Mercedes Follows Ford?

[hawk20]

I find it truly worrying that Mercedes are putting the new 3.0 litre diesel engines in the Chrysler 300c selling for £25k compared with goodness knows what for a 320cdi E class. Here beginneth the first lesson in badge engineering. First the engine and gearbox and then on and on from there. Till Mercedes begins to mean less and less. Like Austin/Morris as BMC who gradually wrecked luxury brand after luxury brand -Wolseley, Riley, MG and finally Rover. Once we all learn that the Chysler has the Merc engine, gradually, gradually, it becomes why buy the Merc. Drive a 320 cdi S class, E class or C class and the engine is sheer joy but what will be special about it when we all know it is in cheaper mass market cars?

The pimple heads who now run Mercedes are already wrecking everyone's residuals by turning Mercedes into a discount motor car. Before the E class face-lift arrived in July my dealer was giving £4400 off the saloons. Now while awaiting the new CL, dealers are offering up to £15k off the present model. Barmy! Think what that does for the price of one year old CL's, and then two year old ones and on down the line. Toyota and Lexus make just a few cars less than the market wants and avoid major discounting. Mercedes now keep making a lot too many and end up having to nearly give them away. When I bought my first Merc if a dealer gave a discount he lost his dealership. Dear to buy but what residuals.

In April I bought a December 23rd registered 220 series S class, listed at £56k new, for £39k (about 30% off the new price or £17,000 depreciation in the first 4 months). Great for me. Hell if you buy new. Fords have ruined their markets by discounting and getting known for lousy residuals. They even wrecked Jag residuals by selling cheaply to fleets in the US. Now Ford sell less Mondeos per year than BMW sell of the 3 series! So do we now have to watch Mercedes doing all that went wrong at BMC/Leyland/Rover; plus all that has gone wrong at Ford? Copy success by all means, but only the truly stupid copy failure.

 

[jberks]

To be fair, I struggle to understand why anyone would want to buy a new merc. Sure it's a nice feeling but as you and I know well, the depreciation over the first few months is astronomical. Mine dropped over 25% from list in 10 months, though I don't know what it was invoiced at originally so perhaps it wasn't quite as bad.
The rule is simple, either by newsed or get a substantial discount in the first place. List -2% just won't cut it anymore. Even with mine, having had it for only 9 months, I've probably still lost a packet since. I suspect if I tried to trade in, I'd be offered 7-10k less than I paid, hence I will be keeping it for at least 4 years and possibly longer.

Whether cross polenation of components is a bad thing however, I'm not sure. You get the same engine in an Octavia as you do An A6 or a TT. Done carefully, it seems to drag the lower brand up without damaging the upper brand. Sure, some will switch, but provided there is still a real difference between them, few will be swayed. To be fair, the 300C is based on the 210 and looks like a yank tank. If you want 211 looks, style and handling, there is still no alternative to the E. Plus, and I know many deny it, but no one buys a merc solely for the engineering.
As I've said many times before, if I did, I'd be buying 9 month old Mondeo Diesels (for 8-10k), running for 3 years and then swapping for another. I'd lose around 6k over the period which is less than I've lost on the E in 9 months, the maintenance would be a fraction, in terms of build quality, ride etc it's 80% of the merc which is good enough, and in terms of longevity, who cares - it's gone after 3 years anyway.

We are all badge snobs to some extent.

 

[hawk20]

Wise words. Lot of sense in all you say. Having got 25% off for the first year of its life, provided Merc don't wreck our residuals too much, you get around 50% of new price when 3 years old. So that's 2 years for 25% depreciation. The new buyer gets 1 year for 25%. And. of course, as you say, if you buy under a year old for 25% off and keep for 3 to 4 years, or more, the depreciation is greatly reduced. That is exactly my plan too. And with Service Plus covering almost everything from 3 to 6 year olds up to 120,000 miles, it is now possible to have peace of mind too.

