RON430

Autoweek September 22, 2003

"Questioning Quality

Customers aren't the only ones taking a hard look at the quality of Mercedes-Benz. Mercedes officials are too.

According to a story in AutoWeek's sister publication, the trade paper Automotive News, top executives at the German automaker say glitches in increasingly complex electronic components are forcing the company to take a more measured approach to future introductions of leading-edge gadgetry in its new cars.

Oficials said the company was even forced to buy back 2000 copies of the latest E Class sedan sold in the United States, due to problems with Comand, Mercedes' integrated navigation, entertainment and telecommunications system. Product testing related to Comand is up 50 percent in an effort to solve the complex systems failures, Automotive News reported.

Mercedes' initial quality rankings by J.D. Power plummeted from fifth in 1997 to 15th - two notches below Chevrolet - in 2003. Daimler-Chrysler board member Jurgen Hubbert said the erosion relates directly to the company's efforts to be a technology leader. Problems center on malfunctioning navigation/control screens and related systems.

Mercedes officials insist the company will continue its tradition of technology leadership - just as soon as it gets its electronics gremlins under control."

Hmmmmm, let's see, buying back 2000 new E classes at an ASP of say $55K, a 110 million dollar "quality" problem, wonder where that will show up on the bottom line or if they will just become "Starmark" cars. Before the inevitable post of "Gosh what a good company Merc is to throw $110 million at unhappy owners" be advised that in my view letting such cars out in the first place is a debacle that ranks right down there with the worst of GM and there was no "goodness" involved here in the US, just not wanting the courts involved. Evidently I had it wrong with the E55 ad, that isn't the monstrous engine getting out, that is a Mercedes spec gremlin infecting the house.

It is really obvious that the Mercedes buyer is definitely not a Lexus buyer and that the Lexus brand has had little, if any impact, on Mercedes quality or reliability. Sure glad enough people place technology high enough to put up with these abominations on a day to day basis. Yet another Mercedes program to emphasize quality. Can peace in the mid East be far behind?

Oh, and what was the "little" bimmer news from Autoweek? In the Sports Car Buyers Guide (Part 1) for this week, the base price of the next M5 which has been widely reported in the mags to be an estimated $78K is now reported as an estimated $85K base price. Shucks, hardly a ten percent raise. Doubtless it is going to be a wonderful car and it isn't going to give you any change back from your $100K bill here in Cali either.

Iceman

Actually, I think Lexus has had an effect. Otherwise Mercedes wouldn't have bothered buying back the defective E's at all! The way I see it, Lexus has driven a wedge between BMW and Benz. BMW is becoming even more performance-oriented in their designs and marketing, while MB is focusing more on luxury features and gadgets. Both have sacrificed reliability, and BMW has also given up aesthetics. Meanwhile Lexus sales continue to rise since the brand provides great performance, great luxury, great looks, at a great price. No Lexus can outperform an M5 or boast more features than an S600, but they don't have to. Lexus achieves one of the overriding goals of my life--BALANCE.

D2-AUTOSPORT

Its really shame that such nice looking and performing (55's) cars are saddled with electronic gremlins. When are the Germans just going to outsource electronics to the PROs? (Japanese that is) I think the reliability issue really tarnishes a premium marques image, I believe there is someone on this board that returned a S55 in order to get a LS430 due to issues with the M/B.

Not to bash on M/B, just sad they have those issues.

RON430

The comment about Lexus having little effect on bimmer and Merc was just what I was struck with when I first read the piece in Autoweek. I think that Lexus has had an effect on both bimmer and Merc but I don't think they have had much effect on bimmer and Merc customers, if that makes sense. And actually, I think this thread could progress without a Lexus view at all.

As you look for why your sales aren't what you think they should be, you reach a bunch of funny conclusions. Obviously, E sales aren't what Merc thinks they should be and they have focused on the "quality" issue. And, as I originally posted, I don't think there is any "Do the right thing" at Merc about the E's problems. If they had 2,000 really unhappy Merc owners (and exactly how many do you think are lawyers?) and don't want the E and Merc dragged through a class action suit, you determine how much it costs to buy the owners off versus going to court. Obviously the decision is that it was cheaper to spend at least a 100 million dollars (that still staggers me) to buy back the worst of the worst (wonder just how many didn't qualify for the rebuy and are still sitting in people's garages?) and admit you couldn't fix them in the field no matter how long the service department has the car. On this we may slightly disagree but I fully respect your opinion.

I would also disagree slightly with the assessment about bimmer and merc going higher performance. There is no doubt that merc is in a hp war with itself (it seems) and possibly bimmer. But after spending a little time in a new five in Germany a couple of weeks ago the overwhelming impression I got was that the bimmer was getting more Lexus like. The steering was no where near as precise as I remember from my experience with bimmer and the screwy electronic suspension seemed to be most adept at going soft for ride rather than responding for handling. In fact, in a quick left/right it was pretty obvious that the bimmer had a noticeable, and unpleasant lag. This is a bit similar to what I sense in the new seven. It seems like the driver makes input but the car thinks about it for a split second and then determines what to do. I will take plain old stabilizer bars and steel links, thank you.

Without polishing the Lexus apple too much, I am all for technology being introduced that improves a car. But this baffling germanic desire to introduce new technologies for the sake of the technology, whether they improve the car or not, and then flog them off to their loyal, and unsuspecting, customers, is disgusting. Whatever Lexus does I hope that they resist to put a vehicle out there that is not fully sorted out. I really don't need a joystick and LCD to change stations on the radio. My Lexus round **** is not only fine but a very refreshing departure in today's luxo interior. And if Merc spurs quality challenged E sales with a TV spot for the E55, well I guess it will be a long time before I would want to be part of the Merc owner club. Of course I would expect merc to be at least as reliable as a chevy and it seems they can't even do that right now.