Mercedes Benz Case Study

Abstract

Do you know what is world ranking of Mercedes-Benz in most famous brands? Do you know what is the situation of Mercedes-Benz in cars industry? Do you know the factors that affect the purchase decision of customers while buying cars?

Mercedes-Benz is a famous brand of luxury cars. These are German made cars and are known as status symbol of high class consumers. All customers have their own values and beliefs while purchasing a car. There are several factors responsible for the purchase decision. Car industry is growing very fast worldwide. There is a rapid change in trends and consumers preferences for comfortable, reliable, highly efficient and economical cars.

Mercedes-Benz company has to take care of consumers choice to maintain its position in the market and also for further growth in the car industry. The company is adapting new technologies and techniques to make its cars more famous among the customers. It is also introducing low priced luxury in the market. The company should take steps to know the exact consumer demand and needs so that it can provide them a suitable car.

Introduction & History

Mercedes - a Spanish girl's name meaning 'Grace'.

The Brand

Mercedes-Benz is a well known brand of luxury cars. These are German made cars with

classy European styling. Also it ranks as the world's second most famous brand (after

Coca Cola). Daimler-Motoren-Gesellschaft (DMG) delivered its first Mercedes on 22 December 1900. After that the company started a dynamic development culminating in the inception of the global company DaimlerChrysler AG in the late 20th century. Today Mercedes-Benz is the most successful premium brand. Its technical perfection, quality standards, innovative impact and numerous car legends such as the 300 SL Gullwing are unique .

The Founders

Gottlieb Daimler and Carl-Benz are the founders of the famous luxury cars -

Mercedes'-Benz. His first four-wheeler, the Victoria, was built in 1893. The first

production car was the 1894 Benz Velo which participated in the first recorded car

race, the Paris-Rouen race. In 1895, Benz built his first truck.

In 1990, Daimler had produced a special car for Emil Jellinek. Jellinek named the car

after his ten-year-old daughter Mercedes. The new Mercedes was lighter and smaller

with 35 hp and a top speed of 55 mph.

Growth of Company

Mercedes-Benz launched their biggest and most prestigious car to date in 1930. The 770

Grosser was powered by an 8 cylinder, 7.6 litre engine. A car for the truly wealthy of

the world, it was quite an automobile for showing off in a world economy still reeling

from the Wall Street Crash of 1929.The cars of the 1930s produced great racing success

for Mercedes-Benz.

Now Mercedes - Benz has many models in the market ranging from $ 34,995.00 to

$151,150.00. The main competitors of the company are BMW and INFINITY.

Products of Mercedes-Benz Company

1. Passenger cars: safety and comfort from A to S class.

2. MPV

3. Vans

4. Camper Vans : Viano MARCO POLO and Sprinter JAMES COOK

5. Trucks

6. Unimog

7. Buses: Medio, Sprinter Classic, Citaro, Citaro G etc.

Organizational Chart

Business Analysis

Business analysis of Mercedes-Benz involves the detailed review of factors such as consumer demand, competition, new product development, production costs, marketing costs and profitability for each proposed new product.

Consumer Demand: Now a days, consumers are very smart in selecting a car. They look for the best option available in the market. Their demands are highly efficient, affordable cost, reliable, comfortable and stylish models cars. Some consumers also consider that the cars should be environment friendly.

Competition: Mercedes-Benz is facing a very strong competition from Japanese cars and also from domestic cars. Japanese cars has taken a considerable market share of Mercedes cars. For example: In India, government was providing Mercedes cars to its VIPs and VVIPs but now the place of Mercedes cars has taken by Toyota Corolla cars as these cars are more efficient and mechanically more sound.

New Product Development: R&D department of Mercedes is inventing new cars and also doing modifications in the old models to increase its market share and to attract the customers. For example, the latest cars of Mercedes company are Bionic cars. In April 2004, Mercedes deliveries to customers a new super sports car Mercedes-Benz SLR .

Sales: The Mercedes Car Group sold 1,226,800 vehicles in 2004 (2003: 1,216,900). For model life-cycle reasons, unit sales of the Mercedes-Benz brand were 2% lower than in the prior year, however. smart's unit sales increased by 22% due to the launch of the smart forfour .

Production Costs and Profitability: The Mercedes Car Group is in trouble after a long slide in vehicle quality and profitability. Sales are slumping. Production costs are too high, especially in its native Germany. The Smart minicar line is bleeding money, and its Maybach super limousine is achieving half of targeted sales .

SWOT Analysis:

Strengths: