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At Jeremiah's request...

Old 06-20-2007, 09:01 PM
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Default At Jeremiah's request...

... this story about Dr. Z was moved from the Challenger in the Press section. It's from USA Today, 6-20-07:

Mercedes' new insight was born in the USA

By Sharon Silke Carty, USA TODAY
DETROIT — Much like a recent divorcé, Mercedes-Benz is about to face single life for the first time in nine years, and industry watchers say the German luxury brand is better poised to woo U.S. buyers than ever before.
Sure, it faces challenges in the USA as consumers delay purchases while waiting out falling housing prices. Higher gas prices, unfavorable foreign exchange rates and rising interest rates also could be stumbling blocks for the automaker.

Yet Mercedes appears to have taken one key thing from its marriage to Detroit's Chrysler: insight into the American consumer.

Last month, DaimlerChrysler announced it was selling 80.1% of its stake in Chrysler to private equity firm Cerberus. That leaves DaimlerChrysler — which plans to start calling itself just Daimler in a few months — with three brands: Mercedes, Smart and its commercial trucks division.

During the marriage, the German executives running DaimlerChrysler fought to keep Mercedes and Chrysler separate to preserve Mercedes' luxury image. But some Chrysler know-how seeped through.

Daimler CEO Dieter Zetsche spent five years living and working in the USA, learning American tastes and seeing how business is done here while heading Chrysler. He is a fan of America and Americans. In fact, two of his children stayed behind and are attending U.S. universities, so the connections remain.

From the standpoint of the Mercedes consumer in the USA, owning Chrysler has been an asset to Daimler, says Stefano Aversa, co-president of AlixPartners, a turnaround firm.

That's because there are so many differences between German and American car buyers: Germans are used to ordering their cars and sometimes waiting weeks for them to arrive, while Americans want to buy cars off the lot. Germans love technology and don't mind wading through gigantic manuals to figure out their cars. Americans want things easier. Americans love a car with powerful torque — that oomph you get when you step on the gas — while Germans care more about road handling. And those cup holders. We love them; Germans don't know why we'd want to do anything in our cars but drive.

"These are the lessons Zetsche learned, and he will be able to use that now that he's at the top of Mercedes," Aversa says.

It might be overstating it to say that Mercedes struggled to understand the American consumer in the past. Rather, the automaker seemed indifferent to American tastes before, says Skipper Beck, a Mercedes dealer in Charlotte.

Beck, former head of the Mercedes U.S. dealer board, says that on trips to Daimler headquarters in Stuttgart, he got the feeling the German company wasn't really interested in U.S. dealers' perspectives.

But that's changed, he says. "They definitely have opened their eyes up to this being their most major market. They pay attention to what's said here now."

In an interview, Zetsche said the company is listening to American consumers and may even tweak cars headed here to satisfy American tastes.

The biggest complaints about Mercedes in the USA have been about difficult-to-use technology in the cars, he says.

"We are, of course, listening and learning, making it not more complicated but easier to use. It's certainly a legitimate request from our customers. … In this regard, I think we can further learn from the American customer, and the improvements we can make for better access will be beneficial for our customers around the world."

Mercedes will need all the advantages it can get in the U.S. market. Luxury car sales are down 5.8% through the end of May, and incentives are skyrocketing in the segment, which is usually sheltered from the pressure to offer steep rebates. In May, incentives on luxury cars were $3,832, the second-highe
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