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NI-13 invests millions

21st June 1986, Page 6
21st June 1986
Page 6
Page 6, 21st June 1986 — NI-13 invests millions
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Which of the following most accurately describes the problem?

• Mercedes-Benz (UK) and its dealers are spending over £14 million on new premises and strengthening the dealer network.

Work has already begun on a new training centre at the company's recently-opened Milton Keynes headquarters, and over .C9 million will be invested in a larger commercial vehicle distribution centre at Barnsley which will replace the existing premises in Wakefield.

Between now and the end of the year, over million will also be spent by a number of MB truck dealers on improving their individual franchised operations.

Following its record sales of 12,479 vans and trucks last year, the company wants to increase its 1986 sales to over 14,000 vehicles, helped by the soon-to-be-launched T2 Dusseldorf van replacement (CM, April 26).

According to managing director Hans Tauscher, MB(UK) is looking for steady, rather than rapid growth particularly as the above 3.5 tonne market for 1986 will be "slightly down on last year, by 3% to 4%."

Tauscher does not expect MB to retain its current second place position in the UK truck market above 3.5 tonnes GVW. Its impressive rise during the last six months is, says Tauscher, "a freak" caused by the recent discussions between GM and Leyland and Ford and lveco. "They have had a disturbing effect, and delayed buying decisions."

Tractive unit growth Mercedes intends to capitalise on the sales success of its LN2 range at 7.5 tonnes, but higher up the weight scale with new 11, 12 and 13 tonne models.

Tauscher would also like to see "more growth with tractive unit sales", which are down on last year following changes in some of MB's fleet business.

The current 55-strong truck dealer network is likely to increase, says Tauscher. "But gradually and in a manner where dealers are making reasonable profits. We don't want to add to the problem by having too many dealers, and too close. No new dealers will be appointed without a feasibility study."

As the company's market share increases, Tauscher says it will become economical to open dealerships in less densely populated areas like South-West England.

The UK market, according to Tauscher, "is still influenced by over-capacity. Wherever you look there is an enormous amount of stock which has not been sold."

Tauscher sees the heaviest discounting in the truck and artic sector, but he denies that MB is the aggressor. "We are certainly not here to buy market share through discounts. We are endeavouring to bring customers into the fold through other activities. We never intended to buy market share, everybody suspected we could do it, but we haven't."

As evidence of this Tauscher cites MB(UK)'s steady rather than meteoric rise in the market.

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Locations: Wakefield, Dusseldorf

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