German automaker Daimler is best known around the world for its luxury Mercedes brand, but it is also the world market leader in commercial vehicles.
It is here that Mercedes has taken a new turn this week, unveiling a new mid-size van that is designed to make further inroads into a segment currently dominated by its chief German rival Volkswagen.
The new Mercedes Benz Vito will be Daimler’s second commercial van to be sold globally. It is aggressively priced, starting at just below €18,000 ($24,000), Daimler chief executive Dieter Zetsche announced Monday evening. That puts it about 5 percent below the price of Daimler’s existing line-up of midsize vans, the Sprinter, last re-launched in 2006.
The low price poses a direct challenge to the market leaders for mid-size vans – VW and Ford. It also offers Daimler another model in a market that is growing in the developed world and emerging economies alike.
Sales of light commercial vehicles – small to mid-size vans weighing up to 3.5 tons – climbed 7.3 percent in Germany and more than 10 percent in Europe over the first six months of this year. That compares to a passenger car market that has been stagnant in Germany over the past couple of years, rising just 2.4 percent in the first half of this year.
Meanwhile European demand for passenger cars has been devastated by the European debt crisis, and is only just beginning to recover.
Ferdinand Dudenhöffer of the Center for Automotive Research at the University of Duisburg-Essen said it is only a matter of time before Daimler succeeds in taking over from VW in the mid-size van segment. While VW is competing in this market on its own, he noted that Daimler has entered into an alliance with French carmaker Renault that is helping it gain know-how and keep down costs for non-luxury models.
Daimler said it will also market the Vito in North and South America, with production lines planned in the United States and Argentina.
The United States is the world’s largest market for vans and pick-up trucks – selling more than 15 million in 2013 – and Daimler is hoping for five-figure sales here with its new product.
The Vito could also offer opportunities in developing countries, where smaller commercial vehicles like vans are typically the first segment to be in demand, feeding into industrialization even before passenger car markets are established, Dudenhöffer noted.