Mercedes has a hard road to reclaim the top luxury spot from BMW if investor confidence is any indication.
“The market is saying that the prospects for Mercedes are much worse than for BMW”, said Hans-Peter Wodniok, an analyst for Germany-based Kronberg. “The market’s always right. In terms of innovation, BMW is the leader.”
Bloomberg’s latest report shows BMW’s market capitalization at €45 billion compares to Daimler at €42.2 billion. However, roughly €20 billion of that is accounted for by the automaker’s truck business. Subtract that and it leaves Mercedes-Benz with a value less than half of BMW’s.
Things were different only two years ago when Mercedes wasn’t just sitting above BMW, but was worth €15.5 billion more.
“The market’s confidence in Daimler management is pretty much at rock bottom”, Singapore-based Max Warburton, an analyst for Bernstein, told Bloomberg. “Investors have little or no confidence that current management will be able to do what is necessary to close the gap to BMW.”
Where BMW and Audi have been quick to jump into popular market segments like compact SUVs and clever about offering products younger buyers want, Mercedes is lagging behind in both areas. Slow growth in China is also a big part of what’s creating the gap between Mercedes and BMW.
“We have very clear strategies for all our divisions focused on both growth and efficiency”, said Florian Martens, a spokesman for Daimler.
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