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Supply issues, longer waiting periods expected to continue in Q4: Mercedes-Benz’s Martin Schwenk

Supply issues, longer waiting periods expected to continue in Q4: Mercedes-Benz’s Martin Schwenk

Martin Schwenk, Managing Director, and CEO, Mercedes-Benz India said that the supply chain challenges continue and affect parts availability. The company, however, achieved its best annual sales in calendar year 2018 when it had sold 15,538 units after which challenges like the economic slowdown, the COVID-19 pandemic, semiconductor shortage, etc. hampered its growth rate.

Mercedes-Benz locally assembles most of its cars at its Chakan, Pune plant and due to the unavailability of a single part, production lines get disrupted for the next few months. (Photo: Reuters) Mercedes-Benz locally assembles most of its cars at its Chakan, Pune plant and due to the unavailability of a single part, production lines get disrupted for the next few months. (Photo: Reuters)

Despite selling 3,551 units in its highest-ever second quarter sales, India’s largest luxury carmaker Mercedes-Benz says that the supply-side issues haven’t subsided yet and the challenges are expected to run into the fourth quarter (Q4) of this year. While the company has scaled up production to meet the demand, challenges like supply constraints, semiconductor shortage, inflation etc. are likely to continue.

“We are facing an unprecedented demand for our cars and despite our production colleagues producing highest number of cars for the market, our waiting period is continuously going up. We are therefore requesting customers to now plan their purchases well in advance so that they get their car for these special occasions in their family. We foresee this situation to continue in Q4 of 2022 as well,” Martin Schwenk, Managing Director, and CEO, Mercedes-Benz India said.

Schwenk adds that the supply chain challenges continue and affect parts availability. “We deeply appreciate our customers’ patience who have been waiting for their Mercedes for months and we are doing all that we can, to deliver these cars to customers,” he adds.

Mercedes-Benz S-Class, GLA, GLC, GLE contributed to 7,573 units in the first six months of the year. The company, however, achieved its best annual sales in calendar year 2018 when it had sold 15,538 units after which challenges like the economic slowdown, the COVID-19 pandemic, semiconductor shortage, etc. hampered its growth rate. Today, the waiting period for some of its models ranges from two months to close to two years for specialty cars.

Mercedes-Benz locally assembles most of its cars at its Chakan, Pune plant and due to the unavailability of a single part, production lines get disrupted for the next few months. “Our manufacturing facility plays a vital role in Mercedes-Benz’s CKD (completely knocked down) network and backbone of our India success story. Mercedes-Benz has been making in India since 1995 and with 13 CKD products, we have one of the largest portfolios of locally produced vehicles for a luxury car brand in India,” Schwenk says.

He adds that 90% of the company’s sales volumes in India comprise products that are made in India  

“Our localisation efforts have evolved over the last two decades. From Internal Combustion engine, we are now transitioning to manufacturing of electric vehicles and have adopted digitization widely across our shop floors,” he said.

In addition to local value adding to world-class products, Mercedes-Benz has also developed India-specific products like the Long Wheel Base E-Class. “India is also the first market after Germany to make the Mercedes-Maybach limousine,” he adds.  
 

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