Yes I accept that somehow Audi/VW have to some extent got away with common components. I suppose I can't bear the thought of my lovely 320cdi engine and gearbox being in a mass market car. Doesn't seem right. Somehow the engine is -well- the engine of the whole thing. They are bound to lose SOME E class sales to the 300C. Some will be tempted by the same engine at 25k instead of 35/40k. And no doubt then the Jeep will get the same engines as the ML. Looks like a slippery slope to me. But we'll see.

 

[hawk20]

Sorry to come back so soon but just seen a Merc dealer selling the outgoing CL500 model for £27,000 below list price. Several others are being offered by dealers with under 100 miles on the clock for around £20k off. Lunacy and sheer murder for owners' residuals.

http://www.mercedes.co.uk/emb_car_apps/used_cars/SGDetails.asp?SearchID=18220361&vid=1428946&Req=ALL

 

[SLinKyjoe]

I would think, unlike BMC, mercedes platform/engine sharing with its partners would not really effect sales of either type.

Mercedes is a premium brand, where as Chrysler isnt. producing cars with different bodywork but same engines/chassis etc, will hit differing markets. The Crossfire is based on the old R170 SLK. it may compete in the same market as the R171SLK but it is priced to undercut it and as such isnt as sporty as the R171.

Mercedes also is just that, Mercedes! they have different models but one brand. Chrylser have dodge, jeep and a few others that i have forgotten. They were struggling due to the same reasons as BMC was. They produced cars in different factories that competed in the same market. Mercedes merged with them to expand Mercedes so it would not be a victim of a takeover. it should work out okay.

You will notice that BMW have not marketed the MINI as a BMW MINI. again its brand awareness, but BMW MINI would not sell as well as MINI would. Some people just would not buy a BMW. They have done the same with Rolls-Royce.

I would have been more inclined to suggest that the new Jeep found its way to becoming the latest ML rather than a new jeep being a rehash of the old ML.

Skoda being Low end, SEAT being low to middle small cars, and Golf being cross low/middle and a bit upper and Audi being middle upper excutive, the model has been working in germany for some time. I would suggest that Mercedes have stole the idea from VW rather than Ford.

Seems Ford are about to offload Jag and Landrover. so once Astons stop selling they will be up for sale as well. Ford are brillaint at making the right decison at totally the wrong time. They have now produced a family MPV smaller than the Galaxy and called it a smax. Not the choice of name you would associate with Children. They do all their decsions making using bean counters. this is one reason why they make such cak half the time. if they were left alone to concentrate on actually knocking out decent cars they could. but they are not allowed.


And just one other point, your analgy looks worrying, but BMC was formed by a governement which wanted to keep people employed. market forces were not at play. that is the reaosn all them names went down hill. Never let a government meddle with market forces. Look at Lada as an example!

 

[jberks]

Sorry to come back so soon but just seen a Merc dealer selling the outgoing CL500 model for £27,000 below list price. Several others are being offered by dealers with under 100 miles on the clock for around £20k off. Lunacy and sheer murder for owners' residuals.

http://www.mercedes.co.uk/emb_car_apps/used_cars/SGDetails.asp?SearchID=18220361&vid=1428946&Req=ALL

That's the way the cookie crumbles. Bargain for someone though. Golden rule, never buy a new car when a replacement is just around the corner, unless you get that massive discount. Then again - I'll never buy a new car again anyway. That said, I suspect the residuals will bounce back to some extent, once the old stock has filtered into the market and the new one comes out with no discounts. Rather like the current S, they will have something of a resurgence. Just makes that one an even better deal.

 

[Jay Kilby]

intresting thread. but i think we have to understand the mainstream mass market car companies have toproduce a certain amount of cars per day/hour to sell them at a price people can afford. the problem is with at least 4 mfr's producing similar amounts of carsthey are simply oversupplying the market...hence fields of un sold cars. add to this in countrys like the U.K. the unions have so much say on things like pay and benafits mfr's cannot say well we are going to reduce capacity by 30% and loose 30% of the work force because of the uproar it causes. they end up simply moving production compleatly. now please do not take offence anybody as none is intended but i think it is silly that a man can stand on an automated production line with no qualifications and expect to earn the same as an engineer who dedicated his early years to education to qualify as a specalist engineer.
Mercedes will always hold prestige, lets hope they do not follow BMW having driven the new 3 series and the latest Mondeo there really is not much in it?

