In the 1990s, things had been very rosy for Mercedes-Benz. Indians were getting richer, riding on the economic growth coming from a newly liberalised economy, and for over a decade the three-pointed star was, by far, the last word for those looking to announce that they have arrived in life. Mercedes practically had this market all to itself and, in hindsight, many have said that it had made them complacent.
But things started changing post 2007 when its traditional rivals from back home in Germany woke up to the Indian dream. In search of new money, BMW and Volkswagen group firm Audi realised almost simultaneously that they were missing out on something potentially big—the next growth market after China. Being a late entrant, BMW fought hard with competitive pricing and a very youthful positioning—Mercedes designs were viewed as boxy and dated—and managed to quickly emerge on top. Gathering volumes with new models like the X1 compact SUV, BMW retained its leadership for four years (2009 to 2012). Audi also increased its pace in the last year with the Q3, pushing Mercedes to the third spot.
Meanwhile, Mercedes upgraded its existing range with youthful designs, but chose to kept its best weapons in store. The men in Stuttgart waited till the competition had played out its best game, before calling for war. And war it is, the new B-Class launched last year takes the battle for luxury car supremacy to new lows in terms of price in a bid to gather volumes and reclaim the top spot.
The B-Class is the first five-door large hatchback in the segment, and a starting price of R21.49 lakh makes it the cheapest luxury car available in the country, while promising the snob value of the Mercedes brand. It is, in fact, cheaper than many sedan offerings from mass segment carmakers such as the Volkswagen Passat and Toyota Camry. In the next two years, Mercedes will completely unravel its ‘Next Gen Compact Cars’ portfolio with the smaller A-Class, GLA compact SUV and the CLA entry luxury sedan, promising an even lower entry price than ever before for the