Amid Losses, Daimler Rethinks North American-made Sedans
Domestic automakers have largely rid their North American facilities of sedans, so why shouldn’t foreign manufacturers? That’s what Mercedes-Benz parent Daimler plans to do after announcing a second-quarter loss of $1.9 billion.
While the quarterly loss was less than analysts expected, financial and sales pressures brought on by the coronavirus pandemic has led the automaker to cull car production on this side of the pond.
“Our systematic efforts to lower the breakeven of the company by reducing costs and adjusting capacity will need to continue,” CEO Ola Kaellenius said, per Reuters.
In terms of production, that means a number of things. The company has already decided to ditch a French assembly plant that once cranked out Smart models for North American consumers, but can now be replaced by a Chinese facility (after Geely’s purchase of a 50-percent stake in the brand). In North America, the plan is to get the Mercedes-Benz C-Class out of Alabama.
The automaker’s best-selling car in the U.S., the C-Class entered production in Vance, Alabama in 2014, though it was rumored last year that future generations of the model would hail from elsewhere. The plant focuses mainly on the GLS and GLE utility vehicles, and that’s where M-B sees future growth.
South of the border, the company’s plant in Aguascalientes, Mexico (that’s the joint Renault-Nissan one) will cease production of “a variant” of the A-Class, Reuters reports, turning its attention to the new Mercedes-Benz GLB small crossover. The A-Class sedan entered production at the plant in September 2018.[Image: Daimler]