DaimlerChrysler United Kingdom’s decision this week to hike prices an average two percent on its Mercedes-Benz range will combine with ‘growing signs of restricted supplies’ and ‘suffocate’ dealers’ ability to sell to willing customers, says the price monitoring website carpricecheck.com.
An analysis of transaction prices between the UK and Europe for the entire new car market (over 3,000 models) shows that the D-C UK decision goes against a continued downward trend in prices, carpricecheck.com said in a statement.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
“Today, the majority of UK franchised dealers are winning back customers and appear to be able to reduce the [unofficial] importer advantage to a negative or negligible figure,” the statement said.
“As a regular in the top five most sought-after marques for the [internet] car buyer, an in-depth study of seven million transaction price records collated over the past nine months shows that Daimler-Chrysler UK’s decision to reduce its Mercedes-Benz list prices last August significantly aided a marked recovery in favour of the consumer and the dealer.”
Carpricecheck.com now claims that the situation has reversed.
“Of the 12 derivatives from the Mercedes-Benz range, where UK dealers were able to offer a positive price advantage over importers, restrictions on supply voided any accruable benefit to the consumer,” the website operator said.
“Such a scenario comes against a backdrop of increased consumer confidence in buying from UK dealers.”
Steve Evans, CEO of carpricecheck.com’s parent company Autohit plc said that, although it might be co-incidental, the availability of new Mercedes-Benz models in the UK appeared to have been scaled back and discounts reduced, thwarting the sales efforts of dealers and, in effect, making the wait for an unofficially imported, European sourced vehicle again a more attractive option for private buyers.
“The price differential for Mercedes Benz models, which was beginning to be eroded by the headline price reductions, is now back with a vengeance further damaging the efforts of the dealer to supply UK consumers with non-import vehicles,” Evans added.
Carpricecheck.com analysed transaction prices in March, identifying trends for each Mercedes Benz model.
In cases where independent importers were quoting against UK dealers, there was a pre-price increase advantage of around £500 ($US720) for buyers who bought an A-class in Europe.
For the C-class, including the CLK coupe/cabriolet, before the April price increases, there was a European import advantage to consumers of between £600 and £4,000. UK model availability is extremely poor, carpricecheck.com said.
While the E200 and E240 attracted lower transaction prices in the UK, the rest of the E Class range was between £200 and £1,000 cheaper in Europe.
Again, carpricecheck.com claimed that UK model availability relative to internet buyer demand was extremely poor.
S Class models were between £1,500 and £4,000 cheaper if sourced in Europe than in the UK while SLK roadster models were between £1,200 and £2,800 cheaper when sourced in Europe.
Mercedes-Benz UK’s price increase also came under fire on Thursday night from BBC Television’s consumer programme Watchdog. The programme claimed that buyers with cars on order had been told they would have to pay increases averaging £500 over previously quoted prices before taking delivery.
A Mercedes-Benz UK spokesman said : “The 1.73 per-cent average price increase on models in the UK is due to inflationary price increases in Germany [where] prices were increased in February. It still means that, when adjusted to UK specification, prices in Britain reflect those in Europe.
“Customers tempted to buy abroad should carefully look at the specification,” he added.
“Mercedes-Benz models bought through franchised dealerships in the UK have a three-year unlimited mileage warranty, the ex-factory warranty is 12-months. UK-bought Mercedes also have an upgraded alarm system as standard which is not fitted on cars bought in Europe.
The spokesman said that Mercedes had just recorded a record first quarter in the UK.
“In the first 10 weeks of this year we sold more cars than in any year of our first 10 years of operations in Britain. That must reflect that customers are pleased with the product and the price in the UK.”
To view related research reports, please follow the links below:- Automotive retailing in the new millennium Automotive b2b – Strategic threats and opportunities in the automotive supply chain |
