SME fleets that have Mercedes-Benz models on their fleets will want to review their TCO (Total Cost of Ownership) models as the company says it plans to be a luxury car maker.
As part of that brand upshift, Mercedes will start dropping more attainable models in its range, while making model scarcity part of its brand strategy.
Speaking at the Association of Fleet Professionals’ first conference, Head of Fleet Sales, Tom Brennan, said that Mercedes was “changing lanes”.
Explaining what he meant by this, Tom said:
“Our ambition is no longer volume. That change will become clear in 2023 when we move to the agency model.
The agency model Mercedes is proposing allows the manufacturer to talk directly to customers with car retailers becoming handling agents. It is designed to bring price transparency – “the expectation of a luxury brand”, added Tom.
Along with the luxury pivot, Tom said that there would be product simplification and fewer trims – in other words, vehicles that were once part of SME fleet choice lists will no longer be available.
At a separate investors event held in France, Mercedes-Benz officials unveiled further elements of the strategy.
In future, there will be three Mercedes-Benz product categories:
- Top-End Luxury,
- Core Luxury and
- Entry Luxury.
In the Top-End Luxury segment the product portfolio encompasses:
- Mercedes-AMG and Mercedes-Maybach brands
- Top-End models from Mercedes-EQ, including the EQS and the EQS SUV
- Mercedes-Benz S-Class and G-Class models as well as the full-size luxury GLS
Core Luxury will be central to fleets where the company says it will electrify on an “accelerated timescale”. These include the Mercedes-Benz C-Class and E-Class model ranges. The new E-Class comes to market next year and will provide us with a better idea of where Mercedes is pitching itself to fleets.
The new entrance point of the Mercedes-Benz portfolio is being redefined with the next generation of vehicles. In the Entry Luxury segment, Mercedes-Benz will reduce the number of model variants from seven to four while significantly while adding greater levels of technology.
Finishing off, Tom Brennan was clear that fleets remained central to the company, saying:
The only way we are going to achieve all of this is with fleet customers. You are the most important customer group for us.
That might be the case – but at what cost to SME fleets?
Main picture shows the new Mercedes-Benz EQE saloon.