An employee fits wheels onto a Mercedes-Benz A-Class automobile, produced by Daimler AG, on the assembly line of the Mercedes-Benz AG factory in Rastatt, Germany. (Photographer: Michaela Handrek-Rehle/Bloomberg)  

Mercedes Sees New A-Class Sedan Boosting Sales Amid SUV Craze

(Bloomberg) -- In a luxury auto market where sport utility vehicles are now a solid majority of sales, Mercedes-Benz is betting a new entry-level sedan is the ticket to growth.

The Daimler AG-owned brand, which has led the U.S. premium auto market the last three years, expects the new A-Class sedan to lure younger customers that eventually will move up into more expensive vehicles. The car, which starts at $32,500 and arrives in showrooms this quarter, should help revive Mercedes deliveries after a 6.3 percent drop in 2018, Dietmar Exler, chief executive officer of U.S. operations, said in a phone interview.

Mercedes Sees New A-Class Sedan Boosting Sales Amid SUV Craze

“I think we should be back at the levels of 2015, 2016, 2017 again with all the products coming now,” said Exler, forecasting Mercedes will sell about 330,000 vehicles this year. “I think we’re going back to where we were, because 2018 was an anomaly for us because of product availability.”

Mercedes Sees New A-Class Sedan Boosting Sales Amid SUV Craze

Exler expects the U.S. luxury market to be roughly flat this year at around 2 million units, with any growth dependent on whether Tesla Inc. is able to maintain production levels of its Model 3 sedan.

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