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Market Insight: Premium compacts light up

Number one: The Mercedes-AMG CLA45 has become the top-selling AMG model in Australia this year, overtaking the fiery A45 hatch.

Mercedes’ multiple offerings proving popular but Audi’s A3 is top dog

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Market Insight logo25 Sep 2015

By STUART MARTIN and TIM NICHOLSON

UPDATED: 06/10/2015MERCEDES-BENZ says 75 per cent of buyers of its compact range are new to the brand, and despite some models falling behind key rivals in overall sales, the company is satisfied with take-up of its burgeoning small-car range.

The German car-maker has seen a sharp increase in its overall sales since it launched the new A-Class in early 2013, followed by other models built on the MFA compact platform including the CLA sedan and Shooting Brake (wagon) and the GLA crossover, not to mention the B-Class tall-boy hatch.

The combined total of Mercedes’ compact range so far this year is 9368 units, which is about 40 per cent of its overall SUV and passenger-car sales of 23,642 to the end of September.

Year to date, A-Class sales have dropped by 20.5 per cent in the increasingly busy premium small-car segment, and now sit on 2851 for the year, while the B-Class has lost 18.7 per cent over the same period, with 1522 units, although it had a bumper September, up 30.5 per cent over the same month in 2014.

The swoopy CLA has been snapped up by 2787 buyers so far this year, which represents a massive 75.1 per cent leap over the same period in 2014.

This figure has been helped by the arrival of the Shooting Brake version in June this year, which has sold better than the car-maker had expected, while the CLA45 AMG is now the biggest-selling AMG model of 2015, overtaking the A45 AMG.

So far this year Audi has sold 3956 A3s to sit well ahead of the A-Class tally and take the lead in the segment. The latest-generation A3 has gone from strength to strength since the first variants launched Down Under in May 2013.

Since then a number of additional variants have arrived, ranging from more performance-honed versions such as the S3, to a sedan body style and a convertible. Under official VFACTS classification, the A3 sedan and Sportback hatch are counted together, whereas the A-Class and mechanically related CLA are in two separate categories.

In 2013, Audi clocked up 2138 A3 sales and increased this to 4549 last year, while the A-Class found 3218 homes in 2013 and 4676 last year to lead the segment.

Even though Audi’s A3 has pulled ahead of the A-Class in outright sales terms in the premium small-car category, Mercedes-Benz Australia/Pacific senior manager of public relations, product and corporate communications David McCarthy said he was confident the smaller end of the range would continue to pull its weight.

“Audi A3 counts the hatch and sedan,” Mr McCarthy said. “A-Class is hatch, (so) if you add in CLA as well it’s a bit different.”

With A- and B-Class sales down so far this year, it has been the CLA and the jacked-up GLA crossover that are performing strongly.

The GLA has added 2851 sales to Mercedes’ 2015 tally, with evidence of it pinching A- and B-Class sales in the process.

“There’s a little bit of anecdotal evidence to say some go in to buy an A and end up in a B or a GLA. It’s a wonderful line – the choice of luxury and the luxury of choice,” Mr McCarthy said.

Meanwhile, BMW’s 1 Series has struggled to maintain the pace of its German rivals, with 1720 sales YTD representing a 6.8 per cent dip, after recording 2382 in 2014 and 2311 in 2013.

The arrival of the B-Class-fighting 2 Series Active Tourer has helped maintain BMW’s share of the premium small-car segment, with 1451 sales so far this year, just 71 units behind the Mercedes equivalent.

The other contender is Volvo’s V40, which has recorded 821 sales to the end of September this year, a 5.4 per cent lift, while the slightly jacked-up V40 Cross Country has found 307 homes in the same period.

In its first year on sale in 2013, the V40 captured 1064 sales – the CC grabbed 109 – and in 2014 the pair ended the year on 936 and 372 respectively.

Whether Audi’s popular A3 can maintain its momentum and take the title of best-selling premium hatch in 2015 remains to be seen, but Mercedes-Benz will not be resting on its laurels, with a refreshed A-Class arriving before the end of 2015.

The brand’s traditional buyers will have more reason to shop when the latest incarnation of its E-Class arrives in the local market towards the end of next year, but Mr McCarthy said the current-generation version still attracts strong sales for the segment.

“We do well with E-Class. There are still buyers for that car (and) the Estate still gets a reasonable number of buyers,” he said.

“I think the new one will bring a lot of people back to the brand with the technology and the look, with the new interior, is very nice and it will be priced competitively.”

Plug-in hybrids are also inbound, with the first – the S500 plug-in hybrid – here before the end of the year, followed by plug-in hybrid models of the C-Class, E-Class and GLE SUV to follow.

The brand will make the long-awaited debut of the smaller GLC SUV, a model expected to be priced in the region of $70,000 and one for which Mercedes-Benz dealers have long anticipated, after the GLK failed to make it to Australia due to left-hand drive only production.

“The GLC SUV is here in December, later next year the GLC Coupe. Again we haven’t operated in that segment and there is pent-up demand there,” Mr McCarthy said. “We can’t wait to get it.”

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