In conversation: Peter Honegg, MD and CEO, Mercedes-Benz India

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A few weeks back we were at Mercedes-Benz’s Chakan plant, interacting with the German company’s top brass. We had the privilege of interacting with Mr. Peter Honegg, the man at the helm of MBIL. The affable gentleman engaged in a freewheeling interview with the bloggers during the two day event. Here are some excerpts from our conversation with him

What do you think are the biggest USPs of Mercedes against its competitors in a market like India?

I think we stand for unparalleled comfort, luxury, style and we are sporty too, where required. A sporty ride is good, but you cannot go overboard and spoil the comfort for the customers who really want it. We offer a great balance of both. Also, our cars hold their value really well in the used car market.

Mercedes has always been associated with luxury and a plush feel. What have been your steps to cement the brand’s image as a more youthful and sporty brand?

Well, we have some of the best handling cars out there. Our AMG line of cars is definitely some of the fastest and the sportiest cars anywhere in the world. If you drive yourself, you will love to drive our cars, but as I said earlier, the right balance is important for mainstream cars. Talking of sportiness and performance, we are very strongly associated with motorsport. We have a very strong F1 team, and we were the first auto manufacturer to associate with the F1 event when it arrived in India. We made a big statement about our commitment to performance with that association. Mercedes was also the first premium brand to be running an advanced driver training program for its customers at BIC. Doesn’t that say a lot? The SLS AMG, which was the centerpiece of our Auto Expo event, is the epitome of sportiness. We have also been taking a lot of initiatives to reach out to the youth and make them experience the performance side of Mercedes-Benz.

The B-class, where do you want to position it?

Well we cannot commit anything definitively but I think it will be priced in the sub 25 lakh bracket. It will be a sport tourer and would create a new market.

Do you expect it to sell in great volumes, just the way the BMW X1 did?

We do expect it to sell well, but you cannot expect a product to wipe the sales in a price bracket. There will be a variety of products in that segment and each one will have its own takers. People will choose what they like. It won’t be right to say that everyone would begin liking a new type of product overnight.

How do you plan to tackle the burgeoning competition in the luxury car space?

India is a huge market, and we will have to expand into Tier II and Tier III markets to ensure healthy growth. We are already the leaders in terms of the number of dealerships and we will be opening more dealerships as we move ahead. There is a whole bunch of exciting and promising products from Mercedes-Benz lined up for this market. We are sure these products will give our business a good push.

Can we expect Mercedes-Benz to regain the No.1 slot sometime soon?

It’s not just about the sales numbers or volumes. We don’t want to be selling many cars and not making good profits on them. We want to be no.1 in terms of the business we do and that is what really counts for us. In that sense, we think we are already No.1

What has been the reason for a relatively dull sales performance from Mercedes in the past few years?

I really don’t think that the performance has been bad. We have witnessed a very healthy growth, and we are the leaders in almost all the segments, except for the segments we are not present in. Our competitors have a few products in some segments we are not present, and that’s where the difference in consolidated numbers lies. The moment we have the products in those segments, and then some more, you will see the difference.

We have been hearing about the localization of the M-class; when is that going to happen?

Well, the local assembly of the M-class should start this year. The 2012 model of the car will go on sale next month in April, but the local assembly would still take about six months. We’ll also begin the local assembly of new G-class beginning next year.

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