What and who are the German auto manufacturers?
We all know exactly what Mercedes-Benz, BMW, Volkswagen and Porsche are in the minds of customers, shareholders and employees. Well, we're all wrong.
These quiet, mild companies are engaged in a battle for the hearts and minds of customers all over the world.
Maybe it started with BMW. Suddenly, in 1994, BMW became the owner of Rover, a totally different sort of company that just about doubled BMW's size and gave it a range of products outside BMW's image. From the Mini to the Range Rover to even some BMWs, BMW reinvented itself.
But Mercedes wasn't standing around gawking. Mercedes developed new models, new niches and new plants outside Germany. From more German Mercedes models to the Smart car plant in France and the M-class plant in Alabama, parent Daimler-Benz has doubled its volume. Now with Chrysler Corp., Daimler has become a world player in categories that no one would have guessed five years ago. Daimler-Benz is about to become a different company, in markets that no one expected. And the name is DaimlerChrysler.
Meanwhile, VW was staking out new brands and new positions as well. With brands from Audi to Seat to Skoda, was it any surprise that VW thinks Rolls-Royce will fit quite well under the VW umbrella? The competition is getting tougher.
And even Porsche cannot escape the temptation to broaden its traditional product line. When Porsche announced the joint venture with VW for a very upscale sport-utility, the Porsche executives were testing the limits of the Porsche brand. And why not? Everyone in Germany wants to broaden the product line.
For decades we all understood exactly what those famous German automobile brands stood for. Their position in our minds was clear.
But today, these same manufacturers are making their brands as broad as possible, and trying to take market share from each other. Where there were no real German luxury sport-utilities just a couple of years ago, tomorrow there will be four, including two built in North America.
Whatever you knew about their vehicles and their positions no longer applies.
Who will be the winners and losers? It's anybody's guess. They are the best, and playing for huge stakes.