From rap lyrics to sitcom references, Mercedes-Benz is one of the world’s most talked about auto brands. It’s not just a reputation for luxury and sleek design that make these cars so desirable, it’s the combined personality and performance that draws so many consumers.
Mercedes (actually part of a parent company called Daimler) keeps itself open to new possibilities as they unfold. Their entire strategy hinges upon a desire to change the way people think about mobility, whether that means developing autonomous driving, electric cars, or something else that hasn’t even presented itself yet.
With a robust offering of cars, vans, and even busses, Mercedes proves that luxury doesn’t just come in the form of a two-door sports car (though that is always an option). Moreover, Mercedes exemplifies a growing trend for openness to progress in the auto industry with their demonstrated plans to produce a greater number of vehicles that stress efficiency.
Inventing The Automobile
When you think of the first car, Henry Ford’s Model-T may pop into your head, but this isn’t strictly accurate. In fact, Carl Benz (one of the Mercedes Benz founders) received a patent for the first “motorwagen” in 1886; it was a three-wheeled vehicle propelled by a motor. A primitive version of the way we see cars today, sure, but a version nonetheless. Thus, the automobile was born.
This spirit of innovation remained present in Mercedes throughout the 20th century. From vehicles offering battery-electric propulsion as far back as 1906, to 4-wheel independent suspension in 1931, Mercedes led the way in creating early versions of features now considered standard. The company as it is known today merged in 1926.
Safety and performance only increased from there, as Mercedes became stronger after World War II. The company expanded to the United States in 1957, and has been a favorite luxury vehicle in the U.S. ever since. Beautiful as they may be, cars made by Mercedes are more than just a pretty face—they have a long history of performance innovation.
The two biggest Mercedes competitors bear more than a few similarities to each other. Audi, BMW, and Mercedes are all giants in the luxury car industry, and they all feature German engineered performance in a sleek, sophisticated package.
Despite this, neither of these brands has been able to catch up to Mercedes’ sales, though BMW trailed closely in 2018. All the same, 2018 was the third year that Mercedes topped the list of luxury vehicles.
Of the three, Mercedes is the oldest company by more than 20 years, so perhaps it is the brand’s experience that helps recommend it. In any case, the rivalry between these companies is nothing new, and it’s not likely to end soon.
Toyota, the world’s largest auto manufacturer, outsells Mercedes by a longshot. However, Lexus (Toyota’s luxury brand) is only one part of their offering whereas Mercedes exclusively sells luxury cars. Because of this, it’s difficult to draw a clear comparison between the two.
Selling A Lifestyle
As a luxury brand, Mercedes tows a tough line. They have to appear elevated, yet attainable so as not to put off customers who fall below a certain income tax bracket. To this end Mercedes has enlisted the help of many celebrities, often from varying backgrounds, listing them as brand ambassadors for a lifestyle rather than for their vehicles.
One spokesperson for the brand (a favorite among many luxury brands) is tennis player Roger Federer. Federer is almost as famous for his wry personality as for his skills on the court, and Mercedes loves to make a statement.
A different sort of brand ambassador, DJ Felix Jaehn appeals to younger crowds. This is important, as Mercedes wants to cultivate a group of people to aspire to own their cars, so they’ll make that purchase once they have the disposable income.
Diesel has long been a point of contention for German automakers. Volkswagen was found to have manipulated emissions scores, and BMW and Mercedes joined in on this scandal when they were all found to have delayed emissions cleaning systems.
Because of this, the government alleges that these three companies violated antitrust laws, and the issue will have to be investigated further to provide conclusive answers. Understandably, the ordeal has called into question not only the ethics of Mercedes as a company, but also the reliability of their current financial standing.
Mercedes says it is complying with the investigation into this matter, and doesn’t expect to be fined, but slashed its earning projections all the same. Issues like these may soon be a thing of the past, as Mercedes (and many other companies) release more plans for electric vehicles.
Perched at The Pinnacle—For Now
While the fallout of the most recent diesel scandal as it relates to Mercedes remains to be seen, the company currently sits high on the Forbes list of the World’s Most Valuable Brands, at number 17. This is higher than any other luxury auto brand, aside from Toyota (who produces Lexus), but the two cater to different demographics.
However, the Forbes list also shows that Mercedes’ brand value is down 3% from the previous year, for a current value of $33.2 billion. Likewise, Fortune shows a 3.8% drop in revenue for Mercedes, but increased their rank on the Fortune 500 for 2019 all the same.
Now sitting at number 16, perhaps Fortune recognizes that Mercedes is leaning into the demand for autonomous and electric cars, throwing production energy behind such pursuits. In any case, neither of these lists could have predicted that Mercedes would slash its earning expectations, which could wind up reducing the brand ranking.
An iconic brand in the world of luxury, Mercedes remains near the top of the pack for the moment, but it remains to be seen how the company will fare in these turbulent times of progress.