Friday, March 14, 2008

Dieter Zetsche Confirms No New Maybach Products - Is the End Near?

By Chris Haak


Daimler AG CEO Dieter Zetsche told The Car Connection in an interview that he has not, as of now, approved any plans to replace Maybach's line of current models, which includes the 57, 62, and their special edition derivatives. The only recent news on the Maybach product front is the introduction of the ridiculous and tacky $1.35 million Maybach 62 Landaulet (which has a convertible top over the rear seat, and that Zetsche himself conceded is unlikely to move the needle in terms of sales for 2008). In 2007, Maybach sold 6.8% more units in the US than in 2006, but that was an increase of just 10 units, from 146 to 156. Since there are about 41 dealers in the US, it means that for their approximate $500,000 initial investment, each one is moving an average of just 3.8 cars per franchise per year. Since that's an average, it seems likely that some are selling just one or two, or even none.

To me, the Maybach is not even a very attractive vehicle. As I said in my last editorial about Maybach about six months ago, the Mercedes-Benz S63 AMG offers a more attractive package for less than half the price. On top of that, the Mercedes has more modern mechanicals (the Maybach models are based on the previous-generation S-class Mercedes-Benz cars).

Zetsche also told TCC that although Maybach will likely turn out to have had a "negative return on investment," it still has proven that Daimler can compete in the ultra-luxury arena with the likes of Rolls-Royce. I'd argue that when monthly sales in the US are scraping the edge of single digit territory, it's not really proving any kind of success.

The same way Zetsche dropped hints about the sale of Chrysler before announcing that "all options are on the table" last year, it seems likely that he didn't accidentally let the cat out of the bag about Maybach. I believe that he is intentionaly prepping the public for the dismantling of Maybach. Although the cars are extremely luxurious and expensive, they're selling at a fraction of their projected sales volumes. Daimler AG already has several potential flagship vehicles - the Mercedes-Benz S-class, SL-class, etc. - and does not need the diversion of resources for little return that Maybach has become.

No comments: