Mumbai: Eberhard Kern shows his tanned hands. The managing director and CEO of Mercedes Benz India attributes it to his hands being firmly around a golf iron, in pretty much the same way as he’s had a solid grip on the German luxury car maker’s operations in the country, for which he often tours sun-baked tier II and III towns.
With Kern’s hands-on approach, sales at the automaker have been on a fast trajectory. Ever since he occupied the corner office at the Chakan plant, he’s been traveling the length and breadth of India, opening dealerships to make the most of the untapped market potential among the mushrooming millionaires.
A broad phalanx of products – from compact luxury hatches with a new design language to high–performance AMG cars–have helped Mercedes become appealing to the Indian youth.
So, even as it opens up new markets in the interiors–like Calicut, Kanpur and Surat, amongst others–new product action continues. For the first time, Mercedes will be launching three new cars in a month. After launching the new B Class and A Class on Wednesday, the Stuttgart-based automaker plans to bring in the high-end E 400 Cabriolet and CLS 250 CDI.
Kern sees potential in the country’s luxury car market. Although it’s stagnant at 30,000 to 33,000 units, he’s happy with how the financial year will end for his company. “We have grown, but not all have. The outside environment is not in our control, but the best you can do is be prepared for a take-off and, therefore, we have almost doubled our capacity recenlty,” he said.
Reminiscing on the turnaround in the past two years, Kern said. “When I came here, we were under pressure, brand was struggling, but our strategy has nicely fallen in place, and thanks to the team effort. We have been the fastest growing luxury brand for two years and this year too, we will grow in double digits.”
Kern said there was scepticism when Mercedes launched the A Class and B Class in India, but the company has proved critics wrong. In the matter of two years, Mercedes Benz has sold over 3,000 units of new-generation compact cars (NGCs), A Class, B Class, CLA and GLA in India, and it already accounts for 20% of the company’s overall sales.
This year, the company expects NGCs to grow by 50%, which will help it maintain a strong double-digit growth and challenge Audi more fiercely for number the No 1 slot, which it had lost almost six years ago.
“The new gen compact cars are critical and we have helped a lot of people to join the luxury car club, but the other cars in our portfolio are also doing fairly strongly. The E Class is the largest selling car in our portfolio; the ML and GL Class still have a waiting. In the high-end cars category (Rs 70 lakh and above), we are by far the leader with over 50-70% share,” Kern said.
Under his leadership, Mercedes Benz grew by 50% in two years–crossing the 10,000 units mark–and has already regained the No 2 position in India it had lost to BMW. Its Ingolstadt-based rival Audi can already see Mercedes in its rear view mirror.
The year 2015 may well be a photo-finish, but Kern plays it down. “Three German rivals do fight fiercely across the world and it’s no different in India, it helps you get better. But we don’t look too much into others; our eyes are firmly on our strategy and we will grow,” Kern said
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2014 The Global Indian New Network (TGINN)