For many years now, Mercedes-Benz Malaysia (MBM) has been having a session every three or four months with the press to present the results of its business for the previous quarter. Not all companies do this and obviously, if you’re not No.1 as Mercedes-Benz is in the premium segment, then there’s not a lot to shout about.
This being the second session of 2018 and the first to cover sales this year, there were the usual positive numbers – 3,335 vehicles delivered which was 13.2% better than the same period in 2017; 2.8% market share; 37.3% increase in sales of the compact models; and 18% increase in vehicles serviced at authorised dealers. Great figures which reflect a successful and progressive company that must be well in tune with changing market conditions and customer preferences.
But apart from the chest-beating (though the MBM people are never arrogant), we are also told about some of the developments that will occur in coming months.
Today’s briefing was particularly special as MBM announced that it is introducing a new brand in Malaysia – EQ with EQ Power products. This will be the fourth brand it markets, the others being the Mercedes-Benz product brand, AMG and Maybach.
EQ is the German carmaker’s new brand and while you may figure out that the ‘E’ in EQ must stand for ‘Electric’, ‘EQ’ stands for ‘Electric Intelligence’. It is also explained that the brand name is derived from the carmaker’s brand values of ‘emotion’ and ‘intelligence’ Usually, when a new brand is created, it is for new products and while the brand does refer to a new line of electric vehicles to come, it also represents an umbrella brand for electric mobility.
“We believe the EQ brand will take us forward into the future of mobility with emphasis and innovation in connectivity, autonomous drive capabilities and shared services,” said Dr. Claus Weidner, President & CEO of MBM. “With this, we reaffirm that Mercedes-Benz is, and always will be, the pioneering brand in the automotive industry as we have been since we invented the automobile over 130 years ago.”
The EQ brand made its debut at the 2016 Paris Motorshow and has been launched in Europe and is now progressively being introduced in other global markets. Malaysia is among the first in ASEAN, perhaps since this market has been making good progress in preparing the environment for electrified vehicles – hybrids and plug-in hybrids, in particular.
Though the infrastructure for vehicles that need regular recharging is still limited, it is clearly growing as more and more places have recharging stations. So it’s the right place for Mercedes-Benz to start the EQ brand which is almost entirely about mobility with electrified vehicles.
Contrary to what government officials may think, carmakers cannot respond to new policies or incentives within months or even a year after being announced. There is a lot of planning to do and if it concerns manufacturing and models, then it can take as long as 5 years because models may have to be developed or modified.
While it obviously does not take big risks, MBM has made a number of bold moves since starting business in 2003. For example, the company began work at its plant to assemble hybrid models years before it knew whether there would be any incentives. This was advantageous as some other companies will say ‘tell us what the policy and incentives are and then we’ll consider…’, which means another few years. So MBM made the right move and benefitted when the National Automotive Policy provided for incentives for Energy Efficient Vehicles (EEVs) so they could be sold at a lower price.
In recent years, it has stepped up the pace by offering plug-in hybrid (PHEVs) models such as the C350e and E350e. These are precursors to the all-electric vehicles which will go on sale in 2019, possibly starting with a crossover model. By 2022, there should be 10 EQ models (3 from the smart brand) and the brand should account for 15% to 25% of the company’s global sales.
The fully electric models may not be in Malaysia at that time but will definitely come later on, confirmed Dr. Weidner. In the meantime, the company will increase the marketing of its PHEVs (even adding more choices) and for this, they will be using the EQ Power designation. This designation will from now on be used with PHEV models while EQ will only be for models that are fully electric.
In the past, some car companies just provided the vehicles and aftersales services and that worked when there was no dependence on an infrastructure other than the petrol/diesel station network which is already fully established all over the world. With electrified vehicles, it’s a different matter: these vehicles need to be recharged just as cars with petrol or diesel engines need to be refuelled. It’s a chicken-or-egg situation where private investors (the caretaker government can’t afford it) want to see that they can get returns from building a recharging infrastructure but unless there are many electrified vehicles, that may not happen.
So the car companies have to also get involved in the infrastructure side, at least to get it going in the initial period when the number of vehicles is still small. MBM has done this, starting with the setting up recharging stations at a number of shopping centres in Kuala Lumpur (13 bays in total as of today). The PHEVs can also be recharged at home if a wallbox is installed and while the battery pack provides quite a long range, owners may still want to keep it topped up and having stations in public areas will be appreciated. No doubt, in time to come, dealers in the Mercedes-Benz network will also install a few recharging stations at their premises, thus helping to expand the facilities nationwide.
Besides the matter of recharging, MBM has also formulated an EQ Agility Care package for the C350e and E350e. Customers who agree to keep the car for 3 to 5 years will get free scheduled maintenance as well as an EQ Power wallbox for installation at their home or office.
Another benefit is complimentary use of ChargeEV stations for the first year. Right now, recharging is free in virtually all instances but in time, owners will have to pay for the electricity they take, just like the fuel they buy now. ChargeEV has 100 public recharging stations so owners of PHEVs also have the facility in more places. Fortunately, the industry has agreed on a common plug and socket so that models from any brand can use the stations.