FRANKFURT - A year has passed since a Swedish auto writer flipped the Mercedes-Benz A-class during a 'moose test' maneuver. The incident damaged the image of Daimler-Benz - and almost killed its new baby model.
But the A-class appears to have survived the scare, thanks to a rescue plan put in place by Juergen Schrempp, DaimlerChrysler co-chairman.
Daimler at first retrofit the car with an electronic stabilizing program and replaced the tires. But Schrempp soon decided to take the radical step of suspending sales, which had started in October 1997, and re-engineering the car.
The strategy worked. Worldwide, only 4,000 customers cancelled their orders. The revised car was relaunched in February this year.
Twelve months later there are some reports of disappointing sales in Germany. But Dieter Zetsche, head of sales and marketing for Mercedes-Benz passenger cars, flatly denied that the model has under-performed.
'The A-class has fully met our expectations - in terms of sales, target customers and conquering a new market segment,' he said. 'Eighty-one percent of A-class buyers are new to Mercedes-Benz. Thirty-six percent are female, compared with an average 10 percent on other models. We are also attracting younger customers.'
While demand in urban areas has been strong, sales are reportedly slower in the countryside.
In Germany, some rural dealers overestimated the popularity of the car. They have been left with some unsold vehicles.
According to these dealers, they have started to add incentives to attract buyers.
DaimlerChrysler says it is a distribution problem, not one of oversupply. Dealer allocations have been revised, and cars are being redirected into areas with higher sales potential.
A-class sales will reach around 150,000 this year worldwide, according to DaimlerChrysler. At the end of October, they stood at 115,000.
Since the A-class relaunch in February, more than 67,000 units have been sold in Germany. This includes 6,000 rental cars. Sales in most other European countries began in March, apart from the UK which started receiving right-hand-drive deliveries in September. DaimlerChrysler has sold 10,000 A-class units in Italy, followed by 8,500 in France, 2,700 in Switzerland, 2,500 in Austria, and 2,200 in Spain.
But dealers have become frustrated by the lack of a full model range. A common-rail diesel, due last spring, has only just been launched.
Buyers wanting models with automatic transmissions, with 1.9-liter gasoline engines or AMG versions will have to wait until spring 1999.
'It's depressing that for months I couldn't offer diesel or automatic versions of the A-class for test drives,' said a major Mercedes-Benz dealer in the Frankfurt area. 'Now when customers place orders, I have to tell them that they will have to wait until next year for delivery.'
Some industry analysts expect a change in Mercedes-Benz brand strategy after the DaimlerChrysler merger, which could affect the A-class. Rolls-Royce and Bentley - under BMW and Volkswagen control - are expected to become tougher competitors. Mercedes-Benz will have to focus on its role as a premium car brand, rather than stretch into segments below the C-class.
Some analysts claim that neither the A-class nor the planned hatchback C-class fit into such a strategy. The A-class, they suggest, would be a perfect match for the Chrysler model range.
'I expect an internal decision within the next two years to build the A-class successor under the Chrysler label,' says Carsten Risch from Price Waterhouse Cooper Berlin. 'Then Mercedes-Benz still has three more years to launch a campaign to gently lead former A-class-customers into the Chrysler showrooms, by stressing the fact that it is all one big company.'
But Zetsche insists there will be an A-class successor and 'it will be a Mercedes-Benz.'
Meanwhile, the company is already working on a facelift for the A-class, due in 2000, aimed at raising interior quality.
Derivatives such as a small delivery van, a pickup and a four-seater with a removable roof panel are also being considered.
In December, a second A-class production facility in Juiz de Fora, Brazil, will begin operating.
It will produce 70,000 units a year to be sold exclusively in the Mercosur trading area, the economic union formed in South America by Argentina, Brazil, Paraguay and Uruguay. The car will go on sale there in May 1999.