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ReprintsMercedes cuts back on its Maybach stores
David Sedgwick
Automotive News
October 1, 2007 - 12:01 am ET
As sales of the Maybach uber-luxury sedan continue to lag, Mercedes-Benz USA has chopped the number of Maybach franchises by more than half. Twenty-nine of Maybach's original 71 U.S. dealers have given up their franchises, said Ernst Lieb, CEO of Mercedes-Benz USA. In turn, Mercedes has offered compensation to those dealers. When the brand was introduced about five years ago, Maybach dealers spent as much as $500,000 apiece to build studios for their customers. But U.S. sales never approached Mercedes' initial goal of 600 units a year. In 2006, Mercedes sold 146 Maybachs in the United States. Interviewed during the Frankfurt auto show, Lieb said he has negotiated compensation packages with the dealers case by case. He declined to divulge the amounts paid. But one suburban Detroit Mercedes dealer said he accepted an offer of 25 cents on the dollar. “It just was not a profitable franchise,” said Chuck Ghesquiere, owner of Mercedes-Benz of Bloomfield Hills. “It's a great product, but it had a big price.” Over the past five years, Ghesquiere sold seven Maybachs — not enough to justify the cost of the studio, the demo car and the inventory of parts. Ghesquiere hasn't decided what to do with his Maybach studio, but he is philosophical about his lost investment. “I'm a big boy,” he said. “I did it with my eyes open. I think they were fair.” Last week, Mercedes spokeswoman Donna Boland said the company doesn't plan any further deep cuts in Maybach franchises. She said: “This is just about where we want to be.”. |
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U.S. sales of the Maybach have never reached Mercedes' goal of 600 units a year. The Maybach 62 is shown. |
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