Daimler CEO says must fix China operations to catch BMW

Bloomberg News (Frankfurt) - Daimler AG (DAI) Chief Executive Officer Dieter Zetsche said the Mercedes-Benz brand must turn around its struggling Chinese operations to catch up with Bayerische Motoren Werke AG (BMW) and Volkswagen AG (VOW)'s Audi.

"We have to fix China," Zetsche told reporters today at the North American International Motor Show in Detroit. "And that's what we're doing."

Daimler is negotiating its role in a possible initial public offering by Chinese partner Beijing Automotive Group Co., the CEO said, without giving details. There are no talks with China's sovereign-wealth fund to buy a stake in the automaker, he said, denying a media report from last week.

Zetsche has vowed to retake the top spot Mercedes lost to BMW in 2005 by the end of the decade at the latest. Audi, No. 2 in global luxury sales since 2011, is pursuing the same goal. Mercedes fell further behind BMW and Audi in sales last year as it grew more slowly in China, the world's biggest car market, than its two main rivals.

Daimler, based in Stuttgart, Germany, has named Hubertus Troska to its board with responsibility for China and is combining its separate sales organizations in the country for imported and locally produced cars into one entity.

"We have to give the new people a chance," said Zetsche. "This is a good starting point."

New products will give Daimler momentum this year, the CEO said. Daimler presented a refreshed E-Class sedan in Detroit and will introduce an overhauled version of the flagship S-Class sedan later this year.