He’s the man who has been steering the Indian arm of Mercedes-Benz for the past five years. In an Exclusive with B&E, Dr. Wilfried Aulbur, CEO & MD, Mercedes-Benz shares where the company is heading
They entered India in 1994. After some restructuring globally and getting accustomed to the Indian landscape, we today know them as Mercedes-Benz India. It wasn’t a smooth ride, but today the luxury automobile giant rules the roost.
B&E: Mercedes-Benz has been in India for over a decade and a half now. What challenges have you faced since you stepped in as its CEO in 2006 and how has been the journey so far?
Dr. Wilfried Aulbur (WA): In these five years we have faced several challenges. The first one would definitely be the transition from operating in a monopolistic environment to the one filled with intense competition where we not only have the German players, but also the Jaguars and others. Further, we are operating in a market that is growing dramatically, which is an opportunity we need to leverage upon. In fact, we will end up selling 5,000 units more this year. Our CAGR over the past five years roughly boils down to about 30% and things have turned up pretty well for us so far. Another major challenge is to streamline factory operations with sale and after sales services. Then comes the challenge of preparing available human resources in the entire value chain for the upcoming explosion in demand. Apart from these unique challenges, there were those which any company operating in an economy booming with opportunities would face. These included construction of a new facility, ramping up production, expanding R&D activities, so on and so forth.
B&E: How different is it to cater to the luxury segment in India as compared to Germany?
WA: The difference is the segment itself. The market in India is relatively nascent. As the market grows, we too will continue to grow rapidly and see about 40,000-50,000 Mercedes-Benz cars being sold in India in the next 10 years. In India, we have the privilege of interacting with an elite group of people who form our customer base, but in Germany the customer base is much more broader. In Germany we have a market share of 8%-10%. That means, every tenth new car being sold in the luxury segment is a Mercedes-Benz and we are the clear leader in that market space.
B&E: What is the logic behind “Proven Exclusivity” programme?
WA: “Proven Exclusivity” is a globally benchmarked pre-owned car programme. This programme utilises specific global benchmarks for vehicle evaluation, quality and warranty to offer Mercedes-Benz certified pre-owned cars to customers. In fact, it’s a very good opportunity for people who wanted to be a part of the Mercedes family, but couldn’t join it because of some sort of financial limitations. This is for the people who want the comfort, quality and safety of a Mercedes-Benz but do not really want to spend as much money. In fact, we aim to garner 15-20% of our overall sales volume through “Proven Exclusivity” programme in the near future.
B&E: But, will a prospective Mercedes buyer go for a second hand car? Luxury was never about anything ‘used’.
WA: You see, the basic product promise remains exactly the same. You get the same safety, same quality, same comfort and the benchmark performance that is the hallmark of a Mercedes-Benz. The only difference is that we are able to serve a more broader customer base.
They entered India in 1994. After some restructuring globally and getting accustomed to the Indian landscape, we today know them as Mercedes-Benz India. It wasn’t a smooth ride, but today the luxury automobile giant rules the roost.
B&E: Mercedes-Benz has been in India for over a decade and a half now. What challenges have you faced since you stepped in as its CEO in 2006 and how has been the journey so far?
Dr. Wilfried Aulbur (WA): In these five years we have faced several challenges. The first one would definitely be the transition from operating in a monopolistic environment to the one filled with intense competition where we not only have the German players, but also the Jaguars and others. Further, we are operating in a market that is growing dramatically, which is an opportunity we need to leverage upon. In fact, we will end up selling 5,000 units more this year. Our CAGR over the past five years roughly boils down to about 30% and things have turned up pretty well for us so far. Another major challenge is to streamline factory operations with sale and after sales services. Then comes the challenge of preparing available human resources in the entire value chain for the upcoming explosion in demand. Apart from these unique challenges, there were those which any company operating in an economy booming with opportunities would face. These included construction of a new facility, ramping up production, expanding R&D activities, so on and so forth.
B&E: How different is it to cater to the luxury segment in India as compared to Germany?
WA: The difference is the segment itself. The market in India is relatively nascent. As the market grows, we too will continue to grow rapidly and see about 40,000-50,000 Mercedes-Benz cars being sold in India in the next 10 years. In India, we have the privilege of interacting with an elite group of people who form our customer base, but in Germany the customer base is much more broader. In Germany we have a market share of 8%-10%. That means, every tenth new car being sold in the luxury segment is a Mercedes-Benz and we are the clear leader in that market space.
B&E: What is the logic behind “Proven Exclusivity” programme?
WA: “Proven Exclusivity” is a globally benchmarked pre-owned car programme. This programme utilises specific global benchmarks for vehicle evaluation, quality and warranty to offer Mercedes-Benz certified pre-owned cars to customers. In fact, it’s a very good opportunity for people who wanted to be a part of the Mercedes family, but couldn’t join it because of some sort of financial limitations. This is for the people who want the comfort, quality and safety of a Mercedes-Benz but do not really want to spend as much money. In fact, we aim to garner 15-20% of our overall sales volume through “Proven Exclusivity” programme in the near future.
B&E: But, will a prospective Mercedes buyer go for a second hand car? Luxury was never about anything ‘used’.
WA: You see, the basic product promise remains exactly the same. You get the same safety, same quality, same comfort and the benchmark performance that is the hallmark of a Mercedes-Benz. The only difference is that we are able to serve a more broader customer base.
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
and Arindam Chaudhuri (Renowned Management Guru and Economist).
For More IIPM Info, Visit below mentioned IIPM articles.
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri's Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM's Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri - A Man For The Society....
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face
Prof. Arindam Chaudhuri's Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM's Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri - A Man For The Society....
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
