Mercedes Benz A-class Limousine to draw in first time luxury car buyers

The Mercedes-Benz A-class Limousine is set to make its market debut in India on March 25, 2021. Essentially replacing the first-gen CLA, the A-class sedan will form the entry point to the luxury brand in the country. “In this segment, we have found there are two types of customers. One is our current luxury customers who want an additional car in the family. And then there is another set of customers who are upgrading into the luxury segment for the first time, and want to own the brand,” said Santosh Iyer, Vice President, Sales and Marketing, Mercedes-Benz India, in an interaction with Autocar India. “As India grows and new wealth comes in, we will find a lot of customers coming into the brand with this car,” he said.

• A-class sedan expected to be priced at Rs 40-42 lakh
• Mercedes providing 8 year powertrain warranty to lower ownership costs
• Company to offer a single, fully-loaded variant on the A-class

The case for bringing in the A class Limousine

Though it might be the baby Merc, the A-class sedan is expected to arrive with a price tag of Rs 40-42 lakh (ex-showroom), ceding some ground in terms of the price-to-size proposition, partly due to our punitive duty structure. Still, the company believes that it is an important product to have in the Indian line-up.

Commenting on the volumes of the entry-level luxury segment, Iyer mentioned that the erstwhile A-class hatch, B-class, CLA and the previous GLA raked in decent numbers. “We’ve seen this segment do close to 20,000 cars in the last four-five years. So that's not a small volume.” Along with the upcoming second-gen GLA, Mercedes expects the A-class Limo to keep adding to its numbers.

Moreover, first time luxury buyers bring in a lot of future potential. “On a strategic basis, we know that these customers will end up buying our GLE, GLS or even an E-class in the long run. So we want to get them to the brand with these cars, keep them in the family and even try to upsell higher-end cars as we move forward,” said the sales and marketing boss.

Notably, an attempt to give a better sense of space and comfort saw the German marque pick the standard sedan over the (new) CLA four-door coupe. “Our market research said that Indian customers want practicality, boot space and headroom. That's why, despite the CLA being a stylish car, we thought it may fall a bit short, considering the practical need of an Indian consumer. So, we took a call to get the A-class in the CKD format in India over the CLA,” said Iyer.

He also turned down any prospects of offering both the models concurrently. “It'll be at similar price points and not sharply positioned as such. So then you're crowding the market. So it's better for us to go after one model in the sedan portfolio. Having similar cars in same segment also affects long term residual value,” he said.

8 year powertrain warranty to help resale value

Mercedes hopes to make up for the high initial price of the entry-level sedan by lowering the cost of ownership. “We have a standard three-year warranty and for the A-class, as a first in the industry, we will also offer an eight year engine-transmission warranty,” mentioned Iyer.

He elaborated, “We see that a customer generally upgrades to the next Mercedes-Benz in four to five years. So when he sells this car, it’ll still be within warranty, and hence get an excellent residual value. So we are making it easier for the customer to step up to the next Mercedes-Benz. And this warranty is transferable, so even the new owner can enjoy it for the next three to four years.”

Fully kitted out trim to improve value equation

To deliver on the A-class’ premium positioning, Mercedes will be offering the sedan in a single, fully-loaded variant. “With the A-class, we don't want to go with a multi-variant strategy. We only have a fully-loaded version, one in petrol and one in diesel, that's it. We're not even going to offer an entry level variant because a guy coming to a luxury segment will not like to have some basics missing which a luxury car should have,” said Iyer.

Moreover, the brand has stuffed the car with features to enhance the value equation. “When you look at the size-to-value ratio from a rational perspective, sometimes there is a question mark. But the connectivity features and technology differentiate this car from any other,” he added.

The A-class will come loaded with powered front seats, dual-zone climate control, a sunroof, ambient lighting, a pair of 10.25-inch screens for the infotainment system and instrument cluster, AI-based voice assistant, wireless phone charging and connected car tech with Amazon Alexa integration. The senior Mercedes executive, then, believes that the whole package will come off as a “better value to the consumer entering the luxury segment. Otherwise, consumers would ask what is in it for them because some of the features may be available in a segment lower. But with the A-class, because of the connectivity and technology inside, the entire cabin is where the story lies in the car. You get a real luxury feel without any compromises.”

So, while the E-class and C-class sedans, along with the SUV line-up, are expected to continue being the company's bread and butter models, the A-class marks the return of Mercedes to a rather important segment that opens up the brand to a fresh audience with plenty of future potential.

Also see:

Santosh Iyer talks about the Mercedes-Benz A-class Limousine and more

Mercedes-Benz A-class Limousine review, test drive

Mercedes AMG A35 sedan India review, test drive

Mercedes-Benz A-class Limousine to launch on March 25