 

[blassberg]

VAG are managing this very well

 

[hawk20]

VAG are managing this very well

Yes, Charlie, no doubt about that in the short run. But note how many are now buying Skodas and Seats as cheap ways to buy a VW often guided by the motoring Press. What does the long run look like? If you have a VW Sharan and a Seat Alhambra (really Sharan) and all the main parts are common can they go on being different prices once everyone has twigged they are the same? And then what? If the prices become the same we all buy the VW -the 'better' brand. Or as BMC did you drop the names Austin and Morris and call everything a Rover.

Now, read Andrew Frankel in the Sunday Times saying of the Chrysler 300c if only it was "called a Mercedes" they would be queuing down the road for it.
Well here is the news folks. It is not called a Mercedes but there is now a 3-4month waiting list for one in the UK --- and there isn't a 3-4 month waiting list for an E class. The public are very canny.

In the long run, the issue is will the public see the mass produced Chrysler as really almost a Mercedes OR will they see the Mercedes as really just a mass produced car like the Chysler. It really does matter which; and it's not an easy one to call.

 

[SLinKyjoe]

Yes, Charlie, no doubt about that in the short run. But note how many are now buying Skodas and Seats as cheap ways to buy a VW often guided by the motoring Press. What does the long run look like? If you have a VW Sharan and a Seat Alhambra (really Sharan) and all the main parts are common can they go on being different prices once everyone has twigged they are the same?
.

You could always buy the Ford Galaxy......no wait, same car!

JAG X-type is a mondeo underneath, but it isnt really the same car is it? and the ASTON AM V8 Vantage has a hand assembled 4.3V8 which started life and a mass produced Jag V8 4.2. Mind you, the electronics in the ASTON are straight out of a Volvo, so is the door remote!

and the s-type jag is actually a Lincoln towncar! yak.

Ford and VW use the same company to produce its in car electronics, but this is a way of getting them cheaper.

GM have for years had differing companies under one roof. But Mercedes have a tie up with Mitsubishi and Hyundia for various things. The 1.8merc engine certainly doesn't start life in a merc build shop. You will find it in the 200kompressor series cars but its a mitsubishi engine.

Mind you, The new dodge calibre or whatever its called has a VW deisel engine. An Ford buy theirs off Peugeot!

The Nissan Murano uses a renault sourced V6! so is it a renault ie french? or a japanese car? nope, its a yank job!

Saab 9.3 are really just vectras in disguise and the 9.2 which you cant buy here is a Subaru impreza!

Bentleys don't appear to be suffering even tho the new Continetal GT and flying spur underneath are VW pheatons!

And not many have too much problem with Lambo's being audi's underneath, which i suppose you could say is a skoda!

the perception is that people will upmarket the car, not downgrade. nobody is going to think a mercedes is a chrysler, they will all think the chrysler is the mercedes! and really, thats what it is, the whole car started off life as one of the models or a few years back that is given a new lease of life in a differnet body. the New SLK will be superseeded around 2012 or so, it will no doubt arrive as the new improved Crossfire, just like the last one did.

And the Dodge Viper still has a truck engine!

Then again, As merc managed to knock up some dreadfully unrealiable stuff a few years back, maybes they are trying to destroy the chrylser empire from within!

Dont forget, DaimlerChrylser own Mercedes-Benz. Mercedes does not own Chrysler!

 

[SLinKyjoe]

. I suppose I can't bear the thought of my lovely 320cdi engine and gearbox being in a mass market car. Doesn't seem right. .

just out of interest.

the 320CDI is in the C class, the E class, the S class, and the ML's. I assume it will be in the GL's and R class and i am sure I saw a CLS with it!

Mercedes are Mass market cars!

And the 5sp Auto box found in the Stype and XJ/XK is a Merc unit!

Then again, Porsche make the Toerag for VW. and they also designed the folding roof for the SLK's and the latest SLK's and SL's! And 911 still have VW foot pedals!

