China Seen as Top Market for Mercedes-Benz

China will be the world’s biggest market for Mercedes-Benz vehicles by 2015, the company has announced. Consequently, Daimler AG pledged an additional $4.2 billion investment by 2015.

“We expect China to be our biggest market by around 2015,” said Dieter Zetsche, CEO of Daimler AG, Friday. “It could be earlier if the market demand continues its robust increase as local GDP grows.”

Zetsche said the investment is three times what the company has invested in China so far. The investment will be used to expand its product portfolio in the luxury sector and its dealership network. It will also be used toward local R&D as well as for social responsbility projects. The company aims to sell 300,000 cars annually in China by 2015.

Currently China is Daimler’s third biggest market after Germany and the United States. During the first nine months of 2010 it sold more than 101,350 Mercedes-Benz cars for an 129% increase over last year. The company has raised its sales target to over 120,000 units in China for 2010.

Daimler plans to increase local production of both passenger cars and commercial vehicles from the current 30% to 70% by 2015. It currently produces only the C-Class and E-Class sedans in its joint venture plant with Beijing Benz Automotive Co Ltd (BBAC). BBAC has recently tripled its capacity to between 75,000 and 100,000 units a year.

Daimler is also pursuing a 600-million-yuan joint venture with BYD to develop a new electric vehicle specifically for the Chinese market for 2013 release.

“We are still in the early stages of this partnership,” said Zetsche, “but exporting this vehicle in the future is also part of our considerations.”

Daimler also plans to increase its commercial vehicle production in China to keep up with booming demand.

BEIJING