Five-fold Mercedes-Benz, six-fold BMW, seven-fold Audi! The BBAs really can't take it

Car stuff

2024-06-19 16:34Posted in Beijing Automotive Creators

Car stuff

Author | Janson

Editor | Zhihao

If you don't work hard, you can only open a BBA! This joke is becoming a reality.

Che East and West reported on June 19 that recently, a number of models of Mercedes-Benz BMW and Audi, which represent the traditional "first-line luxury", began to reduce prices and promotions, and some of them were directly cut in half, a drop of 50%.

▲Comparison of the starting prices of some Mercedes-Benz, BMW, and Audi models with reduced prices

For example, Mercedes-Benz EQE dropped by 210,000, and EQB was directly discounted by 5%; BMW X3 directly reduced the price by 90,000 yuan, and i3 reduced the price by 140,000 yuan; The price of the Audi A4L was reduced by 110,000 yuan, and the price of the Q5 was reduced by 120,000 yuan...... It gives the impression that the price of the model on sale is not the lowest, only lower.

At present, the market of German luxury brands is constantly being squeezed by independent brands, and the transformation of new energy has been relatively slow, and the sales of many manufacturers, including BBA, in the Chinese market have declined.

Mercedes-Benz's financial report for the first quarter of 2024 shows that its sales in the Chinese market are 176,600 units, a year-on-year decrease of 12%. This performance not only affected Mercedes-Benz's market share in China, but also dragged down its global performance. In the first quarter of this year, Mercedes-Benz's global revenue was 35.873 billion euros (about 279.457 billion yuan), a year-on-year decrease of 4.4%, and its net profit was 3.025 billion euros (about 23.565 billion yuan), a year-on-year decline of 25%.

BMW and Audi are not much better, BMW's revenue of 36.614 billion euros (about 284.949 billion yuan) fell slightly by 0.6%, but with global sales of 594,500 units and 187,500 Chinese sales both won the BBA in the first quarter of the Chinese and foreign markets "sales crown", Audi's revenue of 13.725 billion euros (about 106.830 billion yuan) fell directly by 18.7%, a significant decline.

It can be said that this is also an important opportunity for first-line luxury brands to "cut prices".

To this end, Mercedes-Benz, BMW and Audi have also made quite a few price adjustments. Behind these price adjustments is also the sluggish sales of BBA and the determination to exchange prices for the market.

However, behind this, dealers also have their own small abacus, and while releasing low prices, there are also various "additional conditions" waiting for consumers.

First, the price of BBA dives and dealers have to be careful

▲Comparison of the starting prices of some Mercedes-Benz, BMW, and Audi models with reduced prices

In the BBA, Mercedes reacted the most violently. In response to market pressure, Mercedes-Benz has adopted a strategy of drastically cutting prices, and the prices of many models have been significantly reduced. Some fuel models have a discount of 6%.

Taking Mercedes-Benz C as an example, its official guide price starts at 333,200 yuan, but the quotation of some dealers is as low as 202,700 yuan, with a discount of more than 130,000 yuan.

In addition to the Mercedes-Benz C-class sedan, Mercedes-Benz's SUV product line has also seen a price "dive".

The official guide price of the Mercedes-Benz GLC is 427,800 to 531,300 yuan, but the dealer's quotation is 300,800 to 404,200 yuan, and the discount for some models is as high as 127,000 yuan.

The price reduction of new energy models is more significant, and the Mercedes-Benz EQE has pulled its starting price to the range of 25-300,000 yuan at a price drop of 210,000 yuan, and some dealers have reported 268,000 yuan. The 2024 EQB 260 is an example, with an official guide price of 352,000 yuan, while the dealer's naked car offer is only 176,000 yuan, a full five percent discount.

▲Mercedes-Benz EQE SUV

The guide price of the 2024 EQE SUV starts at 486,000 yuan, while the dealer quotation starts at only 306,000 yuan, which is 180,000 yuan cheaper.

At the same time, the situation of BMW is also very similar, the official guide price of BMW i3 is 353,900 yuan, but at present, a six-fold discount promotion has begun, and the price of dealers' naked cars has dropped directly to about 209,800 yuan.

▲BMW iX3

The iX3 has also been directly reduced by 130,000 yuan from the starting price of 405,000 yuan, and the price has been reduced by 275,000 yuan, a price reduction of up to 32%.

In addition, the new BMW i5, which was just released in January this year, dealers also provided a preferential offer of up to 60,000 yuan.