 

[hawk20]

Dont forget, DaimlerChrylser own Mercedes-Benz. Mercedes does not own Chrysler!

I would put that somewhat differently. Daimler Chrysler is the new parent company/holding company set up by Daimler Benz (effectively Mercedes) after they bought Chrysler. In every normal sense of the words Mercedes owns Chrysler.

Or to quote directly from Wikipedia: -
Although Daimler-Benz is best known for its Mercedes-Benz automobile brand, during World War II it also created a notable series of aircraft, tank, and submarine engines.

In 1998 Daimler-Benz AG merged with the American automobile manufacturer, Chrysler Corporation, and formed DaimlerChrysler AG.

 

[SLinKyjoe]

I disagree, Daimler Benz Merged with Chrsyler to form DaimlerChrsyler. Mercedes Benz is a brand name that produces cars for Daimler Chrysler!

Whichever way you choose to look at it, Chrysler is the owner of the Mercedes Brand.

Thats why MercedesCustomer car is operated by Daimler Chrylser UK.

On the door panel of My Mercedes Benz it has DaimlerChyrsler on it!

this may help

http://www.daimlerchrysler.com/dccom/0-5-7145-1-62939-1-0-0-0-0-0-8-7145-0-0-0-0-0-0-0.html

 

[SLinKyjoe]

In 1998 Daimler-Benz AG merged with the American automobile manufacturer, Chrysler Corporation, and formed DaimlerChrysler AG.

thats what I am saying in the post i added while you were editing.

 

[DC_insider]

I disagree, Daimler Benz Merged with Chrsyler to form DaimlerChrsyler. Mercedes Benz is a brand name that produces cars for Daimler Chrysler!

This is correct.

The company is called DaimlerChrysler.

Mercedes-Benz, smart, Maybach, Chrysler, Jeep, Dodge etc are brands of DaimlerChrysler rather than companies owned by DaimlerChrysler.

 

[hawk20]

I disagree, Daimler Benz Merged with Chrsyler to form DaimlerChrsyler. Mercedes Benz is a brand name that produces cars for Daimler Chrysler!

Whichever way you choose to look at it, Chrysler is the owner of the Mercedes Brand.

Thats why MercedesCustomer car is operated by Daimler Chrylser UK.

On the door panel of My Mercedes Benz it has DaimlerChyrsler on it!

this may help

http://www.daimlerchrysler.com/dccom/0-5-7145-1-62939-1-0-0-0-0-0-8-7145-0-0-0-0-0-0-0.html

That is a most extraordinary re-writing of history and twisting of words. In common parlance Merc bought Chrysler. To the more semantic -and accurate- Daimler Benz (the Mercedes Group) bought the Chysler Corporation. Try these links for the full story: -
Taken for a Ride: How Daimler-Benz Drove Off With Chrysler, copyright 2000 by Bill Vlasic and Bradley A. Stertz. Published by William Morrow & Co., an imprint of HarperCollins Publishers.


http://www-e.uni-magdeburg.de/mfett/Taken for a Ride.html
This link gives a fascinating account of the ‘merger’ and summary of the book.
BOOK EXCERPT
Taken for a Ride

How the DaimlerChrysler ''marriage of equals'' crumbled
It was the deal heard 'round the world. In May, 1998, a stunning $36 billion merger was announced by Daimler Benz, the German manufacturer of Mercedes-Benz luxury cars, and Chrysler Corp., the all-American maker of minivans and Jeeps. The marriage of Daimler and Chrysler promised to rock the global auto industry and provide a blueprint for international consolidation on an epic scale.
But the union didn't turn out to be a merger made in heaven. When the dust settled, Daimler was firmly in control of Chrysler, and the shock waves were reverberating on both sides of the Atlantic. An American icon would lose its independence, and a German giant would grow in power and influence. Daimler chief Jurgen E. Schrempp grabbed the wheel of DaimlerChrysler (DCX). His co-chairman from Chrysler, Robert J. Eaton, took a back seat. And Thomas T. Stallkamp, Chrysler's president, got caught in between.

