Germans Premium Brands To Continue Raking In Profits At the Expense Of Everyone Else

German premium auto manufacturers like BMW, Mercedes and Audi have been racing down the fast lane scooping up profits and sales the last five years as they rode China's unprecedented expansion and latched on to the recent U.S. market recovery.

Doubters warn that this success can't last. But this gravity-defiance is likely to continue although profits may return to less stratospheric levels. Experts doubt whether the German dominance of the premium car market will be threatened either. Their biggest threat might be self-inflicted, from, say, a hubris-driven takeover (like the Mercedes takeover of Chrysler, or out-of-control competition as they perhaps scramble irrationally for sales leadership and bragging rights at the expense of profits.

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USNA1999 - 4/25/2013 12:10:03 PM

+1 Boost

Wait, I thought Daimler profits plummetted 56% after its first quarter -forecast was revised. Maybe I misunderstood the article.

nguyenvuminh - 4/25/2013 12:24:03 PM

+4 Boost

I agree with the sentiment expressed in the article. The PERCEPTION about these 3 makes (MB, BMW and Porsche especially, Audi to a slightly less extent) is their most prized assets. Having said "perception", they are very disciplined in terms of their culture and belief about engineering excellence so they reinforce their perception very well. It's kind of funny but when these companies do stray from their core strength (more expensive cars) and try to do lesser expensive cars (for whatever reason, economies of scale, fuel economy compliance, new market, etc.), they tend to not fare too well (not yet with BMW, MB with their Smart cars, Porsche with their 924s and 914s). Likewise, the successful large volume mfrs like Toyota, Ford and Honda do really well in their lesser expensive car segments but they tend to fail when they try to grab the more expensive car segment (Lexus is strictly a N America success, forget Infinity and Acura, and Lincoln is on its death bed).

Rsport - 4/27/2013 10:32:41 AM

+1 Boost

You agree with the sentiments expressed in the article?
My question would be did you even read the article?
The article is about the worldwide sales juggernaut that are
BMW, Mercedes, and Audi particularly vis a vis the Chinese
economic expansion.

Not once did they mention Porsche.

Although you make some valid points regarding down market
Manufacturing affecting brand image your overall perspective
(particularly regarding Audi) seems to be skewed.

I'm betting your an American.

carsnyc - 4/25/2013 3:29:00 PM

+1 Boost

Nguyen, you could not have put it any better. Thumbs up!

thetruth01 - 4/25/2013 4:00:45 PM

+1 Boost

Germans are zee best, quoted the German, Herr Klink, in the article.