally, we are very strong in the limousine segment here. Now, the compact cars add a new flavour to the brand here, and also, last year, there were the sport utility vehicles (SUVs) and Dream Cars brand shapers. This makes the brand exciting, desirable and gives more prestige. Last year, we also opened the first-of-its-kind Mercedes-Benz City Store (in lifestyle and entertainment hub TREC Kuala Lumpur) which is an entirely new concept in the automotive environment here. And building on these, we will see benefits in 2017, in my view. So, we aim to outgrow 2016 numbers by bringing premium, superior service to our customers and also, gaining more fans for the Mercedes-Benz brand.

C: Can we expect another strong product offensive for 2017?
R: We will continue 2017 with the same speed and momentum in terms of launching new products. At the moment, we have 25 different models. While that’s not going to grow that much, we will bring new versions of existing products into the market. Among our success factors have been heavy investments in local production. In 2014, we were producing 3,500 units in Pekan, Pahang. In 2016, we produced 7,882 units. This year, we will introduce the new E-Class in CKD (completely knocked down) form. This will further drive the volume from the Pekan plant. This year, we will also see the new GLA-Class SUV.

C: In view of the weakened ringgit and currency fluctuations, would Mercedes-Benz Malaysia raise vehicle prices?
R: Over the past two to three years, we have not raised our prices because we have a long-term pricing strategy. That is very important because jacking your prices does not do any favours to the customer because it distorts residual values. We want market-adequate pricing. We want our customers to have the best possible vehicle resale value, which also reduces ownership costs and provides better peace of mind. I think the overall market is going to remain difficult. The fluctuations in the ringgit creates uncertainty and affects buying behaviour. I am not going to say we are never going to increase prices, but we are carefully observing the situation.

C: How did your SUV and compact car line-up fare last year?
R: They have been fantastic. In 2015, we sold only 23 SUVs. Last year, we sold 1,671 SUVs where 1,421 units came from the premium mid-sized GLC, and 250 units came from the full-sized luxury GLE. The locally produced GLC has really hit the market by storm. We kind of re-invented the SUV segment for the luxury/premium market. We want to position that segment as a lifestyle product. We did not want to position it as a 4X4 digging in the dirt. The customers want products that suit their active lifestyle - those that go biking, play golf, and like the outdoors. For instance, you can get into the GLE which is also my personal car; you can take easily two friends along and put three golf bags in the back. Also, our compact car sales have grown strongly. In the last two years, we sold more than 2,000 units of compacts annually. A fantastic result, especially when you consider that 2016 was a year in transition when we launched the facelifted A-Class. We are also seeing higher numbers of younger buyers for the compact cars, C-Class and the GLC which have young-ish, fresh and sporty designs.

C: What about your plans regarding after-sales?
R: Last year, we launched City Service which provides customers in the heart of Kuala Lumpur with a more convenient location. (The first Mercedes-Benz City Service by Hap Seng Star involves an investment of RM7mil, and this first full-fledged 3S facility offers the newly introduced Mercedes-Benz Service Differentiation; The Star Lounge, Premier Express Service, Drop & Go, and Door to Door Service.) Education and training of our staff is highly important and crucial to us in order to provide premium service. So going forward, we will continue to extend our network wherever we can; having more work bays, securing better people and introducing new concepts like My Service in order to provide the best customer experience.

C: How has the response been to the new C350e plug-in hybrid?
R: The order intake has been fantastic. For me, the Mercedes-Benz hybrids have two dominant topics. One, they are seen as sporty vehicles - which they are. The C 350e gives you an incredible 600NM of torque and the century sprint in 5.9 seconds which is a benchmark in that segment. Two, it is a high-end, luxurious car. That’s why we specified the car with unique options like Airmatic air suspension which you normally see in the top-of-the-range S 400 or GLE 400. And this is in light of the RM289,888 price tag on the C 350e. We were able to pass on the savings to the customer because of the tax incentives for locally-assembled hybrid vehicles. The C 350e is also a technology leader. Speaking from personal experience, I love the Pre-Entry Climate Control which I use to set a cooler temperature - say, at 22 degrees Celsius - before I get into the car on a hot day.

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