Mercedes seeks cash boost with Maybach open-top

Bloomberg

Mercedes-Benz is rolling out a 300,000-euro ($323,000) limited-edition convertible under its
ultra high-end Maybach nameplate, as the German automaker seeks to burnish its luxury image and bankroll its investment in electric cars.
With a limited run of 300 vehicles, the Mercedes-Maybach S650 will be available next year and come with quilted leather seats, matching luggage and a device that projects its logo onto the curb, Mercedes parent Daimler AG said in a statement at the unveiling at the L.A. Auto Show on Tuesday. Maybach’s first cabrio takes aim at Rolls-Royce’s Dawn, which sold better than expected after coming to market last year, even though demand for cheaper convertibles is floundering.
“Daimler will be able to reap very high margins from this
car, because the development spending is low as it’s based on the existing S-Class cabrio,” said Christian Ludwig, a Bielefeld, Germany-based analyst with Bankh-
aus Lampe.
“Daimler has a very young product lineup, so that’s a cash cow they can turn to milking now.”
Mercedes is pursuing a two-pronged strategy of pushing expensive gas-guzzlers with higher profit margins in order to finance its development of electric vehicles and self-driving features, while also working to unseat BMW AG as the world’s best-selling luxury brand.
Amid surging sales, the new Maybach joins Daimler’s AMG GT sportscar — which is priced at 116,000 euros and competes with the likes of the Porsche 911 — in a high-end range that’s meant to underscore Mercedes’s exclusivity.
Daimler expects to spend 10 billion euros on electric vehicles until 2025, even as it continues to invest in combustion engines. BMW is pursuing a similar strategy of pushing larger, more expensive cars in order to pay for rising development costs.
CHEAPER CONVERTIBLES
Mercedes delivered 1.71 million vehicles in the year through October, a gain of 12 percent from a year earlier, putting the Stuttgart-based manufacturer on track to oust its rival BMW from the top of the ranking for the first time since 2005. The Dawn’s success came as sales of cheaper open-tops decline, with buyers increasingly opting for sport utility vehicles and Chinese customers shying away from bracing smog-filled cities in ragtop cars.
While a number of carmakers ceased making convertibles in an affordable price range — Volkswagen AG discontinued the Eos Coupe-Cabriolet last year — higher end iterations still have fans, prompting cars like the 51,400-euro Range Rover Evoque Cabriolet. Mercedes already sells an ultra high-end open-top under its AMG nameplate, priced at 255,000 euros.
The new Maybach, powered by a V12 engine, will feature headlights made with Swarovski crystals and “airscarf” neck heaters. Buyers will receive a certificate hand-signed by Chief Executive Officer Dieter Zetsche.