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Mercedes-Benz: SUV demand forces A-Class Sedan production move

"Hecho en Mexico", no más! Mercedes-Benz is moving A-Class Sedan to Germany as its new GLB promises to be a hotter seller.

4 months ago
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William Stopford
Journalist

In another sign sedans just aren’t as hot as SUVs, Mercedes-Benz is moving A-Class Sedan production to make room for the new GLB.

Automotive News reports production of the A-Class Sedan at Mercedes-Benz’s Aguascalientes factory in Mexico will end after just two years, despite a significant investment in tooling.

UPDATE, 20/07/20 2:55pmAn earlier version of this story incorrectly stated the Australian-market A-Class sedan is built in Mexico when it’s already sourced from Germany.

In a communication to suppliers obtained by Automotive News, Mercedes-Benz said it was moving A-Class production to focus on the GLB and cited market developments as a result of the pandemic.

Disappointing sales in the US market may be to blame – small luxury sedan market share has fallen 40 per cent there since 2015.

Production of the sedan will continue at the company’s Rastatt factory in Germany, which currently supplies the Australian market. Rastatt is also one of three European factories that produce the A-Class hatchback, the others being in Finland and Hungary. The latter is where we source our A-Class hatches from.

Daimler opened the Aguascalientes (“hot waters”) plant in a joint-venture with Nissan in 2017. It’s significantly under-utilised, last year manufacturing just 90,408 vehicles when it has the capacity to build more than 230,000.

Disappointing sales for the Infiniti QX50 and delays for its QX55 coupe SUV sibling play a large part in that. An unspecified small luxury car, which was to be co-developed by Daimler and Infiniti and built there, was also scrapped.

Mercedes-Benz: SUV demand forces A-Class Sedan production move

Around 96,000 GLBs were expected to roll out of the Mexican plant this year until the Coronavirus crisis weakened demand and closed dealerships. That’s more than twice as many units than Mercedes produced of the A-Class Sedan there last year.

This is the first generation of A-Class to offer a sedan, which means Mercedes now has two four-doors in its A family of cars.

The CLA, marketed as a coupe, commands a healthy premium over the three-box A-Class – the cheapest A-Class sedan, the A180, costs $46,200 before on-road costs while the CLA range opens with the CLA200 at $60,700 before on-road costs.

Even comparing models with identical powertrains, there’s a significant gulf. An all-wheel drive A250 sedan costs $59,200 before on-road costs while an all-wheel drive CLA250 costs $70,200 before on-roads.

Mercedes’ sedan styling is getting increasingly swoopy and curvaceous, which puts the A-Class sedan on a collision course with the CLA.

You need only look at the updated E-Class and its coupe-like tail lights to see how the next CLA will have to be even more adventurous visually than the current model to distinguish itself from the cheaper A-Class.

Mercedes-Benz: SUV demand forces A-Class Sedan production move

Whether because it’s a new generation or because there’s now a sedan variant, A-Class sales are up 25.9 per cent year-to-date.

Mercedes doesn’t split out sales of the hatch and sedan variants, so it’s unclear how many of the 3342 A-Classes sold so far this year are of the booted variety.

Mercedes has also sold 844 of the related CLA, its sales up by 39.7 per cent. Rival BMW has sold 1356 1 Series hatchbacks and 671 of the new 2 Series Gran Coupe, while Audi has sold only 1090 of its soon-to-be replaced A3.

Mercedes-Benz: SUV demand forces A-Class Sedan production move

The story is a little different in the small luxury SUV market, where the Audi Q3 and BMW X1 are outselling the Mercedes-Benz GLA.

Expect the redesigned GLA, arriving soon, to claw back some ground. The new GLB is already off to a strong start, too – with 213 sales in its first month on the market, it outsold other small SUVs like the Audi Q2 and BMW X2.


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