Red tape snags Mercedes E-class

CARMEL, Calif. — A certification slowdown means Mercedes-Benz dealers will have to wait longer than expected to sell the redesigned 2017 E-class sedan.

In May, Mercedes-Benz USA CEO Dietmar Exler said the 2017 E300 models would be on sale in June. But last week Exler told Automotive News that the vehicles are still awaiting regulatory approvals.

“We’re pushing and working very hard with the authorities to get certification. The cars are on U.S. soil,” Exler said at a press event here. “We hope we get certification quickly. The process is a little bit more difficult to predict than it was in the past. But feedback is good, and, hopefully, it will go fast.”

Exler hopes approvals will come within a couple of weeks. A Mercedes-Benz spokesman said the plan is to launch 2017 E-class sales by the end of July. Demonstration vehicles — owned by the manufacturer, not the dealer — are at dealerships, Exler said.

It’s unclear whether the certification holdup is with the EPA, the California Air Resources Board or both. Parent company Daimler AG is handling the certification process, not MBUSA. The U.S. spokesman declined to specify which agency has yet to certify the vehicle. Until the E class is certified, Mercedes-Benz is holding an undisclosed number of cars at its vehicle preparation centers in Brunswick, Ga.; Baltimore; and Long Beach, Calif.

Since the Volkswagen diesel emissions scandal broke last fall, regulators are taking longer in general to certify new models. In March, Daimler AG Chairman Dieter Zetsche said the scandal had caused a loss of credibility between regulators and the industry that was, in some cases, tripling the length of the certification process and causing delays in the launch of new models.

The wait comes on the brand’s biggest launch of the year in an all-important segment for Mercedes. With the 10th-generation E class, the company aims to increase sales and regain its leadership position in the segment, where sales have slumped as consumers increasingly turn from cars to trucks.

U.S. sales of the E class fell sharply — 25 percent — to 49,736 vehicles in 2015. Through the first five months of 2016, when the brand was selling down its inventories of the outgoing model, E-class sales dropped another 13 percent to 16,155 vehicles. The midsize luxury car segment in which the E class competes dropped 6.8 percent last year and is down another 13 percent through the first five months of 2016.

After its last redesign, in 2009, the E class was the segment leader from 2010 through 2012. It sold a record 69,803 vehicles in 2013 but was passed by the Lexus ES that year, which retains the segment title. The E class was second in the segment in 2015 but has slipped to third so far this year.

With the redesigned model, Mercedes expects E class sales to increase in 2016 and rise again in 2017, when more powertrain variants and additional body styles arrive. But Exler hesitates to predict a new sales record for the redesigned E class.

“The segment is down substantially,” Exler said. “We’re really happy with the car. We’ve got an attractive price position that we’re really happy with as well. And we’ll simply have to see with the segment. It’s kind of difficult to predict right now where sales will be going.”

The brand’s objective is to regain segment leadership, Exler said — but not at any price.

“We’re not going to have a discounted vehicle just to outsell somebody else,” he said. “I don’t think it makes sense to do a financially stupid thing to sell a car more than the competition. That doesn’t do anything for the company.”