Germans A-OK in the USA
Audi, BMW, Mercedes and VW hope market will help offset European woes
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DETROIT – German automakers expect to partially offset Europe's sales slump with another year of double-digit volume gains in the hot U.S. market.
"We expect to grow by about 10 percent this year," Mercedes-Benz USA CEO Steve Cannon told Automotive News Europe.
BMW North America CEO Ludwig Willisch also is bullish about his brand's future. "We expected another two-digit growth this year," Willisch told Automotive News Europe.
Combined 2012 U.S. sales at BMW Group, Daimler AG and Volkswagen Group rose 21 percent to nearly 1.25 million vehicles. Five of the automakers' brand set new U.S. sales records in 2012, and a number of those records are at risk of being topped this year.
Pent-up demand will drive overall U.S. light-vehicle sales to 16 million units this year, from 2012's 14.5 million, Morgan Stanley Managing Director Adam Jonas told the Automotive News World Congress last month.
If Jonas is correct, it would be the fourth consecutive year of growth for the U.S. market. Meanwhile, his company sees western European sales declining for a sixth straight year. The 2013 decrease is forecast to be 4 percent to 12.7 million light vehicles from 13.2 million in 2012.
The good news for German automakers is that consumers' appetite for their cars is growing faster than the overall U.S. market, which increased 13 percent in 2012. Last year, only Mercedes-Benz brand grew on par with the market average while Audi, BMW and Mini and VW brand did much better.
Daimler CEO Dieter Zetsche told reporters at the Detroit auto show last month that the United States and China would be bright spots for his company in 2013 compared with Europe. "When I hear bad news from the Old World, luckily I can call Steve Cannon to hear our U.S. sales figures," he said.
If Cannon's sales growth prediction is correct, the U.S. volume for the Mercedes and Smart brands could top 300,000 this year.
Super Bowl spot for CLA
Mercedes is counting on the CLA, a four-door coupe-styled compact that goes on sale in September, to attract younger buyers to the brand. Mercedes' average U.S. buyer is 51 years old, Cannon said.
Mercedes introduced the CLA to the U.S. market via a 60-second TV ad that debuted during the fourth quarter of the Super Bowl on Sunday. The Super Bowl spot is expected to reach more than 110 million people, said Bernie Glaser, Mercedes-Benz USA marketing boss.
Mercedes, BMW, Audi and others are going after the 75 million 30- to 40-year-olds who are forcing "the biggest changes the automotive industry will face," Glaser said.
"They have big expectations for products and brands." Those buyers cannot and will not pay the $40,000-plus sticker prices some of their status-conscious baby boomer parents can afford, industry researchers say. Yet they demand "attractive highly styled cars and the right technology," Glaser said.
BMW, which was the best-selling luxury brand in the U.S. in 2012 and 2011, sees growth coming from its new 3-series range and the face-lifted 7 series.
BMW's Mini brand aims to top its record U.S. sales in 2012 with help from new products such as the Paceman crossover. Mini also plan to add 10 to 15 dealers to a U.S. network of 150 stores.
VW Group also plans to stay on the growth path. Luxury unit Audi's U.S. dealer council expects sales this year to grow by another 20,000 units to about 160,000 sales, but the company cautioned that this prediction could be optimistic. Audi of America President Scott Keogh said that the company could reach its 2018 sales goal of 200,000 "sooner rather than later."
By that year, VW Group aims to sell a combined 1 million VW- and Audi-brand vehicles annually in the United States. "There are different routes by which you could get to our 2018 goal," said Jonathan Browning, CEO of Volkswagen Group of America, "but it's important that the VW brand is considered part of the mainstream business in the U.S."
Mark Rechtin, Gabe Nelson, Diana T. Kurylko and Reuters contributed
You can reach Luca Ciferri at lciferri@crain.com.