This excerpt is adapted from the book Taken for a Ride: How Daimler-Benz Drove Off With Chrysler, copyright 2000 by Bill Vlasic and Bradley A. Stertz. Published by William Morrow & Co., an imprint of HarperCollins Publishers. Reprinted by permission. Vlasic, a former BUSINESS WEEK correspondent who is now a reporter for the Detroit News, has covered Chrysler since 1994. Stertz covered the auto industry and is now an assistant managing editor for the Detroit News. The book is based on interviews with more than 200 people, including executives of Daimler Benz and Chrysler and other industry insiders.

 

[jberks]

On the original subject - even the great Toyota isn't impervious.
http://news.bbc.co.uk/1/hi/business/5285196.stm

 

[SLinKyjoe]

That is a most extraordinary re-writing of history and twisting of words. In common parlance Merc bought Chrysler. To the more semantic -and accurate- Daimler Benz (the Mercedes Group) bought the Chysler Corporation. .

Mercedes Benz has always been a brand of Daimler-Benz. ever since it was first created in 1927.

there is no rewriting of history. If you choose to think that Mercedes Owns Chrysler you are quite welcome to. But the fact remains that Chrysler was a car company in it own right and was Merged with DaimlerBenz to form DaimlerChrysler.

I suppose you will tell me next that Mercedes owns Airbus! Obviously the biggest sharholder of EADS (the company that owns 80% of airbus) is owned by DaimlerChrysler Aerospace.

Chrysler was $2bn in the red when it merged, and Daimler Benz took the debt on. Daimler Benz was subject to being taken over which is why it needed a partner, and rhe best partner was one that was massively in debt. Stops them being a good buy for some companies. This is the one reason why old Mercedes stuff gets shipped out to the US and clothed in tacky dresses. Its a cheap way of building cars without the expense of having to develop a new car.

However you choose to view it, those are the facts!

History:http://www.mbusa.com/heritage/brand-history.do
http://www.autozine.org/Manufacturer/USA.htm#Chrysler

 

[hawk20]

Mercedes Benz has always been a brand of Daimler-Benz. ever since it was first created in 1927.

there is no rewriting of history. If you choose to think that Mercedes Owns Chrysler you are quite welcome to. But the fact remains that Chrysler was a car company in it own right and was Merged with DaimlerBenz to form DaimlerChrysler.

I suppose you will tell me next that Mercedes owns Airbus! Obviously the biggest sharholder of EADS (the company that owns 80% of airbus) is owned by DaimlerChrysler Aerospace.

Chrysler was $2bn in the red when it merged, and Daimler Benz took the debt on. Daimler Benz was subject to being taken over which is why it needed a partner, and rhe best partner was one that was massively in debt. Stops them being a good buy for some companies. This is the one reason why old Mercedes stuff gets shipped out to the US and clothed in tacky dresses. Its a cheap way of building cars without the expense of having to develop a new car.

However you choose to view it, those are the facts!

History:http://www.mbusa.com/heritage/brand-history.do
http://www.autozine.org/Manufacturer/USA.htm#Chrysler

In posting number 13 of this thread you said:- "Whichever way you choose to look at it, Chrysler is the owner of the Mercedes Brand."

I am not sure if you have read the links you give but here is a direct quote from the second one:-
"In 1998, Chrysler merged with Daimler-Benz to become DaimlerChrysler. The merger was said as "equal merge", but in 2000 most American top executives were sacked and replaced with German. By then it was clear that the merger was actually a takeover by Mercedes."

 

[hawk20]

On the original subject - even the great Toyota isn't impervious.
http://news.bbc.co.uk/1/hi/business/5285196.stm

This is quite remarkable and perhaps shows that modern cars are really getting too complicated for their own good, if even the mighty Toyota has trouble getting them reliable. Interesting in JD Power this year that some Mercs are ahead of some Toyotas and ahead of many other Japanese cars. Toyota/Lexus announced recently that it would not increase sales of Lexus in the UK for the time being because it wasn't satisfied with dealer performance and wanted to get them all up to speed before expanding.