In addition to Mercedes-Benz and BMW, as a member of the BBA, Audi has also joined the ranks of price cuts. The only difference is that Audi's pure electric models have not dropped very much, and models like the Q5 e-tron are basically only 29,000 yuan, about 10% of the decline. On the contrary, fuel models, including A4L and Q5L, have decreased by about 30%.

▲Audi Q5L

According to the data, in May this year, the promotion of luxury cars reached a peak of 21.7%. Now, whether it is a first-tier or second-tier luxury brand, it has become the norm for the price of models to be significantly reduced.

However, it should be pointed out that these prices are all "solicitation stickers" published by dealers on various car selection and purchase portals, and there are some hidden mysteries in them.

The main engine factory gives the dealer a price, and the dealer calculates his profit margin and gives a relatively more attractive price, and then on the basis of this price, the customer needs to go through the mortgage procedures in the store, buy a boutique package, buy a "store warranty", replace the old car and use the license service in the store, etc., and these services also have a high premium, giving the dealer a "fracture price" to return blood.

▲ "Careful thinking" of some 4S stores

To sum up, it is not difficult to see that behind this price, the vast majority of dealers also have their own "careful thinking".

Second, the domestic auto market involution intensified First-line luxury cars are not easy to sell

According to the data of the China Passenger Car Association, from January to May 2024, Chinese brands will have a market share of 53%, 66.9% and 66.9% respectively in the sedan, SUV and MPV markets. Compared to the same period last year, the market share of all three models increased significantly.

From 2021 to 2023, the market share of Chinese auto brand passenger cars will reach 44.4%, 49.9% and 56% respectively.

At the same time, judging from the financial reports of the three BBAs in the first quarter of 2024, it can be said that the market for joint venture models is currently shrinking.

▲Mercedes-Benz, BMW, and Audi's performance in the first quarter

Mercedes-Benz's revenue in the first quarter of 2024 will be 35.873 billion euros (about 279.457 billion yuan), a year-on-year decrease of 4%; Net profit was 3.025 billion euros (about 23.565 billion yuan), down 25% year-on-year. In the Chinese market, Mercedes-Benz passenger car sales were 176,600 units, a year-on-year decrease of 10.4%; The sales volume of pure electric vehicles was 6,300 units.

BMW Group's revenue in the first quarter of 2024 will be 36.614 billion euros (about 284.949 billion yuan), a year-on-year decrease of 0.6%; Net profit was 2.79 billion euros (about 21.734 billion yuan), down 13.7% year-on-year. In the Chinese market, BMW's sales were 187,500 units, down 3.8% year-on-year.

The Audi Group's operating income in the first quarter was 13.725 billion euros (about 106.830 billion yuan), a year-on-year decrease of 18.7%; Operating profit was 466 million euros (about 3.630 billion yuan), down 74.3% year-on-year. In the Chinese market, the Audi brand sold 155,300 vehicles in the first quarter, a year-on-year increase of 14%; Among them, the sales volume of pure electric vehicles was 4,970, a year-on-year increase of about 54%.

Although BMW won the "sales crown" in the first quarter of the three BBA companies, all three companies also mentioned that there is currently a negative growth caused by the decline in sales. The revenue and profit of the three BBAs have declined to varying degrees, and Audi's profit has fallen by 74.4%.

In terms of sales, BMW's global sales increased slightly, but it is still negative growth in China, and Audi's sales in the Chinese market increased by 54%, but only sold less than 5,000 units.

Mercedes-Benz's performance is indeed very embarrassing, on the one hand, Mercedes-Benz is the first of the BBA three to start to promote the EQ pure electric brand, but at present, its pure electric vehicle sales are relatively sluggish, on the other hand, Mercedes-Benz in terms of revenue and sales, is also a car company with serious negative growth.

In the face of the financial report for the first quarter of 2024, the three car companies have adopted the strategy of price "diving" to save themselves by exchanging prices for the market. However, with the continuous increase in the market share of domestic brands, whether such behavior is effective still depends on the reaction of the market and consumers.

Conclusion: BBA began to exchange prices for the market

With the intensification of competition in the market and the rapid popularization of new energy vehicles, traditional German "first-line luxury" brands have adopted aggressive marketing strategies to cope with the challenge of declining sales.

Last year alone, Chinese auto brands sold 13.4 million new cars, surpassing the 11.9 million sold by American brands like Ford and Chevrolet.

In the future, it remains to be seen whether a "first-line luxury" brand like BBA can increase sales through price reduction strategies and regain a foothold in the fierce market competition.

But at the moment when BBA has begun to exchange prices for the market, consumers do have more choices.

After all, there are only unfriendly prices, and there are no bad new cars.

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