AMG, Maybach and G-Class will form a new division

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At last year’s shareholders’ general meeting, Mercedes announced that AMG, Maybach and G-Class have great growth potential. Now the luxury manufacturer from Stuttgart is taking an expected step and will concentrate all three sub-brands in a new business structure.

Mercedes’ new CEO, Ola Kalenius, has dramatically changed the brand’s strategy. Mercedes has given up unprofitable models (see X-Class and various coupe and convertible models) or sought partners to revitalize unprofitable sub-brands (see smart).

Instead, Ola Kallenius decided to focus on models with higher profit margins. Thus, Kallenius saw the huge potential of the AMG, Maybach and G-Class subbrands. From 2011 to 2015, AMG and G-Class sales increased by 3.5 and 2.5 times, respectively, and from 2015 to 2019, the figures doubled once again. Maybach sales also doubled from 2011 to 2019.
According to Automotive News, Mercedes plans to merge all three sub-brands into a single division and it looks like this will happen very soon. The announcement will be made at the Munich show in September.

The move will streamline marketing costs within the company and will strengthen the three subbrands, which are considered a source of rapid and profitable growth.

“Strengthening the subbrands is an important pillar in the Mercedes-Benz strategy,” a Daimler spokesperson told Automotive News Europe sister publication Automobilwoche. “We will not only maintain the independence, strong identities and evolved corporate cultures of the individual brands, but also further expand and sharpen them. Currently, we are in the process of designing it and evaluating the potential in the various areas,” the spokesperson added.

Mercedes consider that luxury is “where we belong, and luxury is where the growth is”. The marketing department of the German luxury manufacturer has found that the number of those who can afford to invest more than $ 250,000 annually will increase from 52 million in 2019 to 95 million in 2030. Part of the growth potential is also based on electrification. G-Class and Maybach will receive electric versions and AMG will use the know-how of the Formula 1 team to implement plug-in hybrid propulsion on its performance models.

It seems that the head of the new business structure created will be Philipp Schiemer, the current head of AMG.

AMG sold 114,000 units, Maybach has reached at 12,000 units  units and G-Class set up a record of 32,000 units in 2019.