As competition heats up luxury automobile market, BMW and Mercedes-Benz try to catch up to Audi

Gasgoo.com (Shanghai September 11) - Competition in the luxury automobile segment in China has been heating up this year. The recently concluded Chengdu International Motor Show has been proof of this. The Mercedes-Benz C-Class, BMW 316Li and Infiniti Q50L all made their debuts at the show.

One of the biggest new trends in the segment has been the shrinking gap between market leader Audi and its two closest rivals, BMW and Mercedes-Benz. The BMW X1 and New 3Series have helped the manufacturer catch up to Audi; the difference in market shares between the two manufacturers has decreased from 8.8 percent to 7.5 percent. Mercedes-Benz, for its part, has maintained sales growth for 16 consecutive months thanks to successful integration of its domestically manufactured and import sales channels.

Audi has actually lost two percent of its market share due to this increased competition. According to sales statistics, a total of 316,900 Audis were sold in China from January to June, representing year-on-year growth of 17.4 percent. By comparison, BMW and Mercedes-Benz sold 261,900 vehicles and 117,400 vehicles over the same period of time, representing respective year-on-year growth rates of 21.8 percent and 33.5 percent.

Whether or not BMW and Mercedes-Benz will be able to sap away any further market share from Audi remains one of the most important issues in the Chinese automotive market. Representatives from Brilliance BMW echoed this sentiment: "We are very concerned with market share, especially with the scope of sales as large as it is. Market share also signifies future growth potential."

While slashing automobile prices is one way to compete, after sales customer service may end up be the most important area of competition for manufacturers. After Mercedes-Benz decreased the price of its after sales warrantee pack by 20 percent, with Volvo, BMW and Audi quickly followed suit.